London mayor Sadiq Khan has said he will not accept the Government's demands as ministers put pressure on Transport for London (TfL) to accept terms on any future COVID bailouts.
In a bitter dispute between central government and local powers, Mr Khan said he would not accept a 'tripple whammy' of rising costs for Londoners, including increases to council tax bills, to pay for financial support from government.
He said: 'I am sorely disappointed that instead of supporting our transport network, the Government is proposing to hike the cost of travel for all Londoners by:
- extending the £15 congestion charge to the North and South Circular
- increasing fares in London by more than inflation
- seeking to make council tax more expensive for Londoners to pay for public transport.'
Mr Khan added: 'This will hurt businesses and families at a time when so many are already facing real hardship. I will not accept this triple whammy of high costs.'
It was even reported by the Financial Times that ministers had even threatened to take direct control of TfL unless the mayor accepts the package of measures.
Transport secretary Grant Shapps apparently wrote to Mr Khan stating: 'We will be taking reserve legislative powers allowing us if necessary to direct TfL. This would be combined with a further series of short-term funding settlements.'
He also said he expected the mayor to begin 'pensions and workplace reform, accelerate the "inadequate" progress on implementing driverless trains, cut fare concessions for children and pensioners and implement a fares increase of more than the 'RPI inflation + 1%' agreed in May.
Unions have also made clear that industrial action could be on the cards if ministers threaten staff pensions, pay or working conditions as part of the negotiations.
The Government gave an initial six-month package worth £1.6bn to the transport authority in May. Late last week ministers agreed to extend TfL's emergency funding for a further two weeks, after the previous funding package was due to expire on 19 October.
The mayor is asking for a £4.9bn settlement for the next 18 months to bail out TfL which is heavily reliant on passenger fares to support its revenue.
Mr Khan said: 'I want to be clear: the only reason that TfL needs Government support is because of the virus. Londoners are continuing to do the right thing by following the rules and reducing the number of journeys they make - Tube usage is down 70% compared to last year and has already fallen by 5% since London moved to Tier 2. Without fares income, we need government funding to keep our transport services running. These proposals are the latest in a series of measures which will damage our city.
'The Government wants to radically increase the size of the congestion charge zone, increase fares by more than inflation and strip away support for older and younger Londoners. London deserves its fair share - our city already contributes nearly £40bn a year more in taxes than it gets back.
'The Government’s proposal demands that Londoners pay twice in order to get the emergency funding TfL desperately needs – while we continue to support the rest of the country.'
The Department for Transport has been approached for comment.
The news comes after the Government failed to agree a package of support with Greater Manchester, in another acrimonious dispute that saw Manchster mayor Andy Burnham given only £22m after demanding at least a £65m package for the city region, which goes into Tier 3 lockdown from Friday.
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