TFL is given 11th hour bailout that will keep trains, tubes and busses running for two weeks as ministers hash out long-term deal with Mayor Sadiq Khan
The Government has agreed to extend its financial support of Transport for London for two weeks while negotiations on a new bailout continue.
Ministers are demanding that London's congestion charge zone is extended and free travel entitlements for children and older people are downgraded in return for what would reportedly be a £1 billion package.
Earlier today, Sadiq Khan was accused of 'playing games' after claiming that ministers are demanding he extends the congestion zone to get a £1billion bailout.
The London mayor faced fury over suggestions that the government had made the move a condition of the latest extraordinary cash injection to keep Transport for London from grinding to a halt, amid fears that could happen as early as this weekend.
After the latest agreement, Deputy mayor of London Heidi Alexander said there remain 'differences to resolve' between both sides, and expressed hope that 'cooler heads can prevail over the next 14 days'.
She told a meeting of TfL's finance committee: 'Neither the mayor or I can see how it would be right to charge people £15 to drive a mile from Wandsworth to Clapham, or from Catford to Lewisham, from October next year if the congestion charge was to be extended out to the North and South Circular.
'That is in effect what the Government have said to us that they want.
'We can't see why we should take free travel away from under 18s or over 60s when lots of people in London are actually facing some genuine hardship over the coming months.'
It is understood negotiations have stalled because of ministers' insistence that any such cash injection depends on the Mayor extending the congestion zone to the North and South circulars
There is 'collective responsibility' in Whitehall as well as City Hall to ensure Tubes and buses continue to run, she added.
TfL boss Andy Byford described the two-week extension as a 'sensible pragmatic solution' that 'keeps people's minds focused'.
He added: 'We can now get this deal done.
'We really are very close, and it's absolute top priority for all of us to get this thing across the line, and I believe that the two weeks will suffice.'
A spokesman for Mayor of London Sadiq Khan said: 'The two-week extension will enable TfL to continue running safe, reliable and frequent transport services - which is more critical than ever as the capital enters Tier 2 and with Covid cases on the rise.
'Sadiq will continue to fight for appropriate longer-term funding for TfL, and a fair deal for Londoners.'
A Department for Transport spokesman said: 'We have agreed an extension to the support period and to rollover unspent funding from the Transport for London Extraordinary Funding Agreement, allowing further time for negotiations for a new settlement.
'These discussions will ensure London has a safe, reliable network. It would be inappropriate to disclose further details at this stage.'
TfL's finances have been severely hit by the drop in travel caused by the coronavirus pandemic.
A £1.6 billion bailout agreed with Mr Khan in May put funding in place until Saturday.
It was reported last month that Mr Khan was seeking a £5.7 billion bailout to keep London's transport system going for the next 18 months.
Sadiq Khan is locked in urgent talks with the Government to secure a £1billion funding package before TfL burns through the last of its reserves, threatening to grind transport in the capital to a halt as early as this weekend. Tory mayoral candidate Shaun Bailey said: 'Under no circumstances would I back an extension of the congestion charge zone, regardless of who proposes it'
It comes as Sadiq Khan had been accused of 'playing games' after his claim that ministers are demanding he extends the congestion zone to secure the bailout.
Sources close to Mr Khan have been briefing that he was bravely resisting spreading the congestion zone to the North and South circulars, which would force up to three million citizens to pay £15 to use their cars.
But senior Tories raged that actually the mayor had gone to the Treasury with a 'begging bowl' and merely been told he needs to find some savings to help balance the books after years of mismanagement. They insisted and it was up to him how the money was found.
A senior Conservative source said: 'The fact of the matter is that he has been presented with a list of options. He is welcome to come up with his own.
'But he needs to say how he is going to make savings. Instead he is playing games in the media.'
They added: 'We have said how are you going to do it, these are some of the things you can do. He needs to find some ways of saving some money.'
The government has extended its emergency funding of TfL by two weeks to give more time to resolve the bitter wrangling over the huge sums needed to keep the transport system afloat.
The squabbling has been going on for months, with London Tory MPs increasingly frustrated about Transport Secretary Grant Shapps' refusal to take on the mayor's dire threats in public.
