Council Tax - Transport Funding

Investing in Greater Manchester transport 2019/20

Transport is an important part of life for everyone in Greater Manchester. It connects people with jobs, education, family and friends; it gets customers and suppliers to businesses and connects people with important public services.

The following information gives an overview of how revenue funding will be spent on transport over the next 12 months.

 

Who will manage transport and the revenue funding?

Transport for Greater Manchester (TfGM) delivers the transport policies agreed by Greater Manchester Combined Authority (GMCA). Our vision for 2040 is to have a city-region with world-class connections that support long-term, sustainable economic growth and access to opportunity for all.

To achieve this we want 50% of all journeys in Greater Manchester to be made on foot, by bike or using public transport by 2040. This will mean a million more sustainable journeys every day, enabling us to deliver a healthier, greener and more productive city-region without increasing motor vehicle traffic.

We also work closely with a range of partners to address long-term strategic transport issues including congestion, air pollution and bus reform.

TfGM coordinates transport networks across the region, and we own Metrolink, the UK’s largest light rail network – which currently accommodates more than 42 million passenger journeys each year. The network is operated on TfGM’s behalf by KeolisAmey Metrolink (KAM).

We are responsible for the further expansion of the Metrolink network and both build and manage bus stations and transport interchanges across Greater Manchester. TfGM also coordinates the delivery of cycling and walking infrastructure across Greater Manchester.

Along with local authorities and Highways England, TfGM oversees the highways network to make travelling as safe and efficient as possible for all road users, including pedestrians, cyclists, buses, car users and freight.  

TfGM does not operate rail services in the region and the majority of bus services are operated by commercial operators. We do however coordinate closely with rail and bus operators and provide travel planning and timetable information for passengers, as well as promoting walking and cycling as safe and healthy commuting options.

TfGM is committed to making travel easier by delivering, coordinating and maintaining an integrated transport network for the people and businesses of Greater Manchester, working alongside the bus, tram and train operators who run the services.

 

Funding

GMCA/TfGM receives the following revenue funding to provide for its expenditure: 

 

2018/19 Budget

2019/20 Budget

Variance

 

£m

Total

£million

Resources

 

 

 

Total Levy

279.20

195.77

(83.43)*

Special Rail Grant

1.86

1.86

-

Metrolink Funding from Revenue / Reserves

9.88

10.30

0.42

Funding from/(to) reserves

(80.48)

11.46

91.94

Mayoral General Budget

3.95

3.95

-

Earnback Revenue Grant/Reserves

13.50

13.07

(0.43)

Other Grants

16.51

14.10

(2.41)

Total Revenue

244.42

250.51

6.09

 

 

 

 

 

 

 

 

 

*Total Levy in 2018/19 was gross of an adjustment of £87.98 million, in relation to the ‘re-instatement’ of the Transport Levy used on a ‘one off’ basis in 2017/18 to provide the necessary financial capacity to facilitate savings in the GM Waste contract.

Please note all figures are rounded.

 

Total Levy

GMCA/TfGM receives funding from several areas. The largest part comes from a levy on the ten Greater Manchester local authorities via council tax. In total, this accounts for £195.77million in 2019/20.  This comprises an ‘underlying’ Levy of £192.473 million, which is unchanged from the previous year; an amount of £8.3 million to fund additional transport costs associated with Bus Reform, including the 16-18 travel concession; and a reduction of £5 million in relation to £3.8 million which is returned to districts from general reserves and a one-off reduction in the Levy of £1.2 million.

 

Special rail grant

The Department for Transport (DfT) provides a rail grant to TfGM which contributes towards the costs that TfGM incurs on rail activities. This is budgeted to be £1.9 million in 2019/20.  There is a risk, on an ongoing basis, that this funding will be reduced.   Should this grant reduce this would have a potentially significant impact on the rail related activities being delivered by TfGM.   Discussions are ongoing with DfT regarding the continuation of this funding in 2019/20 and beyond.

