This is the single largest source of our income (40%), making a contribution to the costs of operating and improving our transport services. The decisions on fares are taken each year by the Mayor.
Fares increases have been maintained at the Retail Price Index rate in 2014 and 2015 - a real terms fares freeze. Our Business Plan assumes that fares will increase at the rate of Retail Price Index plus 1% each year from 2016 to 2021.
In addition to fares income, we generate income from the Congestion Charge and road network compliance charges. We also generate income from advertising, property rental and property sales and development, the latter including the Earl's Court joint venture and 55 Broadway.
We take advantage of commercial development opportunities and have recently introduced 'click and collect' at stations as well as third-party sponsorship for the Cycle Hire and the Emirates Air Line. Other income makes up 9% of our funding.
This makes up 23% of our funding and is received from central and local government, with the main sources being:
The new Crossrail project is the responsibility of Crossrail Ltd, a wholly-owned subsidiary of ours. Funding for it makes up 8% of our income. The project is jointly sponsored by us and the DfT.
We provide Crossrail funding as well as the DfT, GLA, through the Community Infrastructure Levy and developers' contributions, and from surplus land and property development income, which is expected towards to the end of the project.
In 2010, more than £1bn of project savings were identified through station and engineering improvements, which reduced both ours and the DfT's funding of the project.
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 20% of our income.
Our borrowing is based on considerations including the cost of borrowing, market conditions and the level of flexibility offered. Our borrowing limits are set out in our funding agreement with central government and are approved by the TfL Board.
Our new business plan will be part funded from cash balances. All of our cash balances, beyond a prudent minimum, are allocated to the investment outlined in the Plan. Our cash balances will only be used to fund capital investment and will never be used for any other purpose.