Readers from Manchester, Leeds and Glasgow look away now. Instead of reading this article they would be better off drafting a letter to the transport secretary, Philip Hammond, demanding that London's commuters take their fair share of multi-billion pound spending cuts – because the lobbying campaign by the capital has started in earnest.
Peter Hendy presides over a £9bn budget at Transport for London, with passengers making 2.2bn bus journeys and 1bn London Underground trips every year, on behalf of the mayor, Boris Johnson. His belief that the capital ought to be spared the worst of any swingeing cuts in the Department for Transport's budget is just as strong as his London accent. "If you are short of money you should invest in the best place you can," says London's transport commissioner, overlooking TfL's domain from the 14th floor of its central London headquarters. "If that produces a pro-London focus, then that is a consequence of a policy that the government has espoused, which is to say that the focus [on deciding where to cut] should be on economic growth."
According to a study from the Oxford Economics forecasting group, London's economy could grow at 3.8% a year up to 2015 and generate 385,000 new jobs – more than the estimated employment created by Wales, Scotland, the Midlands and north England combined over the same period.
But that must be balanced against a sizeable funding settlement from the Department for Transport that was agreed before the meltdowns in the City and Greece. Under current plans, TfL will receive a vast £39bn up to 2018, including its contribution to the £16bn Crossrail scheme. In this financial year it will receive about £3.5bn from the government – nearly a quarter of the DfT's total £15.9bn annual budget. So, if the DfT is to cut either 25% or 40% of its spending – as required by the government spending review – TfL must be in its sights.
The Treasury knife could be sharpened by a sense of perceived injustice from cities north of the Watford gap.
Vital
Norman Baker, the Liberal Democrat transport minister, hinted at a serious funding disparity when he told the Guardian this month that there was a "feeling" that London "gets a very good deal." He added that the DfT must "not be seen to advantage one part of the country over another".In an argument that echoes Network Rail, whose spending on Britain's rail tracks and stations accounts for a further quarter of the DfT's annual spend, TfL says it looks after vital infrastructure that is already subject to tough spending cuts.
Indeed, cost saving programmes at TfL and Network Rail were announced long before the Conservatives put the frighteners on the public sector. "Boris and TfL were in the advance party of the vanguard of the government's drive for efficiencies," says Hendy, referring to a commitment to remove £5bn from TfL's budget by 2018. "Some allowance ought to be given for that in the forthcoming expenditure cuts."
Hendy adds that some other transport schemes, including Network Rail projects, might be better candidates for the chop: "There are other national schemes which, in view of the economic crisis, and in view in the passenger downturn in some parts of Britain, may not be so critical as preserving the ability of London to generate growth. Philip Hammond should make sure that he does not hamper the ability of London to generate growth.
"You will find plenty of people with a regional focus who will resent the amount of money being spent on London – but there is not a city in Britain that has anything like the amount of public transport users travelling to work that London does."
Under the baleful gaze of the rest of the UK, Hendy and Johnson are herding billions of pounds worth of projects into a no-cuts zone. They want to preserve Crossrail, which will build two underground rail lines between Heathrow Airport and Canary Wharf, and to introduce faster and more frequent services on the Northern, Piccadilly and Bakerloo underground lines. Spending on the Northern, Piccadilly and Jubilee lines alone has been budgeted at more than £4bn over the next seven years. Hendy points out that fares – which bring in half of TfL's funding – are already rising steeply, climbing by 12.7% on the bus network this year and 4% on the tube.
"Boris is absolutely determined that he will not lose Crossrail and he will not lose the upgrades. He put up bus fares by 12.7% and he does not want to do it again. He does not want to cut the bus network either."
This apparent entrenchment does not play well with MPs outside London. Louise Ellman, the Labour MP for Liverpool Riverside, is also chair of the transport select committee and rejects TfL exceptionalism. "Economic growth is important throughout the regions and we must invest in them as well as in London. A policy of only investing in the centre can only be to the detriment of the nation."
If TfL's argument is largely ignored, Hendy's mastery of detail still makes him the best person to keep London moving, says Tony Travers, director of the Greater London group at the London School of Economics. "Peter Hendy is as experienced as anybody can be when it comes to handling transport in London. He is tenacious." Travers cautions that the job will become more difficult when the inevitable cuts are imposed: "There is no question that there will be cuts. Running transport in London is always a struggle to achieve the adequate, as opposed to ever delivering really good services."
Aside from a brief if well rewarded spell in the private sector in the mid-1990s – he made nearly £4m from the sale of CentreWest buses in a management buyout – Hendy is rooted in the public sector. He joined London Transport in 1975 as a graduate trainee and worked his way through the ranks, including a spell as a bus conductor.
Flak
His father was a communist electrician while his mother, Mary, the youngest daughter of Baron Wynford, was an active Labour Party member. His brother John Hendy, QC, often represents trade unions including the RMT, which has a strong presence at TfL.Nonetheless Hendy acknowledges that cuts are likely, reflecting the pragmatic nature of someone who worked with Labour mayor Ken Livingstone for seven years and two years so far with Johnson. Asked if, despite the lobbying, there will have to be reductions in the £39bn settlement, he says: "My personal belief is, yes. It seems it would be inconceivable [that we would avoid cuts]. We are a quarter to one-third of DfT spend, so if it is like the press says, we will undoubtedly suffer a reduction in spend."
At least Hendy will not have to take the flak for the fare rises that, under the brutally simplistic mathematics of transport funding, appear inevitable. If government funding is cut there are only a few scenarios to consider; slash jobs from TfL's 27,000 strong workforce and risk waves of RMT strikes; cut capital expenditure and let the Northern line reach bursting point, while maintenance costs and delays soar owing to ailing infrastructure; stick up ticket prices. Or a toxic mixture of all three.
Hendy says TfL and the mayor are not being selfish in wanting to keep Crossrail and the upgrades, while avoiding annual 10% fare increases on the No 55 to Hackney. "I didn't say it was untouchable. I said it was what Boris wanted to preserve, which is quite different. But it will be difficult." Things could be getting grim down south.
On the right lines
Age 57Education BA in economics and geography, University of Leeds
Career
1975 Joins London Transport as graduate trainee
1978 Personal assistant to LT chairman
1980-89 Senior posts in personnel and operations departments
1989 Managing director CentreWest London buses
1994 Leads CentreWest buyout
1997 Sells CentreWest to FirstGroup. Joins FirstGroup as head of London and southeast operations; then deputy director UK Bus
2001 Managing director of Ssurface transport, TfL
2006 Commissioner, TfL
Family Married, two children
You have characters left
Please read our community standards.
Closing this window without pressing "Post your comment" will result in your words being lost.
Are you sure?
Thank you for your comment. This has been submitted for moderation.
Your comment has been successfully posted.
Sorry, something has gone wrong and this action cannot be completed. Please try again later.