Transport for London (TfL) pushes ahead with "rigorous approach" to cost-cutting as it unveils draft budget for 2017/18

 
Rebecca Smith
TfL said it expects 24.7m lost customer hours due to  problems on the London Underground for 2016/17
TfL said it expects 24.7m lost customer hours due to problems on the London Underground for 2016/17 (Source: Getty)

London's transport commissioner Mike Brown said Transport for London (TfL) is continuing a “rigorous approach” to driving costs down in its "biggest ever overhaul", as it unveils a draft budget for 2017/18.

At the end of last year, TfL announced it will make savings of £800m a year as London mayor Sadiq Khan pledged to cut management layers to shape up “a flabby TfL”.

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And in the draft budget, TfL said for 2016/17, it forecasts operating costs to be £195m lower than budget as the organisation takes measures including working to secure better supplier deals, shedding management and relying less on agency staff.

Earlier this year, City A.M. reported that the organisation had contacted over 2,000 agency staff asking them to sign up to several options including stopping working for TfL, as it looks to stop using temporary workers who operate through limited companies.

TfL said operating costs for 2017/18 are budgeted to be £75m lower than set out in the business plan. Its grant from central government will be reduced by £219m, so the transport body said it was imperative it keeps a firm handle on costs. The “rigorous approach” to costs will continue and expand over the year.

But the Rail, Maritime and Transport (RMT) union has voiced concerns the cuts being made by TfL are too severe as the organisation grapples with what will be a £2.8bn cut in grant from central government overall, set to phase in over five years.

General secretary Mick Cash said the union remained “deeply concerned at the impact of government austerity cuts on the TfL budget” and said the cuts “compromise capacity and safety at a time of surging demand”.

Also in the draft budget, the mayor announced that while passenger numbers on the Tube, DLR and TfL’s rail network had risen, bus ridership was forecast to decline by an average of 2.3 per cent from this year and on some routes in the capital, bus speeds had fallen by more than 10 per cent.

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That is despite the mayor’s introduction of the Hopper bus fare, which allows passengers to take a second bus or tram at no extra cost within an hour of starting their journey. Earlier this month, the fare hit its 50 millionth journey, since launching last September.

Khan plans to invest £20m a year in “bus priority measures”, with TfL delivering around 170 schemes to save passengers time on some of the most congested routes.

The mayor said: “Encouraging Londoners to use our world-renowned bus network is a crucial part of our work to tackle congestion, clean up our air and improve our city for everyone.”

Read more: Changes to agency contracts could push out temporary TfL workers

Brown added: "Londoners will see a wide range of improvements to their service over the next financial year, including more staff to assist them on the Tube, newly modernised stations completed at Victoria, Bond Street and Tottenham Court Road, better and safer cycling infrastructure and road junctions, and new Elizabeth line trains coming into service."

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