We're funded from sources such as:

  • Fares income - this is the largest single source of our income
  • Income from property and other assets
  • Other income, including from the Congestion Charge
  • Grants (including Crossrail funding)
  • Borrowing and cash reserves

Our operating grant from the Department for Transport finished at the end of the 2017/18 fiscal year.

TfL sources of funding 2018/19

infographic of funding sources Breakdown of how we are funded

Fares income (£4.8bn)

Fares are the single largest source of our income (projected to be 47% in 2018/19), and help to cover the costs of operating and improving our transport services. The decisions on fares are taken each year by the Mayor.

TfL fares are frozen for the length of the Mayor's term so Londoners will pay no more in 2020 than today. All TfL fare concessions are staying in place.

Property and other income (£1.5bn combined)

In addition to fares income, we generate income from the Congestion Charge and road network compliance charges. We also generate income from advertising, property rentals and property sales.

We take advantage of commercial development opportunities such as 'click and collect' at stations as well as third-party sponsorship for the Cycle Hire and the Emirates Air Line. Other income makes up around 14-15% of our funding in 2018/19.

Grants (£3.2bn)

Grants (including Crossrail funding) make up 31% of our funding in 2018/19 and are received from central and local government. The main sources are:

  • Business Rates Retention, which is funded from a proportion of local business rates and paid to us from the GLA. Introduced in 2013/14, this replaces money previously paid to us by the DfT as investment grant
  • Other funding includes capital grants, principally for the Northern line extension. This is provided by the GLA and financed from incremental business rates generated and retained within a new enterprise zone, and developers' contributions, raised by Wandsworth and Lambeth boroughs. Other funding also includes the GLA precept - this is funded from local Council Tax receipts and is set annually by the Mayor

Crossrail funding goes towards the project to build the infrastructure for the Elizabeth line. It is the responsibility of Crossrail Ltd, a wholly-owned subsidiary of ours. The project is jointly sponsored by us and the DfT.

Borrowing & cash reserves (£0.7bn)

We borrow from a variety of sources using a combination of mechanisms, including bonds, commercial paper, loans for specific projects from the European Investment Bank and the Public Works Loan Board. It makes up 7% of our 2018/19 funding pool.

We borrow in line with the provisions of the Prudential Code for Capital Finance in Local Authorities issued by the Chartered Institute of Public Finance & Accountancy. We must stay within the authorised limit for external debt at all times. The amount that we can afford to borrow is linked to both recurring annual income and cash available to pay financing costs.

Incremental borrowing is in line with the amounts agreed with Government as set out in the March 2017 Funding Agreement Letter and will be used to fund capital investment projects, including the acquisition of new rolling stock, station and line upgrades and new cycling infrastructure.

Reinvesting in transport

We are committed to reducing costs and reinvesting all our income to run and improve services.

We are a public body, with no shareholders or parent companies, which means we can reinvest every pound of income in the transport network

For every pound we receive, around 73% is spent on the everyday running costs of the network and around 27% on improving it for the future.