TfL has also been hit by the removal of a central grant from the government which as recently as 2015 amounted to £700m a year © Justin Tallis/AFP/Getty

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The mayor of London has warned the government that train and bus services will be slashed if ministers fail to provide £4.9bn over the next 18 months in a rescue package for the capital’s transport authority.

Sadiq Khan has told the Department for Transport that he is prepared to plunge Transport for London into “section 114”, a process for public authorities that is the equivalent of a company going bust.

That in turn would trigger strict spending restrictions and the withdrawal of many TfL services, according to allies of Mr Khan.

Speaking on LBC radio on Wednesday, the mayor said: “If a deal isn’t done, TfL will have no choice but to reduce the services we provide to make sure we can pay our bills and that means fewer Tubes running, fewer buses running, fewer trams running, fewer Overground trains.”

Fewer services mean buses and trains would be more crowded during the pandemic, he pointed out.

Section 114 notices are extremely rare and have only occurred at one public authority — Northamptonshire county council — in the last 20 years.

Mr Khan’s comments came after the Financial Times revealed that transport secretary Grant Shapps threatened to take direct control of TfL unless Mr Khan accepted a package of unpopular measures.

In a letter in early October, Mr Shapps told the mayor to accept measures including a higher council tax, a larger congestion charge zone and higher Tube and bus fares — in return for rescue funding.

The government gave an initial six-month package worth £1.6bn to the transport authority in May, which included the condition that Tube and bus services return to their normal levels after they had been slashed in the spring.

The idea of a larger congestion charge zone — which would stretch from the North Circular ring road to the South Circular in line with the expanded ultra low emissions zone — has alarmed Conservative MPs in the city.

On Wednesday some Tory MPs expressed fury at the idea that the policy was being imposed by Mr Shapps, who had previously insisted that the mayor had come up with the initiative at his own behest.

“They are taking us for fools,” said one Conservative London MP. “The idea seems to be that Khan takes the flak for an unpopular policy but it’s going to backfire badly.”

Bob Blackman, Tory MP for Harrow East, asked Prime Minister Boris Johnson in the House of Commons whether it was true that the government was seeking to impose the larger congestion zone.

Mr Johnson did not answer directly, instead claiming that Mr Khan had left a “massive black hole” in the finances of TfL before the pandemic struck.

“It is entirely his responsibility and any expansion of the congestion charge or any other measure taken to improve the finances of TfL are entirely the responsibility of the bankrupt current Labour mayor of London,” the prime minister said.

Critics point out that Mr Khan’s policy of freezing Tube fares has cost the body at least £640m in lost fare revenue.

However, TfL has also been hit by the removal of a central grant from the government, which as recently as 2015 amounted to £700m a year.

“Now is not the time for the government to play party political games or be vindictive towards London, this is far too serious a matter,” Mr Khan said at a meeting of TfL’s board on Wednesday. “I intend to stand firm and fight for a fair deal for Londoners.”

Letter in response to this article:

Little wonder TfL’s finances are a mess / From Peter Ford, London SW20, UK

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