Crossrail and Demonstrations – Disastrous Impact on Mayor’s Budget

The BBC have reported that Crossrail (otherwise known as the “Elizabeth Line”) could be delayed until 2021. A senior source associated with the project has apparently told the BBC that testing of the trains and signalling was proving difficult and none of the new stations on the line are yet complete.

This will cause major problem for Sadiq Khan because the income from passengers on the line was going to help fill the yawning operating deficit of Transport for London (TfL) in 2019-2020. This was already forecast to be a negative £1.44 billion in that year. Or “net revenue expenditure” as TfL prefer to euphemistically call it, when it is a simple case of massive losses where revenue does not even cover operating costs let alone capital expenditure.

TfL expected to get £170 million from passenger fares on Crossrail in the current financial year and £350 million next year (2020-2021). That’s going to have a major negative impact on the deficit in TfL.

The delays to Crossrail are also likely to mean even more capital expenditure than on Crossrail than was forecast in the current financial year – that’s another few billion pounds probably.

Demonstrations Not Helping

Much of TfL’s income comes from Bus and Tube fares at present. The current demonstrations by Extinction Rebellion are severely disrupting bus operations and no doubt reducing fare income. As many as 50 bus routes run through Oxford Circus, Oxford Street and Regent Street alone. Is that why the Mayor initially supported the demonstrations but has now changed his tune? The threat to disrupt the Underground services must have been the last straw.

The additional overtime for police officers to control these demonstrations may also be running into millions of pounds which the Mayor will have to pay for.

The Mayor suggests in his latest tweet that his concern is about the safety of the public, but as usual with Sadiq Khan the truth may be otherwise – it’s about money! There is also the problem that the Mayor is up for re-election in May 2020 and by then his financial budget will be looking quite appallingly bad. With no more give-aways possible to bribe the electorate with this time around, he has a real problem!

Roger Lawson

Twitter: https://twitter.com/Drivers_London

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Mayor Lies at the People’s Question Time in Bexley

OLYMPUS DIGITAL CAMERA On the 14th March there was a “People’s Question Time” in Bexley where Mayor Sadiq Khan answered questions from the public (photo left).

It commenced by the Mayor suggesting that London’s roads were unsafe because he had no control over road safety in response to a question on junction improvement. He claimed that 95% of the roads are controlled by local boroughs, suggesting it was their fault. But in reality, the Mayor via TfL controls almost all the money spent on roads and road safety. TfL dictates what projects local boroughs can spend on by only funding what they like. In addition they dictate transport strategy directly. As a result, boroughs are forced to spend hundreds of millions of pounds on 20 mph wide area speed limits that have been proven to be totally ineffective, on cycle lanes, speed hump schemes and other pointless measures.

The Mayor was also criticised for spending £400 million on the proposed Rotherhithe cycle/pedestrian bridge, and when it came to policing there was applause from the audience when one person suggested he could solve the crime problem overnight by just diverting money spent on cycle lanes to the police.

When discussing public transport the Mayor said that London is the only city in the world that is not subsidised by Government. That is simply not true. TfL receives £3.2 billion in grants which is 31% of TfL’s income. Most of that money comes from taxes and much comes from central Government – see https://tfl.gov.uk/corporate/about-tfl/how-we-work/how-we-are-funded .

In response to questions on the environment the Mayor said that London air is a killer which is a gross exaggeration. But he got one point right – namely that diesel buses are a major problem. He said the worst areas for air pollution in London are those with the most buses. He said they are not buying any more diesel buses and are retrofitting existing ones.

He got criticism on the ULEZ but apparently expects central Government to bail out folks who cannot afford to buy a new car, which is highly unlikely to happen.

His final major point was to promote another referendum on Brexit. What a pity that Parliament ruled it out the same day which probably pleased the audience and certainly pleased me.

You can see a recording of the meeting here: https://www.youtube.com/watch?v=Lmqgw6OjMD4

Mayor’s Tax Precept Rises

There were a number of criticisms of the Mayor’s financial policies at the meeting described above. London residents may have just realised that their local Council Tax is rising significantly this year and one reason is that the Mayor’s tax precept that you pay in your Council Tax, and is passed through to the GLA, is rising by 8.93%. That’s way ahead of inflation and is another example of the Mayor’s financial incompetence.

Roger Lawson

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Mayor’s Dubious Gesture and Taxi Age Consultation

Sadiq Khan, Mayor of London, has announced more money for his “scrap for cash” fund. Previously this trade-in scheme for older more polluting vehicles had funds allocated of £25 million but it’s now £48 million. This is particularly designed to help small business owners to replace vans and to help “low-income Londoners scrap older cars”, i.e. the vast majority of vehicle owners will not be eligible.

However, details of the additional scrappage scheme won’t be available until later in the year, despite the fact that the central zone ULEZ commences in April. Details of even the first scheme for vans do not seem to be available from TfL. In reality the amount of money being offered will not cover the vast majority of costs incurred by people in replacing cars and vans, so this looks like a token gesture.