In May Mr Khan accepted a £1.6billion funding agreement with Government, which came with the condition of a hike in the congestion charge to £15. But he branded the injection a 'sticking plaster' and is calling for a £5.7billion long-term solution for the next 18 months.
However, government sources say they are determined that Mr Khan will not get a free pass after 'bankrupting' TfL with mismanagement during his tenure.
Tube and bus drivers have been warned that crucial transport services may stop running if the impasse is not broken over the coming days.
Highest proportion of adults travelling to work since lockdown easing, figures reveal
Around two-thirds of working adults travelled to their workplace over a period of seven days - the highest proportion since lockdown measures started to be eased, figures suggest.
Between October 7 and 11, 65 per cnet of employees said they travelled to work, either exclusively or in combination with home working, during the previous week, the Office for National Statistics said.
This is despite the Government urging people to work from home if possible on September 22.
The ONS said there is 'no indication that the longer-term trend of travelling to work has changed'.
Of the 980 working adults, 54 per cent said they exclusively travelled to work and 11 per cent said they had worked from home and commuted in.
It is the highest proportion since lockdown restrictions started easing at the end of May, the ONS said.
In other developments in the country's coronavirus battle:
TfL staff have been given a Section 114 warning, meaning that London's transport system could cease to function as early as this weekend, according to LBC.
A City Hall source told MailOnline TfL cannot simply 'turn London's transport system off overnight'.
But former head of buses and surface transport at TfL Leon Daniels disagreed and warned services could be stopped in a worst-case scenario.
He told LBC: 'As it would be with any business if you can't pay your obligations, can't pay for staff or contracts, can't pay your energy bill then you have to bring it to a halt, and that's the situation we're in now.'
Both Government and the Mayor say they are working urgently to thrash out a solution, but are at loggerheads over the conditions.
During the peak of the crisis TfL's revenues dropped 95 per cent as people were instructed to work from home and footfall on carriages fell. It has risen slightly since lockdown was initially eased after the first wave, but today Mr Khan said passenger numbers will not return to pre-pandemic levels in the immediate future
What are ministers' conditions for a £1bn TfL bailout?
A source close to Mayor of London Sadiq Khan has suggested the Government has set strict conditions in the event of any TfL bailout:
1. Expanding the congestion zone to the North and South circular.
The current congestion zone is marked by the inner London ring road and covers central London, including the City and West End.
If expanded to the North and South Circular, it will affect millions more people. The North Circular between Chiswick and Woolwich, stretching as North as Barnet. The South Circular stretches almost as far South as Streatham.
2. Taking away free travel for children and older people.
Currently children get free travel on London buses, while there is also a Freedom Pass for older people to get around the capital.
A source close to Mr Khan told MailOnline: 'Conditions such as extending a £15 congestion charge to the North and South Circular and taking free travel away from children and older people would be totally unacceptable to the Mayor and he would not ask Londoners to accept them in these exceptionally difficult times.'
Extending the congestion zone to the North and South Circular would hit the pockets of millions of Londoners, and has also come under fire from Conservatives.
Tory mayoral candidate Shaun Bailey said the only reason such revenue raising measures were being floated was because of financial mismanagement by City Hall.
Mr Bailey said: 'Khan has near bankrupted TfL and hung a closed sign over London.'
He added: 'Under no circumstances would I back an extension of the congestion charge zone, regardless of who proposes it...
'Any extension would hit hard working Londoners in the pocket and be a death knell for small businesses.'
Tory MP Bob Blackman told MailOnline: 'He's going with a begging bowl to the Treasury. He's wanting £5.6billion to keep TfL running over the next months.
'At which point, what? Is there a magic money tree? It is just ridiculous what he is asking for.'
TfL's finances have long been of concern, with the DfT reportedly drafting in KPMG to audit their accounts.
Mr Khan maintains that TfL's financial woes are down to plummeting passenger numbers during the pandemic.
During the peak of the crisis TfL's revenues dropped 95 per cent as people were instructed to work from home and footfall on carriages fell.
It has risen slightly since lockdown was initially eased after the first wave, but today Mr Khan said passenger numbers will not return to pre-pandemic levels in the immediate future.
