TfL says London’s roads are being subsidised by public transport users. Is it true?

Traffic in London in 2005. Image: Getty.

Are public transport users subsidising London’s roads?

The idea sounds faintly ridiculous, because it goes against all received wisdom. Everyone knows that it’s public transport that gets all the subsidies, right? Poor old drivers are taxed through the nose. Right? Right?

Nonetheless: “passengers subsidise motorists” is now the official line over at Transport for London (TfL). From its latest business plan:

From next year we have to, for the first time, address the critical issues of London’s road network, including congestion, road danger, maintenance and air quality, without any Government operating grant. Furthermore, from 2021, the £500m raised every year from Londoners paying Vehicle Excise Duty will be collected by central Government and only invested in roads outside the Capital.

This means the net operating costs of London’s roads, currently almost £200m each year, and the cost of renewing these roads, between £100m to £150m each year, are effectively being cross subsidised from fare-paying public transport users.

The next paragraph gets a bit “go ahead punk, make my day”. Emphasis mine:

This is neither sustainable nor equitable. As a result, in the short to medium term we will have to significantly reduce our programme of proactive capital renewals on the road network, although we will ensure safety of the network is maintained

There’s a certain amount to unpick here. It’s true that TfL has historically had a grant from central government: that comes from the Department of Transport, and is paid via the Greater London Authority.

And, yes, that grant is indeed tapering off. That’s been happening since April 2013, and will conclude in 2019-20, making 2021 the first year that TfL will operate without a penny of cash from central government. TfL’s responsibilities, what’s more, do include a certain amount of maintenance of London’s road network, and the budget puts their cost at £350m per year.

Since the tax road users pay – Vehicle Excise Duty – is going to central government, and by 2021, central government won’t be giving TfL a penny – and since it’s true that TfL does get most of its money from public transport fares – then, yes, TfL is maintaining London’s roads using cash provided by public transport users rather than drivers.

But there are three things which slightly complicate this argument. One is that TfL isn’t the only body investing in London’s roads: the boroughs and Highways England are also involved. So central government money may still arrive by other means.

Another is that fares aren’t the only source of revenue for TfL. Okay, they’re a big one (see below). But as TfL itself admits, that central government grant has been replaced by Business Rates – a form of property taxes – retained by the GLA. “Businesses subsidising London’s road” doesn’t make for quite as sexy a headline.

TfL’s sources of income, as shown in its 2017-18 budget.

Another complicating factor is that Vehicle Excise Duty is, despite what shouty drivers like to yell at cyclists, not actually a road tax. The money was briefly hypothecated for road maintenance – in the 1920s and 30s. Since 1937, though, it’s just been a form of general taxation: maintenance is also funded from income tax, VAT, and so on.

And so, it’s a bit silly to argue that the money London’s drivers pay to maintain London’s roads is not going to London’s roads because they don’t really pay to maintain London’s roads, and that’s been true for 80 years.

But all this feels like nit-picking. It is true that TfL gets a lot of money from public transport users, and remarkably little – central London congestion charge aside – from drivers. That, given that cars cause pollution and congestion while trains, trams and bikes don’t, feels like the wrong way round.


And, for what it’s worth, the claim that public transport users are subsidising roads is one I first heard from a TfL staffer a couple of weeks back. Even if TfL doesn’t believe it’s true, it’s clearly decided to convince us that it’s true.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and also has a Facebook page now for some reason. 

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Coming soon: CityMetric will relaunch as City Monitor, a new publication dedicated to the future of cities

Coming soon!

Later this month, CityMetric will be relaunching with an entirely new look and identity, as well as an expanded editorial mission. We’ll become City Monitor, a name that reflects both a ramping up of our ambitions as well as our membership in a network of like-minded publications coming soon from New Statesman Media Group. We can’t wait to share the new website with you, but in the meantime, here’s what CityMetric readers should know about what to expect from this exciting transition.  

Regular CityMetric readers may have already noticed a few changes around here since the spring. CityMetric’s beloved founding editor, Jonn Elledge, has moved on to some new adventures, and a new team has formed to take the site into the future. It’s led by yours truly – I’m Sommer Mathis, the editor-in-chief of City Monitor. Hello!

My background includes having served as the founding editor of CityLab, editor-in-chief of Atlas Obscura, and editor-in-chief of DCist, a local news publication in the District of Columbia. I’ve been reporting on and writing about cities in one way or another for the past 15 years. To me, there is no more important story in the world right now than how cities are changing and adapting to an increasingly challenging global landscape. The majority of the world’s population lives in cities, and if we’re ever going to be able to tackle the most pressing issues currently facing our planet – the climate emergency, rising inequality, the Covid-19 pandemic ­­­– cities are going to have to lead the way.

That’s why City Monitor is going to be a global publication dedicated to the future of cities everywhere – not just in the UK (nor for that matter just in the US, where I live). Our mission will be to help our readers, many of whom are in leadership positions around the globe, navigate how cities are changing and discover what’s next in the world of urban policy. We’ll do that through original reporting, expert opinion and most crucially, a data-driven approach that emphasises evidence and rigorous analysis. We want to arm local decision-makers and those they work in concert with – whether that’s elected officials, bureaucratic leaders, policy advocates, neighbourhood activists, academics and researchers, entrepreneurs, or plain-old engaged citizens – with real insights and potential answers to tough problems. Subjects we’ll cover include transportation, infrastructure, housing, urban design, public safety, the environment, the economy, and much more.

The City Monitor team is made up of some of the most experienced urban policy journalists in the world. Our managing editor is Adam Sneed, also a CityLab alum where he served as a senior associate editor. Before that he was a technology reporter at Politico. Allison Arieff is City Monitor’s senior editor. She was previously editorial director of the urban planning and policy think tank SPUR, as well as a contributing columnist for The New York Times. Staff writer Jake Blumgart most recently covered development, housing, and politics for WHYY, the local public radio station in Philadelphia. And our data reporter is Alexandra Kanik, whose previous roles include data reporting for Louisville Public Media in Kentucky and PublicSource in Pittsburgh, Pennsylvania.

Our team will continue to grow in the coming weeks, and we’ll also be collaborating closely with our editorial colleagues across New Statesman Media Group. In fact, we’re launching a whole network of new publications this fall, covering topics such as the clean energy transition, foreign direct investment, technology, banks and more. Many of these sectors will frequently overlap with our cities coverage, and a key part of our plan is make the most of the expertise that all of these newsrooms combined will bring to bear on our journalism.

City Monitor will go live later this month. In the meantime, please visit citymonitor.ai to sign up for our forthcoming email newsletter.


As for CityMetric, some of its archives have already been moved over to the new website, and the rest will follow not long after. If you’re looking for a favourite piece from CityMetric’s past, for a time you’ll still be able to find it here, but before long the whole archive will move over to City Monitor.

On behalf of the City Monitor team, I’m thrilled to invite you to come along for the ride at our forthcoming digs. You can already follow City Monitor on LinkedIn, and on Twitter, sign up or keep following our existing account, which will switch over to our new name shortly. If you’re interested in learning more about the potential for a commercial partnership with City Monitor, please get in touch with our director of partnerships, Joe Maughan.

I want to thank and congratulate Jonn Elledge on a brilliant run. Everything we do from here on out will be building on the legacy of his work, and the community that he built here at CityMetric. Cheers, Jonn!

In the meantime, stay tuned, and thank you from all of us for being a loyal CityMetric reader. We couldn’t have done any of this without you.

Sommer Mathis is editor-in-chief of City Monitor.