Fares are the single largest source of our income (47% in 2017/18), 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 terms so Londoners pay no more in 2020 than today. All TfL fare concessions are staying in place.
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 sale and leaseback of 55 Broadway and the sale of commercial sites at new Crossrail stations.
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 11% of our funding in 2017/18.
Grants make up 23% of our funding in 2017/18 (£2.35bn) and are received from central and local government. The main sources are:
Crossrail funding of £216m in 2017/18 funds the project to build the infrastructure for the Elizabeth line. It is the responsibility of Crossrail Ltd, a wholly-owned subsidiary of ours. Funding for it makes up 2% of our income. The project is jointly sponsored by us and the DfT.
We provide funding to the project 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.
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 17% of our 2017/18 income.
Borrowing is in line with the Chartered Institute of Public Finance Accountancy Prudential Code and 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.
The Government has offered us increased flexibility so we are now in a position to borrow as and when we require funding. This will mean a savings on debt financing costs.
Incremental borrowing is in line with the amount agreed with Government as part of the 2015 Spending Review, and will be used to fund capital investment projects, including new rolling stock, station and line upgrades and new cycling infrastructure.