He told LBC: 'I said back in May the deal we had for six months will be a sticking plaster, we need a sustainable deal.
'For the foreseeable future there will not be five million journeys on our Tube, five-and-a-half million on our buses.'
The Mayor added that the Government should not punish Londoners for 'doing the right thing' and avoiding public transport - especially when such conditions have not been imposed on private rail providers.
He said: 'The facts are that the Government gave the privatised rail operators 18 months funding with no strings attached, but is saying to TfL we'll give you a six-month deal with strings attached.'
Mr Khan's spokesman urged ministers to recognise that 'singling out Londoners for punishment is unacceptable and makes no economic sense'.
He added: 'We continue to discuss the next emergency funding package with Government and fight for a fair deal for London.'
His opposition was echoed by head of roads policy for the RAC Nicolas Lyes, who said: 'Expanding the Congestion Charge zone to the north and south circular areas would encompass a huge geographical area and would hit drivers and businesses hard in the pocket at the very worst time, with the pandemic severely impacting travel habits and finances.
'Drivers in London have already faced hikes in the existing Congestion Charge zone this year, as well as an increase in its hours of operation, so the introduction of further charges is totally unreasonable.'
Edmund King, AA president, said the furore over the congestion charge 'blows away once and for all any pretence that the charge is related to environmental improvement or reducing congestion'. 'It is simply a tax,' he added.
'It is highly ironic that this comes as many people are avoiding public transport due to Covid and some London boroughs have increased congestion with badly thought out road restrictions which are now causing a residents' revolt.
'Pushing through this excessive and socially regressive congestion tax which hits the poorest hardest will be a poll tax on wheels.'
Commuters wear face-masks during morning rush hour on the Victoria Line of the London Underground in central London today
Tube and bus passengers are rising, but Mr Khan said passenger numbers will not return to pre-pandemic levels in the immediate future
Coronavirus positive tests in London have increased dramatically since the beginning of September but changes in recent weeks suggest the rate of rise is slowing down, with a 37 per cent increase in the seven days to October 7, compared to the almost double 84 per cent in the third week of September
A TfL spokesman said: 'We continue to discuss our immediate funding requirements with the Government and hope these discussions can be concluded successfully soon, so we can help London through this next phase of the pandemic.
'We are doing what we can to minimise costs and aim to continue operating a full service across our network while our funding discussions continue.'
The Department for Transport refused to disclose the details of its funding offer but stressed that negotiations with the Mayor are underway.
A DfT spokesperson said: 'The Government continues to engage with Transport for London and the Mayor on the impacts of Covid-19 on TfL's finances.
'These discussions are ongoing and will ensure London has a safe, reliable network while delivering a fair deal to UK taxpayers.
'Discussions are underway, and it would be inappropriate to disclose further details at this stage.'
By Sam Blanchard for MailOnline
Devon, Oxford and Coventry all have higher coronavirus infection rates than London but will face no lockdown rules when the capital moves into Tier Two tomorrow.
Health Secretary Matt Hancock and London Mayor Sadiq Khan yesterday confirmed a ban on people meeting in indoor spaces will begin at midnight tonight in the city. The tough social distancing rule mirrors what is in place in Covid hotspots in the North of England, where the country's second wave is running rampant.
But London's infection rate is significantly lower than in those areas, and is below the average for the country as a whole, which is approximately 160 cases per 100,000. It is lower even than other areas that don't have any extra rules at all, abiding only by social distancing and the rule of six, according to Department of Health statistics.
While the 32 boroughs of London recorded an average of 99 Covid-19 cases per 100,000 people in the week up to October 10, the figure was 159 in Coventry and 154 in Oxford during the same period. Not a single borough of London currently has an infection rate that high, with the 147 in Ealing the city's highest.
It stood at 146 per 100,000 in Bristol, in Bournemouth there were 139 cases per 100,000, in Bath 115 and in Devon - driven by an outbreak in the university city of Exeter, where the rate is nearly 400 - the average was 106.
All those areas are in the South of England which is not facing any regional restrictions like the Midlands, North West and North East are, where some areas with lower infection rates are locked down to protect them from nearby outbreaks.