The Mayor did of course promote this scheme at a recent Clean Air Summit meeting where he had children support his actions in the audience. Likewise at a recent London Assembly Committee meeting. They had clearly been well-rehearsed by their teachers. Some of these children came from Henry Maynard Primary in Walthamstow. If you think it is wrong for uneducated children to be used to promote dubious policies which are primarily aimed at raising taxes rather than solving real air pollution issues, you could contact the school here: http://www.henrymaynardprimary.co.uk/contact-details/

The Mayor is a serial offender in using children to support his political campaigning as the ABD has covered previously. Does he have no ethics?

The Mayor has also launched a public consultation on changes to the age limits of taxis – see https://consultations.tfl.gov.uk/tph/taxi-age-limits/?cid=taxi-age-limit . Older diesel taxis are undoubtedly some of the most polluting vehicles in central London, but will his changes actually have an impact on pollution? There is a very long phase in time which means that the taxi vehicle fleet might change substantially anyway. There is also still only one electric charging point for taxis in central London so any taxi owner would be unlikely to move to an electric vehicle until that issue is resolved.

Note that these proposals replace previous ones that have not worked. As the Consultation says: “in spite of previous steps to reduce taxi emissions, the required reduction in emissions has not been achieved”. But there is no clear estimate provided of the impact of the new proposed measures on air pollution. And as usual with TfL consultations of late, no cost/benefit justification provided as there should be.

Roger Lawson

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Profits from the ULEZ – Taxes, Taxes and More Taxes

I have covered previously the likely extra income from the Ultra Low Emission Zone (ULEZ) scheme in London – see articles on this web page: https://tinyurl.com/y9sgwedh – particularly the one named “Cost of the ULEZ”.

Transport for London (TfL) tried to hide the likely income from the scheme and what figures they did eventually disclose grossly under-estimated the likely profits they would make. But the Guardian and the Times newspapers have recently published more information that is very revealing of the true facts.

The Guardian quote TfL as saying that “it projects that in 2019-20, the first year of the ULEZ, revenue will be £174m and costs £47m, producing a surplus of £127m. TfL are suggesting revenue will rise to £222m giving a profit of only £97m in 2021-22, after increased costs, when the ULEZ zone is greatly expanded to within the North/South Circular. That would seem to assume that a very large proportion of affected vehicle owners (e.g. those with older diesel or very old petrol ones) will have bought newer vehicles by then. It is a surprisingly low estimate given the very much larger number of vehicle owners who use them daily in the London suburbs as opposed to those who drive in central London. It again seems incredible.

As pointed out in the aforementioned article, apart from the approximately £200 million that will be taken out of the London economy and out of the pockets of London residents by the ULEZ charges every year for the next few years, there is also the cost incurred by those people who buy newer replacement vehicles. That is estimated at £203 million.

The Times spelled out exactly how many vehicles are likely to be affected by the ULEZ this year. They reported that TfL said there were 1.5 million diesel cars registered before 2016 which entered the central zone last year, some 500,000 petrol cars registered before 2006, some 400,000 vans, 55,000 HGVs and 10,000 coaches.

You can see that these are really enormous numbers and explain why the Mayor is so keen on using the ULEZ to improve London’s air. His latest claim is for a reduction of 45% in NOX in central London and 40% in the surrounding area with further reductions when the ULEZ is expanded in 2021. But there is no clear evidence that NOX has a significant impact on health (even COMEAP seem uncertain).

I suggest the ULEZ scheme is a giant con to raise more taxes to fix the Mayor’s budget problems. There is no major public health crisis in London as he alleges. Just to remind you, the health benefit was valued in the original consultation document on the ULEZ as being £7.1 million over 5 years. Even if one accepts that estimate which is very dubious, how does that justify a total cost imposed on vehicle owners of as much as £1.2 billion over 5 years? It cannot be.

Roger Lawson

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TfL’s Business Plan and Budgets – Financial Profligacy

The Mayor of London has published a Business Plan for TfL for the next five years plus a Budget for 2018/19– see https://tfl.gov.uk/corporate/publications-and-reports/business-plan. The Business Plan is much as outlined in his adopted Transport Strategy so he aims to get the proportion of journeys taken by walking, cycling or public transport up to 65% by 2024 when it’s about 63% today. That’s despite the recent lack of progress in achieving that goal as highlighted in our previous article on London travel trends here: https://tinyurl.com/ybtchctj

For east Londoners he is committing to progress that vanity project called the Rotherhithe bridge, but there should be new Woolwich ferry boats delivered in 2019, progress on the Silvertown Tunnel and the document mentions a budget for “renewal” of the Rotherhithe Tunnel.

But the bad news for all Londoners is that the Mayor intends that TfL will continue to run a big financial deficit until 2021. That date does of course coincide with the expansion of the ULEZ zone to the North/South Circular which will be providing more income and also the Elizabeth Line (Crossrail) should also be in operation by then which will also assist. There is a small surplus budgeted for in 2022/23.