 

Funding from reserves

Financial reserves will provide a further £21.76 million, including a contribution from Metrolink net revenues to financing costs of £10.30 million. 

Within the amount above GMCA has approved the use of £5.5 million of reserves to support scheme development/feasibility work on known GMCA priorities, including the development of potential public transport solutions that will support the city region’s growth agenda; the development of a second Transport Fund; and to support the development of the Greater Manchester Spatial Framework; the 2040 Delivery Plan; and £0.5 million to continue to develop the work around the Rail Stations Partnerships

  

Mayoral General Budget

As in 2018/19 the Mayoral Budget will support certain costs (£3.95 million) which have previously been funded from the Transport Levy but which are now a Mayoral function and need to be funded by a Mayoral Precept or Statutory Charge. This includes, in particular, the costs associated with developing, updating and delivering the Local Transport Plan.

 

Earnback Revenue Grant/Reserves

Earnback funding is budgeted to be used to fund Trafford Metrolink Capital Financing Costs (£7.182 million); Bus Reform, including the 16-18 travel concession (£5.75 million); the Women’s Concessionary Travel Pass (£0.1 million); and the costs of the Cycling and Walking Commissioner (£0.035 million). 

 

Other grants

GMCA and TfGM have been successful in securing capital and revenue funding from a number of sources. A total of £14.10 million of this revenue funding is budgeted to be spent in 2019/20. 

 

How will the money be spent in 2019/2020?

 

2018/19 Budget

2019/20 Budget

Variance

 

£m

Total

£million

 

 

 

 

Call on Resources

 

 

 

Concessionary Support

67.18

73.38

6.20

Supported Services

27.11

27.61

0.50

Accessible Transport

4.61

4.91

0.30

Operational costs (including funded from reserves and grants)

60.45

60.38

(0.07)

Financing

85.07

84.23

(0.84)

Total Expenditure

244.42

250.51

6.09

Please note all figures are rounded.

 

Concessionary support

TfGM funds the cost of concessionary fares including the English National Concessionary Travel Scheme and Local Concession schemes.

GMCA, TfGM and the bus operators have been in discussions regarding the potential implementation of a concessionary travel scheme for people aged 16-18. A report on the proposals will be presented to GMCA in March 2019.

It is proposed that the existing balance on the Concessionary Travel Reserve, which is forecast to be c. £8 million at 31 March 2019, is retained to fund the risks connected with the potential implementation of the 16-18 Concession. 

 

Supported services

Buses are vital to the region’s economy and society. More people travel in Greater Manchester by bus than by all other means of public transport put together, with around 194.3 million passenger journeys taking place by bus last year (October 2017 - September 2018).

Under the current system, the majority of Greater Manchester’s bus services are run by private companies. These operators are free to decide routes, timetables, and set fare levels.

TfGM financially supports around 20 per cent of Greater Manchester’s bus services, which run at times of day and in areas where there is a social need. In 2019/20 £27.1 million is budgeted to pay for these services.

 

Accessible transport

TfGM funds Ring and Ride – a door-to-door accessible transport service for people who find it difficult to use ordinary public transport.

TfGM also provides travel vouchers for those not able to use ordinary buses, trains or Metrolink and who have serious walking difficulties or are registered blind. They can be used to pay for taxis, private hire vehicles and for travel on accessible bus services such as Ring and Ride and community transport.

In 2019/20 the grant is budgeted to increase by £0.3 million to assist with the replacement of up to 31 fleet vehicles which will reach the end of their economic life over the next two years. 

 

Operational costs

For 2019/20 the amount of money spent on operations is budgeted to be £60.38 million – c. 24 per cent of total expenditure. This covers the costs of:

  • Bus station operations
  • Travelshops
  • Safety and security
  • Bus shelters
  • Traffic signals, maintenance and operation
  • Passenger information
  • Consultation, diversity and social inclusion
  • Support costs

Also Included within these costs is the expenditure that TfGM is incurring on scheme development and feasibility work on known GMCA priorities.