Good rail results for TfL

Population and economic growth again set new passenger journey records for London Underground, but bus journeys continue to flat-line and are now lower than five years ago. These are just some of the findings from TfL’s latest annual report & accounts for the year ended 31 March 2016.

Total TfL income increased 5.0% to £5.289bn (2014/15: £5.039bn), of which revenue from rail and bus fares accounted for £4.258bn (2014/15: £3.989bn). Total TfL gross expenditure, however, increased slightly more by 5.4% to £7.436bn (2014/15: £7.055bn), resulting in an overall shortfall of £2.147bn (2014/15: £2.016bn).

The funding gap was bridged by a  £3,511bn grant (2014/15: £4.560bn); this, plus a few other small items resulted in an annual surplus before taxation of £1.006bn (2014/15: £2.304bn). The grant consisted of three parts: revenue £0.848bn (2014/15: £1.071bn); capital £1.854bn (2014/15: £1.877bn); and Crossrail £0.809bn (2014/15: £1.612bn).

TfL debt increased 7.0% to £9.113bn (2014/15: £8.514bn). The 2015/16 limit of £10.377bn was set by the London Mayor.

TfL is required to be self-sufficient and cover its operational costs from 2019:

“The outcome of the (November 2015) Spending Review means that while the capital grant was protected, our revenue grant will be progressively withdrawn. From 2019 we will cover all day-to-day running costs from our own income. This means that London will be the only major world city transport network not to require an operational subsidy from central Government,” says the report.

According to TfL’s segmental analysis, LU is already in the ‘black’ with income exceeding expenditure:

 

Source: TfL
Source: TfL

However this analysis does not include the full costs; the main exclusion was the £1.119bn depreciation (2014/15: £1.040bn). If added back the result looks less favourable.

Elsewhere separate figures are given for revenue and operational expenditure. The revenue total is the same (but apportioned differently), but the expenditure total is considerably greater (since it includes depreciation).

2015/6 (£m) London Underground London Rail Surface Transport Other income Total
Income (fares) 2,559  473  1,526    731   5,289
Expenditure 2,676  584  3,171 1,005   7,436
 Surplus/(loss)   (117) (111) (1,645)   (274) (2,147)

 

2014/5 (£m) London Underground London Rail Surface Transport Other income Total
Income(fares) 2,410  336  1,538   755   5,039
Expenditure 2,630  421  3,098   906   7,055
 Surplus/(loss)   (220) (85) (1,560) (151) (2,016)

And the TfL LU business unit had a different revenue apportionment (though the £5,289m revenue total remains the same), namely: London Underground £2,729m (2014/15: £2,620m); London Rail £500m (2014/15: £351m); Surface Transport £1,995m (2014/15: £2,019m); and other categories £65m (2014/15: £49m).

Explaining the reason for these discrepancies in the LU revenue totals, a TfL spokesman informed 21CR :

“The figure of £2,559m  is solely fares revenue in London Underground Limited. The figure of £2,729m on  is total revenue (including revenues from other sources – including rents, commercial advertising and other miscellaneous sources of income) in London Underground Limited as prepared on a statutory basis.

“The figure of 2, 740.7m   is the income figure reported for the London Underground Business unit as reported on a management reporting (“Activity” basis).Under Activity reporting, the split of revenue between business units is not exactly aligned to the statutory split on a legal entity basis.”

London Overground (LO) revenue was 79.9% up at £286m (2014/15: £159m); the sharp increase  reflected the transfer of Liverpool Steet’s  services to TfL from Greater Anglia from May 2015. Liverpool St to Shenfield services were also transferred to TfL Rail (part of Crossrail) at the same time.

DLR experienced a more modest revenue boost of 8.2% to £158m (2014/15: £146m). (LO and DLR both come under London Rail).

Total TfL capital expenditure was £4.088bn (2014/15: £3.588bn), with the following breakdown: Crossrail £1.558bn (£1.526bn); LU £1.257bn (2014/15: £1.354bn); Surface Transport £0.512bn (2014/15: £0.399bn); London Rail £0.233bn (2014/15: £0.278bn); and other categories £0.528bn (2014/15: £0.031bn).

Total spend on Crossrail to date has been around £9bn. The project is now 75% complete and is on time and within budget.

 

Passenger numbers (millions) 2015/16 2014/15 Growth
LU 1,349.0 1,305.0     3.4%
LO     184.4    139.8   31.9%
DLR     117.0    110.2     6.2%
Trams      27.0      30.9 (12.6%)
Buses 2,314.0 2,385.0   (3.0%)

 

 

Kilometres operated (millions) 2015/16 2014/15 Growth
LU   82.5   80.3    2.8%
LO   10.5     7.8  34.6%
DLR     6.0     5.8    3.4%
Trams     3.0     3.0      –
Buses 492.0 489.0    0.6%

 

London Underground breached the one billion journeys per year marker in 2007 and continues to go from strength to strength.

The slight decline in bus journey numbers is attributed to road congestion brought about by major construction projects. The current level is lower than the 2,320 million passengers recorded in 2011/12.

The poor tram figures are due to the ongoing improvement works that have disrupted services for some time.

Annual report & accounts 2015/16

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