The entire of London may be heading into lockdown earlier than other areas - most of which have had significantly higher infection rates before facing new rules - because Mr Khan egged on the Government to toughen its stance in the city, and also because outbreaks can spread faster between boroughs because the population moves around so much.
It comes as Londoners are braced for the capital's transport system to grind to a halt this weekend as the cash-strapped TfL burns through the last of its funding. Eleventh-hour talks for a £1billion bailout between ministers and Sadiq Khan have stalled because of sticking points involving the Government's conditions for a deal.
The Mayor is understood to be refusing to sign up to an expansion of the congestion zone to the North and South Circular in particular. But rivals say he has been backed into a corner after 'bankrupting' TfL with mismanagement during his tenure in City Hall.
The decision to place London into a Tier Two lockdown today sparked fears around 200,000 people in the city's centre could lose their jobs in hospitality this weekend. An industry spokesman warned the drastic restrictions would see a 'maximum squeeze on revenue and no support'.
WHERE HAS HIGHER INFECTION RATES THAN LONDON BUT NO LOCKDOWNS?
Numerous areas have infection rates higher than the average number of Covid-19 cases per 100,000 people in London, which was 99 up to October 10, but remain at Tier One on the lockdown scale.
(London average calculated as the mean of individual areas' infection rates, not taking into account population differences)
Department of Health statistics, released yesterday afternoon, show huge variations in infection rates within the capital, but all will face the same 'high' lockdown rules from midnight tonight.
In Ealing and Richmond upon Thames, for example, there were more than 140 cases per 100,000 people in the most recent week where data is available for - this is the standard way of measuring a place's infection rate - while in Bexley the rate is just 69 per 100,000.
Matt Hancock's department yesterday claimed cases in the city are 'rising sharply' but local politicians have hit out at the decision to tar the whole city with the same brush.
Bob Blackman, the Tory MP for Harrow in west London - where cases are at around 121 per 100,000 people and where 304 people were diagnosed in the week to October 10 - said yesterday: 'Sadiq is going to be standing for re-election saying I am the mayor who closed London and threw the jobs under the train.
'I don't see that as a great approach. He's going to the Treasury with a begging bowl... It is ridiculous what he is asking for.
'Andy Burnham Mayor of is trying to protect and preserve Manchester, and understandably so. Sadiq Khan seems to want to take London into Tier Three. I don't know what the mad rush is to do it.'
Bromley and Chislehurst MP Sir Bob Neill said the 'one-size-fits-all approach' for the capital was a mistake.
The senior Conservative told Sky News: 'I think it's a mistake. I think it's disproportionate for the whole of London.
'I can see some parts of London the test is met, but… there is a cluster of south-east and southern London boroughs where the rates are very much lower.'
Wimbledon MP Stephen Hammond said he was surprised that the Tier 2 measures were being imposed across the capital.
'Yes, London infections are rising but they are rising at different rates in different parts of London, different levels of hospitalisation,' the senior Tory told BBC Radio 4's World At One.
'You are taking a very, very broad sweep and it's not clear that the Government has actually made the case that there should be a complete London-wide lockdown.'
One expert told MailOnline that the reason the whole city was lumped together may be because people are so interconnected it is impossible to separate the boroughs.
'We face such huge challenges for fairness and equity when considering lockdown,' Dr Ilan Kelman, an expert in health disasters at University College London said.
'London is especially hard due to its size and large rate of mobility via public transport. We also now have university students moving between their dorms and universities, even though university-related infections have been occurring around the country.
Hospital admissions in London increased 51 per cent in the fortnight between September 25 and October 9 – from an average 33 per day to 50 – which was half the rate of increase of the national measure for England
Deaths in London remain low at an average of four per day, compared to 60 daily across England as a whole. The measures, however, is always the last to rise and lags around a month behind infections
There are currently 77 patients on ventilators in intensive care in London, up from a low of 10 on August 7. For comparison, there are 135 ventilated patients in the North West, 116 in the North East and 468 across England as a whole
London Tube, train and bus staff are told to prepare for total shutdown of network THIS WEEKEND
Londoners are braced for the capital's transport system to grind to a halt this weekend as cash-strapped TfL burns through the last of its funding.
