The housing crisis will wage on if we don’t fix TfL’s funding problem
Stop-gap funding for TfL is not only worsening London’s transport system, but also its housing, writes BusinessLDN deputy chief executive Muniya Barua
Housing and transport will be hot political potatoes over the coming year with a Mayoral vote in May and a General Election at some point in 2024.
Just last week, Sadiq Khan announced £123m of additional funding to freeze Transport for London (TfL) fares for a year. We’ve also already seen the mayor and government clash over housebuilding in the capital, with the housing secretary recently appointing expert advisers to consider changes to the London Plan – the mayor’s spatial strategy for development – along with a war of words between mayoral candidates over industrial action on the Tube.
Fixing London’s housing crisis and delivering a sustainable and reliable transport network are essential prerequisites for growth. These two issues are often taken in isolation, but Londoners urgently need solutions that bring both together as part of a long-term plan.
According to Greater London Authority forecasts, by 2041 London’s populations will have grown significantly by 800,000 to 9.9m. This will add immense pressure on the Tube network which already regularly enables between 3m and 4m daily journeys Monday to Friday, while piling more even more pressure on London’s housing supply crisis. Providing the infrastructure for this growth is crucial to keep London at the top of its game. Without it, London and everything the city offers will be stuck in the slow lane.
Public transport in London is much more than simply getting from A to B. It is a vital public service that supports social mobility and inclusion, stimulates economic growth and enables firms to access a wider pool of talent for their businesses. TfL investment also underpins a UK-wide supply chain, which according to its latest analysis is worth £5.9bn in gross value added to the UK economy in the last financial year alone and supports more than 100,000 jobs across the country.
The one-year capital funding settlement agreed by TfL and the government just before Christmas provides some short-term certainty, but a multi-year funding deal must now be secured to enable London and suppliers across the country to plan for the future with confidence. There is a compelling case for doing so; not only would it keep London and its economy moving, but it would also go a significant way towards unlocking the housing that the city so desperately needs.
For example, in east London, the DLR extension to Thamesmead would unlock land for up to 30,000 homes and 10,000 jobs necessary to deliver the government’s vision for ‘Docklands 2.0’, connecting two major growth areas and four development sites in one go. In the south-east, the Bakerloo line extension could see more than 20,000 additional homes, creating new communities with excellent transport links.
TfL, as one of London’s largest landowners, is also doing its bit to leverage its transport activities to support new development through its property company, Places for London, which plans to deliver 20,000 new homes and 600,000 sq ft of workspace over the long term. That will help boost housebuilding in the capital and generate income to plough back into the transport network.
While the government committing more cash to funding the DLR and Bakerloo line extensions seems highly unlikely in the run up to an election, an alternative would be to give London government additional powers to help fund them. More broadly, confirming TfL’s capital investment budget in a timely manner would provide greater certainty to those seeking to invest in London, which in turn would provide developers with more confidence to invest to build more homes.
The government has already agreed long-term capital funding deals with Network Rail, National Highways and eight city regions across the UK. There is no good reason why London should not be added to this list in 2024. It would be a significant step towards addressing London’s perennial housing and transport challenges and boosting UK growth. A multi-year investment deal must be on the government’s new year’s resolution list.