Income from the Ulez expansion to the Greater London boundary will be spent on new buses and more cycle lanes, Sadiq Khan has revealed.
Transport for London predicts that the expansion of the mayor’s clean air zone across all 33 boroughs – due to happen on August 29 – will generate an average of £200m a year in the first two years, falling to £50m in later years as drivers switch to cleaner vehicles and compliance rates increase.
The Ulez is not expected to make a “net profit” after 2026/27.
Income from the congestion charge and the Ulez, which launched in central London in April 2019, has always been reinvested in public transport.
But Mr Khan said he wanted to “clarify” how the Ulez expansion income would be spent, suggesting there had been “some confusion”.
In a letter to Nick Rogers, transport spokesman for the City Hall Conservatives, Mr Khan and TfL commissioner Andy Lord said the cash would primarily be spent on three areas.
These are:
• £50 million for the new Superloop outer London bus network.
• £200 million for new electric buses which will operate across London, including outer London, with an additional 400 electric buses to be delivered by March 2024
• £8 million for 300 bus countdown signs at bus stops to encourage public transport use and keep passengers informed
• £150 million to support the Healthy Streets programme delivering walking and cycling improvements across London
The £12.50 daily levy will be paid by drivers whose vehicles fail to meet the mayor’s exhaust emission rules – generally speaking, petrol cars first registered before 2005 and diesel vehicles that are pre-2016.
Drivers can check their vehicle’s status by entering the numberplate on TfL’s website check page.
The letter said that the Ulez was “explicitly not designed as a revenue raiser” but to reduce vehicle emissions.
The amounts to be spent by TfL will be after it has covered the costs of setting up and running the Ulez – including operational costs and camera and signage infrastructure. Mr Khan is also spending a further £110m on a scrappage scheme.
Tory critics have claimed the benefits from the Ulez expansion are marginal – referring to an independent analysis for TfL by Jacobs consultants which said it was “likely to have a moderate positive impact on nitrous oxides road traffic emissions and a minor positive impact on particulate matter emissions”.
The Jacobs report assessed that there would be “a minor positive impact on health outcomes for Londoners”.
The Ulez has seen compliance rates increase rapidly, meaning that about 95 per cent of cars in the current zone are exempt from the levy.
However, compliance rates of cars registered in some outer London boroughs are little over 80 per cent, and only about 50 per cent for vans.
Mr Khan and Mr Lord wrote: “We regard it as a great success that the amounts generated by the central and inner London Ulez were lower than forecast, because compliance rates were reached more quickly than originally forecast.
“That is exactly the aim of the policy – to support people to move to greener and less polluting vehicles or to walk, cycle or use public transport so as few people as possible pay the charge.”
Professor Kevin Fenton, the association’s president, said the mayor “has shown his willingness to take on major challenges for London to improve the health, wellbeing and economic productivity of all Londoners”.
