Britain Needs To Spend More Money On London Transport

Harry Rosehill
By Harry Rosehill Last edited 54 months ago

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Last Updated 03 January 2020

Britain Needs To Spend More Money On London Transport

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Commuters rushing around Liverpool Street Station
Photo: Anna Dziubinska

London transport is underfunded, especially in comparison to the rest of the country.

That's according to an ever-so-slightly-incendiary report released by the Greater London Authority today. There has for some time now been a general perception that transport in the rest of the country is underfunded, and most of the investment is funnelled into London. This report challenges that opinion, and goes on to argue against pitting different regions of the country against one another.

Ironically, to prove this point, it starts by pitting different regions against one another. London's public sector rail expenditure per passenger per journey was around £8 in 2017/18, below the British average of £12. This despite London being — at least in part — home to 63% of rail journeys in Great Britain. And London's public expenditure on roads was at the lowest rate in the country in 2017/18, at approximately £16,400 per million vehicle miles. That's just over half of the UK average, £32,200 per million vehicle miles.

Graph depicting rail expenditure per person
Expenditure per rail passenger journey 2017/18. Source: GLA

The report states that London raises more tax than it receives — in essence funding the rest of the country. In 2017/18 London raised £150bn in taxes, but only received approximately £116bn. It then continues to argue that investing in London transport is good for the rest of the UK. The city's new electric buses are assembled in Falkirk, and the new Piccadilly line trains are to be built in Goole, Yorkshire.

The essence of the report is that investing in London's transport shouldn't be seen as being done at the expense of the rest of the UK. Instead, when London grows, the rest of the UK grows with it. That conclusion will probably do little to ameliorate those who believe that investment is over-concentrated in London.

The report goes on to conclude that the "current funding structures are insufficient to pay for London's long-term transport needs". In other words, new projects in the capital might not go ahead because of lack of funding — could Crossrail 2 be at risk?

Graph depicting regional contribution to public finances

To combat the emerging funding gap — an estimated £32 billion between now and 2041 — the report moots the idea of 'fiscal devolution'. That would see London receiving more of the taxation revenue it generates.

It is important to remember the perspective of this report. The GLA is an organisation with an extremely vested interest in guaranteeing funding for London, as it spends it. However, that doesn't mean the arguments made in the report should be dismissed out of hand, but rather considered carefully.

Heidi Alexander, Deputy Mayor for Transport, said: anyone who has ever experienced an overcrowded train will tell you, London's transport network desperately needs more investment.

If London is going to continue to succeed, Government can't wash its hands of its responsibilities. Ministers need to start the New Year by promising they will invest in transport infrastructure across our growing city. They need to realise this can't be a case of pitting one part of the country against the other and they need to recognise the wider benefits to the UK economy of investing in London.