Transport for London furloughs 7,000 staff to save £15.8million a month as network’s finances are hit by 90 per cent slump in fares
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Transport officials in London will furlough a quarter of their workforce from next week to save £15.8million every month due to the coronavirus lockdown.
Transport for London said 7,000 staff whose work has been reduced or paused will be affected from Monday in the move amid the huge financial impact of the crisis.
TfL will access funding from the Government’s job retention scheme after Tube journeys fell by 95 per cent and bus use by 85 per cent since last month’s lockdown.
It can now get funding for 80 per cent of the salary of furloughed staff – who will be on the scheme for at least three weeks – up to a maximum of £2,500 a month.
TfL, which employs 28,000 people and has seen fare revenues drop by 90 per cent, said it will make up the rest of salaries and continue to pay pension contributions.
Commuters wait to board a Jubilee line train at Canning Town station in East London today
TfL said its main source of income has almost ‘disappeared’ after people were urged only to make essential journeys to help curb the spread of the virus.
A limited service is now in place for key workers, and London Mayor Sadiq Khan has warned transport ‘will not immediately return to normal’ after the lockdown.
London’s transport commissioner, Mike Brown, said: ‘The transport network is crucial in the fight to tackle coronavirus and it will play a similarly vital role in supporting the country’s economy as it recovers from the pandemic.
‘We have significantly cut our costs over recent years but nevertheless the success of encouraging the vast majority of people to stay at home has seen our main revenue, fares, reduce by 90 per cent.
A passenger wears a face mask on board an Underground train at Canning Town station today
‘We are now taking steps to use the Government’s Job Retention Scheme to further reduce our costs where work has been paused because of the virus, while at the same time supporting our staff financially.
‘Our work with the Government about the support that we need are ongoing and are constructive. We hope for an urgent agreement so that we can continue to provide the city with the vital transport it needs now and going forward.’
It comes after Mr Khan warned on Wednesday that TfL could be forced to cut services unless it receives Government funding in the coming days.
The Mayor said that TfL had lost hundreds of millions of pounds of revenue due to the coronavirus lockdown.
Passenger numbers were down around 95 per cent on the Tube and 85 per cent on buses, cutting income from fares to a fraction of normal levels.
Passengers walk down a set of stairs at Canning Town station in East London this morning
Mr Khan said: ‘Unless the Government gives us a grant, we will not be able to continue to run the service we have.’
London Mayor Sadiq Khan has warned transport ‘will not immediately return to normal’ after the lockdown.
He explained that TfL had been using its cash reserves to continue operating services and paying staff.
But he warned it would be ‘really difficult for us to continue the way we have’ unless a deal was secured with the Department for Transport by the end of the month.
He added: ‘We rely upon fares from customers to pay for our services.
‘Unfortunately, the Government cut the operating grant from TfL three years ago. We’re the only public transport system in the world without a grant from central government.’
Despite the huge reduction in overall passenger numbers, concerns have been raised that some services are overcrowded, putting essential workers such as healthcare staff at risk of being infected when they commute.
This issue – which the mayor blamed on staff being unwell or self-isolating – could be worsened if services were cut due to a lack of money.
Andy Burnham and Steve Rotheram, the metro mayors for Greater Manchester and the Liverpool City Region respectively, have called for Government funding to support city centre transport.
Mr Burnham said Manchester’s Metrolink system may have to be suspended as it was losing millions of pounds a month.
Merseyrail, which operates in Liverpool and surrounding areas, was losing £1.2million a week and was being reduced to a core service for essential workers, Mr Rotheram said.
Last month, the Department for Transport (DfT) suspended traditional rail franchise agreements to avoid train companies collapsing, but the metro mayors said the rail systems in their cities had not been given any support.
A DfT spokesman said: ‘We are aware of the challenges faced by transport operators, and continue to work closely with the sector and transport authorities to ensure passengers can make essential journeys.’
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