The economic downturn is now the biggest challenge facing Mayor Boris Johnson as he sets his first budget for the capital. The Mayor is grappling with this challenge, while attempting to re-orientate City Hall to his new priorities. The Mayor’s Economic Recovery Action Plan sets out a detailed £3bn package of measures to get London back on track and through the economic downturn, including helping businesses, helping Londoners, and investing in London’s infrastructure and skills base to support long-term growth.
The report by the Assembly’s Budget and Performance Committee says Transport for London (TfL) is facing the risk of a significant shortfall in fare income. TfL is revising its 2009/10 budget to reduce operational expenditure in anticipation of this shortfall, which will have an impact on the services it provides. The organisation is already experiencing lower than planned growth in passenger journeys – the increase in passenger journeys in 2008/09 is less than half what TfL had planned for. The Mayor said:
“The severity of the economic downturn and its sharp impact on Londoners has required urgent practical action. I want to do all I can to ease the burden at this time, and have asked TfL to introduce a number of targeted fares reductions and concessions to help those on low incomes who will feel the impact most strongly.
“I want to help the thousands of Londoners who, during these tough times, will find themselves looking for work, by making it easier for them to get around the city when travelling to interviews and accessing other amenities that will help them find jobs .”
The Mayor has already introduced a number of targeted fares reductions and concessions, including reduced off-peak tube fares, half price bus fares for Londoners on income support, free travel for war veterans and the 24 hour Freedom Pass. Mayor of London, Boris Johnson, today announced that over the next year London’s half-price bus and tram travel scheme will be extended to include thousands of unemployed Londoners in receipt of Job Seeker’s Allowance (JSA) or the new Employment and Support Allowance (ESA). The move, which is part of the Mayor’s Economic recovery Action Plan, is designed to help people back to work by making it easier to travel to interviews, and access libraries, job centres, and other amenities. It means that from 1 April eligible Londoners in receipt of the allowances will be able to access the same half priced travel concession that those on Income Support currently benefit from. The extension means that around a further 150,000 Londoners should benefit from the scheme over the next 12 months. Those eligible for the discount represent some of the poorest people in London not already eligible for travel concessions, and the Mayor is particularly concerned to help this group through the current economic downturn. The discount will also help those who benefited from the previous Income Support discount scheme who have now been made ineligible by the changes to the benefits system that the Government has recently introduced. The extension will mean an investment of £3m for the year in terms of lost revenue.
The economic crisis will mean that emergency services may have to cope with changing patterns of demand. For example, the MPA told the Committee that it is expecting increases in crimes such as theft and burglary. Falling income from invested cash and plummeting property prices have also had an impact on the budgets of both the Metropolitan Police Authority (MPA) and London Fire and Emergency Planning Authority (LFEPA), which have had to revise their property strategies. In addition, the London Development Agency (LDA), as the agency for economic development and regeneration, has had to revise its plans in order to help London deal with the economic downturn.
