Where's the Grand London Express?

Tuesday's commitment by Sadiq Khan to extend the Superloop bus network from Lewisham to Elephant & Castle hasn’t been universally welcomed. Some of that I pin on a snobbishness about buses (as a reminder - buses carry more people in London on a daily basis than the tube). But a good chunk of the criticism is directed at what they perceive as a paucity of ambition, seeing a bus route as a poor substitute for the Bakerloo Line extension (BLE), whose route it mirrors.

To give Khan credit, delivering on a new Superloop bus network is something he can do quickly if he’s re-elected – Transport for London can just get on and do it. Nor do I think for one minute Khan has given up on the BLE. Instead, he knows better than most that no mayoral candidate can credibly promise to build it, as the city hasn’t the money to pay the estimated £8bn cost.

So again we face the age old question – how is London to fund new infrastructure? London’s new and upgraded transport projects since 2000 have almost exclusively been funded via substantial support from central Government. TfL is good at covering day to day costs and maintenance from fares and other income (and recently delivered its first operating surplus), but it relies on the Treasury for the big ticket items - new lines, modern trains and signalling, DLR extensions and station rebuilds.

The two big outliers are the Elizabeth Line and the Northern Line extension to Battersea Power Station – both required more complicated funding mechanisms that saw London, Londoners and the capital’s businesses contribute to the cost. But both feel like exceptions – built in spite of the odds against them, and only happening through sheer bloody mindedness by key individuals and organisations that broke the Treasury’s resistance. 

However, the pipeline is running rather dry. That’s despite London’s wish list – as well as BLE this includes extending the DLR to Thamesmead, a new West London Overground line, Sutton Tramlink and Crossrail 2. All would unlock serious development opportunities – up to 110,000 new homes for the BLE alone. But the Government shows little inclination to fund these projects. Nor, for that matter, has a Labour Party potentially on the cusp of power.

So how will London fund new infrastructure if central Government is unwilling to get out the chequebook? A solution would be to allow London to keep more of its own income and decide how to spend it. Not only would the city reap the financial benefits of investment decisions – creating clear incentives - but it would free up a central government reluctant to spend big bucks in the capital.

In the time London took to build the Elizabeth Line, Paris built five equivalent RER lines. Paris isn’t stopping there – their Grand Paris Express project will see four new lines, 68 new stations and 200km of new track – including a new outer orbital line. With Crossrail open, and Crossrail 2 looking decades away, London risks being left behind by our near neighbour and (friendly) rival.

The current Mayoral campaign has once again exposed how London government’s chronic lack of financial independence makes it impossible for the city to get on and copy Paris. All the candidates surely agree major devolution of fiscal powers is essential if London is to build the infrastructure it desperately needs. How London actually gets more control is a much harder question to answer.

Nick Bowes, Managing Director (Insight) - LCA

This is a slightly edited version of the introduction to this week's LCA LDN Newsletter. You can sign up here to receive LDN direct to your inbox every Wednesday, along with thousands of London's decision makers and opinion formers.