Londoners face council tax hike amid TfL funding crisis

Londoners are facing a hike in their council tax bill as Sadiq Khan set out his plans to plug a Transport for London funding gap.

The mayor says he is being forced to increase council tax by £31.93 a year on average - or £2.66 per month - by the government who, he said, are "holding Londoners to ransom", in order to help prevent the capital's transport network from collapsing.

The £31.93 increase breaks down as £20 for transport, £10 for policing and crime and £1.93 for the London Fire Brigade. In total, Londoners will pay an extra £108 million to the Greater London Authority in council tax. Boroughs are likely to increase their bills by around five per cent on top of the rise in London precept collected for City Hall.

The Department for Transport has previously insisted it has “repeatedly shown its commitment” to supporting TfL during the pandemic by providing “more than £4 billion in emergency funding”.

The three-year hike in council tax would raise an estimated £172 million annually.

In addition, Mr Khan plans to increase the age of eligibility for free travel using the 60+ pass by 10% each year over the next 12 years.

Mr Khan said: “The sole cause of TfL’s financial problems is Covid-19 and, with the emergence of the Omicron variant and the new guidance to work from home, it’s never been more urgent for the government to agree a fair, sustainable, long-term funding deal for TfL – for the benefit of our capital city and the whole country.

“Train companies across the UK have faced the same emergency funding issues as TfL. In every case, the government has bailed out the private rail operators with long-term agreements. However, the government is treating London differently.”He said he refused to hike fares further after they were raised by 1% above inflation as part of the earlier agreements.Despite these measures, the Labour mayor said “managed decline” of TfL will still be required, involving “significant cuts” to bus and Tube services.Mr Khan said: “The pandemic is continuing to have a serious impact on London’s finances and the Government is still refusing to properly fund our public services, particularly the Met police, Transport for London and the London Fire Brigade.

“Raising council tax by £2.66 per month is not something I want to do, but the Government is leaving us with no choice if we are to help prevent the collapse of TfL and ensure our police officers and firefighters have the resources they need.”

A previous funding agreement between the Government and TfL was due to expire on Saturday December 11, but was extended until Friday.