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Government Offer to Help Pay

Published: 09/06/2021 By Allan Fuller

The government has said it is willing to fund a third of the cost of repairing Hammersmith Bridge.

The offer was included in the new funding package for Transport for London (TfL) which requires it to make a further round of cost cutting measures but underwrites the revenue it receives up to the end of the year.

While stating that Hammersmith & Fulham Council remain responsible for paying for the repair, the government now say that “given the extraordinary circumstances of the pandemic, during the period of this agreement, we expect to draw up a memorandum of understanding between HMG, TFL and the London Borough of Hammersmith & Fulham to fund the reopening of Hammersmith Bridge – initially to pedestrians, cyclists and river traffic and, depending on cost, to motorists”.

This funding will be conditional on all three parties agreeing to the cost of the project, each party paying a share of the cost and the government paying no more than a third.

The independent Board responsible for the Case for Continued Safe Operation, reporting to London Borough of Hammersmith and Fulham, is to conduct a new assessment for controlled and limited reopening of Hammersmith Bridge to pedestrians, cyclists and river traffic once further investigations and report validations are completed at the end of June.

There has not been any response from the council or TfL to this offer as yet. It is likely that, if it were to be agreed to, that TfL would have to take on the burden of much of the remaining cost of the repair. The council has estimated that full repairs will cost between £141million and £163million, with £46million needed just to stabilise the bridge.

One local resident who has been campaigning since the closure of the bridge said, “There is little detail here so it is too early to say if this is a decisive step forward, but my first reaction is that the government’s offer is inadequate particularly in the context of TfL being required to make significant cuts elsewhere.”

The £1.08 billion offered to TfL for the overall package is conditional on a number of things including further investigation of driverless trains and a review of TfL’s pension scheme which the government describes as ‘generous’. TfL is required to deliver extra savings or new income sources in the current financial year as well as set aside an extra £100 million to continue the delivery of healthy streets and active travel programmes.

The settlement will provide financial support until 11 December 2021 and takes total Government’s funding to TfL since March 2020 to over £4bn. If TfL’s revenue falls below a certain level the government will provide additional support but if it rises above that level funds will be returned to the government.

Transport Secretary Grant Shapps said, “This £1.08bn financial package will support London and its transport network through the pandemic, and ensure it is a modern, efficient and viable network for the future.

“Throughout this process the Government has maintained that these support packages must be fair to taxpayers across the UK and on the condition that action is taken to put TfL on the path to long-term financial sustainability. As part of today’s settlement, the Mayor has agreed to further measures that will help ensure that.”

London’s Transport Commissioner Andy Byford said, “The pandemic – during which our staff have worked so magnificently to keep London moving – has shown our financial model, with such a disproportionate reliance on fare revenue, to be not fit for purpose.

“We are working hard to rebuild revenue through attracting people back to our services with nearly 60 per cent of pre-pandemic ridership already travelling again. Today’s funding agreement with the Government provides £1.08bn in base funding and further support should our passenger revenue income be lower than forecast until 11 December 2021 to enable us to continue to run near full levels of service to stimulate London’s recovery and deliver a host of improvements like the Elizabeth line, Northern line extension and expansion of London Overground. It is vital that we also use this period to agree a longer-term settlement so that we can plan effectively for London’s future and deliver maximum value for money through our contracts and supply chain.

“The conditions placed on us by the Government agreement and the amount of funding we will receive means we need to find a further £900m of savings or new income this year compared to our approved Budget and on top of the £730m of savings already assumed in our Business Plan. We will work through this while protecting front line services to deliver what London needs and to play our full part in recovery, decarbonisation, improving air quality and promoting active travel.”

RMT General Secretary Mick Lynch said, " “This is a disgraceful stitch up of a deal and it will be resisted by our members whether it comes from Whitehall or City Hall through London wide industrial action if necessary.
 
 "It is completely unacceptable for transport workers who have risked and in some cases tragically lost their lives to now be asked to pay this political price for the coronavirus.
 
 "Attacks on workers’ pensions are wholly unacceptable while driverless trains are unwanted, unaffordable and unsafe.
 
 "With funding only lasting until December London is being held to ransom with a gun to its head rather than being given the long term stable funding deal that is necessary to rebuild the economy as we move out of lockdown.”

Rowena Howie, the Federation of Small Businesses London Policy Chair said, “Whilst we understand the impact the pandemic has had on the public purse, these last-minute funding deals are a concern to business. The short-term deal agreed last year which led to the extension of the Congestion Charge to £15 from Monday to Sunday now looks ominously like become a permanent fixture that will add to the economic costs of doing business for thousands of small firms in the capital. A long-term solution is urgently needed to this issue so that businesses have confidence and are not priced out of the capital city as we move towards recovery.”