Coronavirus: Transport for London secures emergency £1.8bn bailout

Transport for London (TfL) has secured a £1.8bn government bailout, to keep Tube and bus services running until March 2021.

The funding will ensure TfL can address its financial shortfall due to the loss of passengers as a result of Covid-19.

The exact amount of money involved is subject to passenger revenue in the coming months.

Mayor of London Sadiq Khan said the deal was "not ideal" but the government said it was "proof of our commitment".

Mr Khan said he fought hard against the "very worst" proposals, adding: "The only reason TfL needs government support is because its fares income has almost dried up since March."

Without a bailout the network would be forced to issue a Section 114 order, the equivalent of bankruptcy for a public company.

Discussions on longer-term sustainable funding continue, TfL said.

Amendments to the Congestion Charge introduced in June as part of a previous bailout - a 30% increase in the fee and longer operating hours - will remain in place due to the new deal.

Mr Khan said last month the government wanted TfL to extend the charging zone to the North and South Circular roads, covering around four million more Londoners.

Is that the sound of a can getting kicked down the road?

Both sides are declaring an element of victory in a negotiation that went down to the wire.

The mayor is pleased he has seen off an extension to the congestion charging zone but - and this is crucial - the government is pleased concessions for over 60s and under 18s will have to be paid for in the future by City Hall.

That could mean an increase in council tax. And don't forget fares will now be going up in January by inflation plus 1%.

The timing of this is also very interesting - it puts the renegotiations around a new deal right slap bang in the middle of a mayoral election campaign.

TfL Commissioner Andy Byford said: "The agreement will enable TfL to continue to support the capital for the remainder of the financial year as discussions on longer-term sustainable funding continue.

"Reaching this agreement with the government allows us to help London through this next phase of the pandemic."

Transport Secretary Grant Shapps said: "This deal is proof of our commitment to supporting London and the transport network on which it depends.

"The mayor has pledged that national taxpayers will not pay for benefits for Londoners that they do not get themselves elsewhere in the country."

Mr Shapps said he was looking "forward to working with London's representatives to achieve a long-term settlement, with London given more control over key taxes so it can pay more costs of the transport network itself".

TfL said it would receive a "core amount of £1bn", consisting of a £905m grant and £95m of borrowing.

Last month Boris Johnson claimed TfL was "effectively bankrupted" before coronavirus, and proposals to hike charges were "entirely the responsibility" of Mr Khan.

Mr Khan previously said TfL was spending £600m a month with hardly any income to cover those costs.