Eleventh-hour talks for a £1billion bailout between ministers and Sadiq Khan have stalled because of sticking points involving the Government's conditions for a deal.
The Mayor is understood to be refusing to sign up to an expansion of the congestion zone to the North and South Circular in particular.
But rivals say he has been backed into a corner after 'bankrupting' TfL with mismanagement during his tenure in City Hall.
In May, Mr Khan was forced to hike the congestion charge to £15 as part of a £1.6billion funding agreement with Government.
As that money prepares to dry up tomorrow, Tube and bus drivers have been warned that crucial transport services may stop running if negotiations remain deadlocked.
'We are in a no-win situation with too many losing so much. What we can do is to be fair to each other and act to help as many as possible, no matter what the tiers or the local variations.'
Sadiq Khan had suggested earlier in the week that a case rate of 100 positive tests per 100,000 people per week would be a 'trigger' point for sending an area into a Tier Two lockdown.
But numerous areas of the country have a rate higher than this and remain in Tier One, while London has been thrust into Tier Two as a precautionary measure despite the rate not yet hitting that level.
It appears to be the first place in the country where a lockdown has been brought in before a local crisis rather than as a reaction to one, and is the first time an entire region has been swept up in one move.
Places with rates higher than 100 but no local lockdowns, according to the most recent Department of Health data, include: Exeter (397); Coventry (159) and surrounding parts of Warwickshire including Rugby, Warwick and Stratford-on-Avon; Oxford (154); North Lincolnshire (150); Bristol (146); Bath (115); Bournemouth, Christchurch and Poole (139); Windsor and Maidenhead (114) and East Hertfordshire (102).
Many of the areas are in the South West which has been the least affected part of the country so far during the epidemic, likely because it has so few cities and the population is spread more thinly over rural areas.
Essex, Elmbridge, Barrow in Furness, York, North East Derbyshire, Chesterfield and Erewash are also being placed into the same Tier Two category from Saturday. All have higher infection rates than London, with rates above 100.
Under the new rules, household mixing will be strictly limited but offices and public transport can remain open, although the government's general advice to work from home where possible stands.
Former Conservative leader Iain Duncan Smith yesterday demanded to know whether London was being sacrificed to demonstrate the South was not being treated more leniently amid complaints from those in the North.
Manchester's Mayor Andy Burnham yesterday bemoaned that his city and the surrounding region were being treated like 'canaries in the coalmine' for the tougher local lockdown rules.
'London is huge,' Iain Duncan Smith said. 'Whether people like it or not it is very diverse and each of the boroughs, many of them are bigger than most of the towns in the rest of the UK,' he said in the Commons.
'Surely we need to look again at the nature of this London-wide Tier Two position because there could even be regional areas that could be taken out, there are big disparities.
'Please think again, otherwise, as one constituent has literally rang me today has said – is this in fact a London-wide Tier Two to stop the North/South divide argument running?'
Health Secretary Matt Hancock replied: 'No, just on the last point, absolutely not. The decision has been taken on the basis of the data across London.
'And we did consider the borough-by-borough approach that he understandably advocates, but the decision that we came to is because the cases are rising throughout the capital therefore it was right for the capital to move as a whole – and that was supported by the cross-party team who are working on this at a London level.'
London's Tory Mayoral Candidate Shaun Bailey said: 'Sadiq Khan's constant calls for lockdowns are hugely irresponsible. It's as if he wants people to focus on anything except his poor record as Mayor.
'I back the government's decision to put London into Tier 2. It's a sensible move that may help us avoid a lockdown while keeping Londoners safe.
'In the meantime, Sadiq Khan needs to stop governing by press release and start doing his job. That means reversing his congestion charge hike, sorting out his LTN schemes, and getting people safely back into central London.'
WHAT ARE THE THREE TIERS?
TIER 1/MEDIUM
TIER 1/MEDIUMTIER 1/MEDIUMTIER 2/HIGH
TIER 2/HIGHTIER 2/HIGHTIER 3/VERY HIGH: