What’s the Fare Deal?
Ken Livingstone’s Fare Deal pledge to Londoners if elected in May:
- Cut fares by 7% and cut bus fares from £1.35 to £1.20 (11% cut) in an emergency fares package in October 2012
- Freeze fares completely in 2013
- No above-inflation rises after that.
What’s Boris Johnson’s policy?
Boris Johnson is committed to raising fares by 2% above inflation every year.
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Soaring fares are not necessary. Each year Londoners pay far more in fares than even the Mayor’s own budget projections say they will. TfL consistently has a surplus on its operating budget and last year this was £729mn. This operating surplus grows every year. This is an excess in the budget, over and above the projected budget. Ken’s policy is to put that money back into Londoners’
pockets and purses.
We will carry out this ‘Fare Deal’ without cutting future investment or hitting services, which are funded by a separate budget. Like Labour’s VAT cut it will help ease the pressure on people who are being squeezed and help the London economy.
The clear choice in the election leads to hugely different outcomes for Londoners. The average Londoner will be around £1000 better off over 4 years under Ken’s policy. Put another way, under Boris Johnson ordinary Londoners will be £1000 worse off, and the sole beneficiary will be TfL’s bank balance.
In tough times like these, Londoners can’t afford a mayor who is so out of touch that he is raising transport fares, cutting police numbers and thinks it’s okay to have a second job paying £250,000 a year – an amount he calls ‘chicken feed’.
Ken Livingstone understands how most people are struggling under the impact of tough economic times and higher prices, including fares.
Is it affordable?
TfL say the fares reduction will diminish their revenues by £215mn per year. This probably doesn’t take account of the usual increase in fare-paying ridership that tends to happen when fares are cut or frozen. But even if the TfL assessment is correct, this would only have reduced last year’s operating surplus of £729mn to £514mn.
The average operating surplus under Boris Johnson has already been higher than £215mn over the last 3 year and will rise further with fare increases.
Won’t it hit investment in the network?
The Tories claim the transport network will be hit by the fares cut. But the operating budget is entirely separate from the capital budget, so investment will be unaffected. The Tories’ claims are completely false as, under Boris Johnson there has also been a consistent surplus on the capital budget too – £208mn last year and an average of £239mn per year under Johnson. This means that
large sums allocated to investment simply aren’t being spent.
Ken Livingstone has been a strong advocate of investment in the network, securing the biggest transport investment programme since the Second World War, with key new transport links like the East London Line extension, working to secure the go-ahead for Crossrail and overseeing the revival of the bus service.
In addition to the under-spend on the capital budget, Ken will come forward with a series of measures that will fund a significant increase in investment in the network.
How is the £1000 saving calculated?
The actual fare increases under Johnson have been compared to where these fares would now be under Ken, from his announced policy. These range from the lowest annual saving in 2016 under Ken of £228.80 for a weekly 1-2 Zone Travelcard to £395.20 for a weekly 1-6 Zone Travelcard.
Therefore the average saving for Londoners will be at least £1000. In reality it is likely to be more as the starting-point for all fares in 2012 is much higher than the starting-point of this comparison which was 2008.
Doesn’t this affect Londoners differently?
Yes, depending on how frequently Londoners travel, their mode of travel and the zones they travel between. The £1000 saving is an average number. But the biggest benefits are to outer Londoners who commute in, and the poorest Londoners who rely on public transport the most.
Learn more about Ken’s Fare Deal for London.