A 24-hour Tube service is a great idea - but more can be done to improve London's infrastructure

Improvements to Tube are badly needed. Official projections show London’s population is growing by 2,000 every eight days. Getting more out of our existing infrastructure is essential to keeping London competitive and keeping its economy thriving.

In an open letter to passengers, the mayor and Transport for London have committed themselves to a 24-hour Tube service. It’s an exciting announcement, and will undoubtedly deliver a boost to London’s £8bn a year dining and entertainment industry. But there are wider implications for the capital.

For decades, the Underground has run New Year’s Eve “all-nighters”, but the plan almost certainly means that regular all-night running will happen for the first time ever. Initially limited to five lines, and beginning in 2015, Friday and Saturday operations could grow to cover more of the network and eventually Thursday nights.

The changes would do more than make life easier for revellers, however. They would mark a dramatic achievement for City Hall and Tube bosses. For decades, central government and then the first mayor wrestled with unions, engineers and complex public-private partnership contracts to get all-night running on the network. A host of reasons were lined up to say why this was not possible or unaffordable. Then came the Olympics.

London’s transport system worked efficiently to deliver record volumes of passengers, and the Tube ran longer and started earlier. Londoners seized on these achievements. What if the energy of the Olympics could be harnessed for delivering public services for London on a regular basis?

Improvements to Tube service are certainly pressing. Official projections show London’s population is growing by 2,000 every eight days. Over the next ten years or so, the city’s headcount will grow by a number equivalent to the population of Birmingham. Getting more out of our existing infrastructure is essential to keeping London competitive and keeping its economy thriving. It will help us compete in a global race with cities like Berlin, Paris and New York.

But to keep up with demand, city leaders should go further. Mayoral control over suburban rail, quiet out-of-hours deliveries, improved shopping streets, diesel-free taxis and further improvements for cyclists are a few ideas that come to mind. Running bus and Tube services on Christmas Day is another. No other multicultural world city shuts its transport system down the way London does.

Delivering these initiatives will require investment and control by local politicians. Permitting the mayor and London’s councils to keep a greater proportion of the capital’s taxes would allow more projects to be funded and services to be improved. Londoners would be able to enjoy the benefits that growth brings, and authorities would have the resources to deal with more of the pressures.

Alongside congestion charges, the cycle hire scheme and delivering the Olympics, a 24-hour Tube is a testament to London devolution. Ministers should now go further and be bold with city finance reform. As the London Finance Commission recommended, Whitehall should let Londoners and their leaders have more financial freedom to improve the capital's fabric. We may then see more of the improvements vital for a thriving city, that increasingly doesn’t want to sleep.

London's population is growing by 2,000 people every 8 days. Photograph: Getty Images.

Alexander Jan is a consultant at Arup.

Photo: Getty
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George Osborne's mistakes are coming back to haunt him

George Osborne's next budget may be a zombie one, warns Chris Leslie.

Spending Reviews are supposed to set a strategic, stable course for at least a three year period. But just three months since the Chancellor claimed he no longer needed to cut as far or as fast this Parliament, his over-optimistic reliance on bullish forecasts looks misplaced.

There is a real risk that the Budget on March 16 will be a ‘zombie’ Budget, with the spectre of cuts everyone thought had been avoided rearing their ugly head again, unwelcome for both the public and for the Chancellor’s own ambitions.

In November George Osborne relied heavily on a surprise £27billion windfall from statistical reclassifications and forecasting optimism to bury expected police cuts and politically disastrous cuts to tax credits. We were assured these issues had been laid to rest.

But the Chancellor’s swagger may have been premature. Those higher income tax receipts he was banking on? It turns out wage growth may not be so buoyant, according to last week’s Bank of England Inflation Report. The Institute for Fiscal Studies suggest the outlook for earnings growth will be revised down taking £5billion from revenues.

Improved capital gains tax receipts? Falling equity markets and sluggish housing sales may depress CGT and stamp duties. And the oil price shock could hit revenues from North Sea production.

Back in November, the OBR revised up revenues by an astonishing £50billion+ over this Parliament. This now looks a little over-optimistic.

But never let it be said that George Osborne misses an opportunity to scramble out of political danger. He immediately cashed in those higher projected receipts, but in doing so he’s landed himself with very little wriggle room for the forthcoming Budget.

Borrowing is just not falling as fast as forecast. The £78billion deficit should have been cut by £20billion by now but it’s down by just £11billion. So what? Well this is a Chancellor who has given a cast iron guarantee to deliver a surplus by 2019-20. So he cannot afford to turn a blind eye.

All this points towards a Chancellor forced to revisit cuts he thought he wouldn’t need to make. A zombie Budget where unpopular reductions to public services are still very much alive, even though they were supposed to be history. More aggressive cuts, stealthy tax rises, pension changes designed to benefit the Treasury more than the public – all of these are on the cards. 

Is this the Chancellor’s misfortune or was he chancing his luck? As the IFS pointed out at the time, there was only really a 50/50 chance these revenue windfalls were built on solid ground. With growth and productivity still lagging, gloomier market expectations, exports sluggish and both construction and manufacturing barely contributing to additional expansion, it looks as though the Chancellor was just too optimistic, or perhaps too desperate for a short-term political solution. It wouldn’t be the first time that George Osborne has prioritised his own political interests.

There’s no short cut here. Productivity-enhancing public services and infrastructure could and should have been front and centre in that Spending Review. Rebalancing the economy should also have been a feature of new policy in that Autumn Statement, but instead the Chancellor banked on forecast revisions and growth too reliant on the service sector alone. Infrastructure decisions are delayed for short-term politicking. Uncertainty about our EU membership holds back business investment. And while we ought to have a consensus about eradicating the deficit, the excessive rigidity of the Chancellor’s fiscal charter bears down on much-needed capital investment.

So for those who thought that extreme cuts to services, a harsh approach to in-work benefits or punitive tax rises might be a thing of the past, beware the Chancellor whose hubris may force him to revive them after all. 

Chris Leslie is chair of Labour's backbench Treasury committee.