Transport for London (TfL) is on the brink of running out of cash and not being able to pay staff, the mayor of London has revealed.
Speaking to the BBC, Sadiq Khan said London's transport authority would not be able to pay staff by the end of the month unless the government provides help.
Ministers entered into talks with TfL over a week ago about financial support and suggested a bailout was likely. Mr Khan's move to make his case in the media suggests some negotiation over the financial package is taking place.
With no government grant anymore, TfL relies on fare revenue to support itself. This income has naturally plummeted as a result of the coronavirus lockdown, however, it was in financial difficulties prior to the coronavirus due to the mayor's fares freeze and delays to Crossrail.
Transport for London (TfL) has been using cash reserves to keep running, the mayor said.
He told BBC Radio London that services could be cut 'because we can't pay people' unless the government stepped in.
Tfl earned £4.9bn form fares in 2019-20, making up 47% of the transport authority's income.
Since the lockdown, there has been a 95% cut in people using the Tube, while the number of bus passengers has dropped by 85%.
Since a change of policy on buses to switch to the middle door only boarding for safety reasons, passengers were told they no longer need to tap in and out - making the services free.
The BBC reports that it costs £600m a month to run London's entire London transport network.
A TfL spokesperson said: 'The Mayor was referring to reaching our prudent ‘minimum cash balances’ by the end of the month, which by then will still be £1.2bn.
'This is sufficient for us to keep operating the city’s core transport and paying our staff while we are in constructive discussions with the Government on our financial future.'
Register now for full access
Register just once to get unrestricted, real-time coverage of the issues and challenges facing UK transport and highways engineers.
Full website content includes the latest news, exclusive commentary from leading industry figures and detailed topical analysis of the highways, transportation, environment and place-shaping sectors.
Use the link below to register your details for full, free access.
Already a registered? Login
