Londoners could pay an extra £294 million if City Hall uses higher council tax to fund free travel for children and pensioners in the capital, according to the Conservative Mayoral candidate.
Shaun Bailey said the Mayor may pass the cost of concessions on to residents, and warned that the share of council tax would have to rise more than £70 for Band D properties to pay for the policy.
According to Mr Bailey, in the City of London this represents an increase from £972.25 per year to £1,007.19 annually.
Sadiq Khan has not confirmed that he will raise council tax, and a spokesperson said the claims were “malicious”.
But the Mayor has not ruled out a tax hike or explained how he will pay for the travel concessions in future.
Over 60s have had free travel in London since the 1970s, with free bus travel and reduced train fares for children introduced in 2005.
But TfL’s finances have taken a significant hit during the coronavirus pandemic as fares collapsed: it has since had two bailouts from Government.
Ministers told Mr Khan to scrap free travel for children and ordered a cut back on free travel hours for pensioners under the terms of the first deal.
Following the most recent agreement, the Mayor will have the power to keep travel concessions – but they will have to be funded from his own budget, not subsidised by taxpayers elsewhere in the country.
Mr Khan has said he plans to keep the travel perks in place if he wins a second term in City Hall next May.
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He has not said how he will fund free travel, but the bailout named three proposals from TfL and the Mayor – keeping the higher congestion charge rate and expanded hours introduced in June, raising council tax, or a combination of the two.
The congestion charge previously operated from 7am to 6pm on weekdays, with drivers paying £11.50 to access city centre roads.
Since June, the charge has run from 7am to 10pm seven days a week and costs £15 a day.
Mr Khan has previously said the change to the congestion charge would be temporary, and opposed Government proposals to extend the charge up to the North and South Circular roads next year.
He has also said he views council tax as “regressive” because it hits poorer people harder, but has not ruled out an increase.
But Mr Bailey believes a tax rise should be off the table, and the Mayor should slash spending at TfL instead.
The Conservative candidate wants to downgrade network pensions, reduce union time for staff, and cut free travel for family and friends of TfL employees, among other plans to save money.
“Leadership involves tough decisions, but this fact seems to have passed Sadiq Khan by,” he said.
“The Government have been clear: they will cover the cost of Covid, but they won’t cover the cost of Sadiq Khan’s mismanagement. Londoners shouldn’t have to either.”
To fully fund free travel through council tax, the Mayor would have to raise the Greater London Authority precept – the amount he tells councils to raise on his behalf – by around £70 for Band D properties, Mr Bailey claimed.
This calculation is based on the amount of tax raised this year by increasing the precept, and the amount needed to cover the travel concessions.
Conservatives say residents in Kingston, Richmond and Harrow would face the highest bills, with Band D council tax rising above £2,000 a year for a Band D property in Kingston, and over £1,900 in Richmond and Harrow, before factoring in any increase from the councils themselves.
Those paying less council tax to begin with would fare best – in Westminster and Wandsworth the bill would still be less than £900, and under £1,200 in Hammersmith and Fulham.
But a spokesperson for the Mayor dismissed the claims as “fantasy figures” and said no decision has been taken on a tax increase.
“The only reason TfL faces financial difficulties is because of Covid-19,” they said.
“Sadiq saved free travel for under 18s and over 60s from the Tory government who wanted to scrap them – as well as killing off the the Tory plans to expand the Congestion Charge – while the Tory Mayoral candidate put loyalty to party above Londoners and said nothing.”
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