Another item of bad news for all Londoners is that “proactive” street maintenance budgets will remain at zero so we will see more short-term and reactive patching. This is surely a short-sighted financial approach. Has the Mayor not heard of the phrase “a stitch in time saves nine”.

The delays to Crossrail and falling bus usage have been two causes of the short-term deficits but the Mayor continues to hobble himself with the promise he made to freeze public transport fares so as to get elected. The Mayor claims to have reduced “like-for-like” operating costs in the last two years but that is a claim that is difficult to verify and overall income/costs are what matter.

One consequence of this financial ineptitude is that TfL are having to borrow more money. Debt has been, and will continue to rise rapidly based on the budgets. It will be 175% of revenue in 2018/19 (revenue not profits note), and financing costs will be 7.5% of revenue in that year. That does not look like a sound financial strategy to anyone familiar with the financial world. The Mayor is just in the process of building up a big problem for his successor.

What is remarkable about the two aforementioned documents is the lack of detail on where the Mayor is actually spending money, e.g. the proposed capital expenditure. We just get headline titles such as £116 million to be spent on “Healthy Streets”, £80 million on “Air Quality”, £114 million on “Public Transport”, etc. There is also little detail on operational income and expenditure. The budget for 2018/19 has to be approved by the London Assembly and there is a bit more detail in this version submitted to them: https://tinyurl.com/y78cjoyq

So for example it shows (on page 37) that the introduction of the ULEZ (for central London only in 2019) will cost around £40 million. But the revenue from it seems to be just dumped into “other income” so it is impossible to evaluate the cost versus benefit of it.

Here are some simple questions one could ask that are not answered by these documents such as:

  • How much money is being spent on Cycle Superhighways, Quietways and other cycle projects?
  • How much does the Santander Cycle Hire scheme cost to run, or does it make a profit? What is being invested in expansion of that scheme?
  • How much is TfL spending on funding wide-area 20 mph schemes in local boroughs?
  • What will be the real costs and income from the ULEZ, both before and after expansion?

There is simply insufficient detail provided to answer these questions. These documents do not provide enough financial detail to judge the merits of the Mayor’s plans at all. One suspects a lot of dubious projects and expenditure are being concealed in these public relations documents.

But there is one thing for certain. There is no budget to improve the road network in London so as to increase capacity and reduce traffic congestion. With London’s population expanding, that is a serious omission.

Roger Lawson

Twitter: https://twitter.com/Drivers_London

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City Corporation Response to Draft Transport Strategy

I have covered the City of London’s draft Transport Strategy before – see https://tinyurl.com/yd3qne6c . I called it a stinker because it is an aggressive attack on most forms of road transport with a 15-mph speed limit proposed across the Square Mile, a zero-emission standard for all vehicles and road closures.

The ABD has now submitted a formal response to the public consultation which covers our objections in detail – see https://tinyurl.com/y8o23l9u

It’s a good example of how the Mayor of London’s Transport Strategy is being followed in the local boroughs and how it is corrupting London’s road transport network. The policies promoted are simply irrational, will not work and fail to cope with the increasing population and business activity in the City.

You can still respond to the public consultation which closes on the 13th January. Go here to do so: https://www.citystreets.london/ or send an email to strategic.transportation@cityoflondon.gov.uk

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More Tax Raising by Sadiq Khan – Changes to the Congestion Charge

The Mayor of London, Sadiq Khan, has decided to proceed with his proposed changes to the London Congestion Charge (a.k.a. Tax). Private hire vehicles (PHVs – minicabs including Uber vehicles) will no longer be exempt from the Charge from April 2019.

This change is justified on the basis that congestion will be reduced after the number of vehicles, particularly PHVs has increased substantially in recent years. Now only 50% of vehicles entering the central zone pay the Charge. But how much will the number of vehicles be reduced – about 1% according to TfL.

The fact that taxis (registered black cabs) will continue to be exempt but PHVs will not be is a most peculiar anomaly. A legal challenge may well be mounted over that issue. But taxi drivers are also unhappy with the latest announcement because the Mayor is going to limit the age of such vehicles to 12 years when the current maximum is 15 years.

Another change is that the Ultra Low Emission Discount (ULED) from the Congestion Charge for low emission vehicles is being scrapped and replaced by a new Cleaner Vehicle Discount (CVD). The latter discount will only be available to zero emission (i.e. electric vehicles) from 2021 to 2025 after which no discounts at all will apply.

These changes are going to mean substantial extra revenue to the Mayor and TfL and are surely more about tax raising than the claimed objectives. These changes are simply irrational and will have no impact on either air pollution or congestion in central London.

The ABD has pointed out before that the London Congestion Charge is a totally ineffective solution to traffic congestion and has just turned into a revenue raising scam. See https://www.freedomfordrivers.org/congestion.htm

The ABD, along with many other organisations, submitted objections to the changes which have simply been ignored. See this web page for a more details and a link to the consultation responses: https://consultations.tfl.gov.uk/policy/private-hire-charge-exemption/

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