The company had been greatly affected by the coronavirus pandemic, revealing last month the revenue made through its fares had dropped by 90% in the wake government advice to stay at home and only make essential trips.
What are the conditions of the TFL bailout and what will it mean for passengers?
What is the TFL bailout?
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The transport company has secured £1.6bn in emergency funding to keep Tube and bus services running until September.
Under the bailout, it’s expected that there will be a full Underground service restored as soon as possible, reports the BBC.
BBC London Political Editor Tim Donovan also reports other measures of the bailout include:
- Stay Alert advertisements being used across the network
- Reporting staff absenteeism rates to civil servants
- A longer-term review of TfL finances
Will tube fares go up?
Yes, as part of the agreement, London Mayor Sadiq Khan has agreed to increase bus and Tube fares by 1% above inflation.
This goes against a price freeze promise made by Khan late last year.
Had TFL run out of money?
Before the bailout was confirmed, it was revealed by Sadiq Khan that TFL would’ve run out of money by the end of Thursday 14 May.
Speaking to LBC, Khan said: ‘Over the last two months, we’ve lost more than 90% of our fares, advertising is down and so is the congestion charge. We’ve been spending £600 million a month to offer services and get nothing back.
‘At the start of this crisis, we had a cash reserve of more than £2.1 billion. That’s running out. We’re required by law to keep two months’ worth of money in reserve to pay for services.
‘We’ve been involved in weeks and weeks of negotiations with the government and it is really hard to get support from them. Being blunt, today is the last day.’
What is a section 114 notice?
If the bailout wasn’t approved, TFL would’ve filed what is known as a Section 114 notice.
This is the equivalent of a public body going bust and not being able to meet the operational costs.
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