The Mayor indicated that he may increase his share of bills by more than five per cent to help cover the £125 million annual cost of maintaining free travel for under-18s and Londoners aged 60-65.
This is despite his admission that the council tax is “regressive” by disproportionately affecting people on lower incomes — and amid concerns that the boroughs are also planning a five per cent rise in their share of bills.
But he admitted that it may be illegal to maintain the central London congestion charge at £15 to fund the travel concessions as the primary purpose of the levy must be to tackle congestion, not to generate revenue.
Susan Hall, leader of the GLA Conservatives, told the Standard today: “It’s simply astounding that the Mayor is only considering hugely damaging ways to pay for these travel concessions.
“It would jeopardise central London’s recovery, and may be legally dubious, for him to use the congestion charge as a tax to pay for them. A boundary charge for driving into the capital would devastate outer London’s economy. And increasing the mayoral component of council tax would hammer struggling Londoners.”
Mr Khan is meeting TfL finance chiefs today in preparation for delivering its long-term funding plan to the Government. He told the London Assembly yesterday that he was not prepared to ditch free travel for children or to axe the 60-plus free travelcard, despite the latter being suggested by an independent panel of experts advising the Mayor.
Mr Khan said: “What I could do is agree with the Government and cut these concessions and remove free travel for under 18s and remove free travel for over 60s. I’m not willing to do that. The question for me is how I fund the money to pay for that.”
He is due to publish his council tax plans next month. He said “conversations were ongoing” with Ministers over increasing his share of council tax bills above five per cent to “fill the hole” in TfL’s finances to safeguard the travel concessions.
The Mayor has already revealed plans to cut the core City Hall budget from £640m to about £600m in anticipation of falling income from council tax and business rates.
Tube and bus fares are due to rise by 2.6 per cent on March 1. TfL expects its income from the C-charge, the ultra-low emission zone and the low emission zone that is paid by HGVs to increase from £408m this financial year to £762m in 2021-22 and £1,157m in 2022-23.
The 60+ Oyster photocard, which gives London residents free bus, Tube and train travel after 9am, was introduced by Boris Johnson as mayor in November 2012. At the time, Londoners had to be 61 to qualify for free travel.
Tory mayoral candidate Shaun Bailey today claimed TfL’s financial problems were due to “£9.5bn of waste” racked up by Mr Khan, with council tax payers now being required to foot the bill.
A London Labour source said: “The only reason TfL faces financial difficulties is because of Covid-19.
“The Tories are once again lying to Londoners. They know full well that it is their Tory government who are punishing Londoners by insisting on council tax rising in order to keep free transport for under 18s and older people.”