Government in talks over Metro bailout after 90% drop in passenger numbers leaves system in jeopardy
Government officials are in talks over an urgent bailout of the Tyne and Wear Metro – but have yet to commit to rescuing the network from a cash crisis caused by coronavirus.
North East leaders issued another desperate call on Thursday for ministers to promise financial support for the Metro system, which is losing millions in vital ticket revenue as passengers stay at home during the pandemic.
Operator Nexus is asking the Department for Transport (DfT) to hand over £10million to keep the Metro going until July, with even more money needed if the Covid-19 crisis continues beyond then.
Family tell of heartbreak after baby girl dies following failings at South Tyneside's birthing centre
Coroner questions safety of midwife-led birthing centres after death of baby girl following failings at South Tyneside District Hospital
Healthcare safety investigators make recommendations after death of baby girl
After warnings of services being slashed and jobs being cut if a bailout is not quickly secured, the DfT responded: “We recognise that this is a challenging time for the Tyne & Wear Metro and are working closely with Nexus to identify solutions.
“The department is in discussions with metro and light rail operators on how best to support the operation of services so that essential journeys can continue to be made by critical workers.”
Talks over a bailout of the Metro are understood to have begun on March 16, since when the government has announced rescue packages for bus companies and private rail firms.
Metro passenger numbers have dropped more than 90% and more than 600,000 journeys were lost in March.
It is understood that the network’s cash shortfall now amounts to around £1million per week and that evening and off-peak train services could be reduced if government support is not forthcoming.
Martin Gannon, leader of Gateshead Council and chair of the North East Joint Transport Committee, said on Thursday: “Metro plays a huge role in the local economy but we urgently need the Government to confirm in writing that it will provide financial support in the same way that it has been prepared to do for bus and national rail operators.
“Failure to do so could lead to long-term service reductions and job losses, at a time when North East England has never needed Metro more.”
The Metro costs around £104million a year to run and income from ticket sales is responsible for £48million of that.
Meanwhile, a number of North East MPs – including Wearside trio Bridget Phillipson, Sharon Hodgson and Julie Elliott along with South Tyneside politicians Emma Lewell-Buck and Kate Osborne – have written to Transport Secretary Grant Shapps urging the Givernment to take action to support the Metro system.
They said: “The restrictions in place to stop the spread of Coronavirus and protect the NHS have had a huge impact on the Metro, as they have had on other forms of public transport. Ridership on the Metro is down by 90-95% and this has resulted in a sharp drop in fare income which would usually cover two thirds of the service’s operating costs.
“The Metro continues to provide a vital service for essential workers, and this must continue to ensure those working on the frontline in the fight against Coronavirus can get to their place of employment safely and on time. The drop in commercial income from fares means an additional £10 million is needed up to July 2020 to keep services running. Further support may be required after that depending on the speed of recovery in fare income, when restrictions are eventually lifted.
“We welcome your Department’s intervention to provide financial support to bus operators in the North East following a comparable fall in passenger numbers and fare income on our region’s buses. These services are also supported by the continuation of funding from local authorities in their respective operating areas. The decision to temporarily suspend franchising arrangements on the national rail network to ensure vital services can continue to run was also welcome.
“Metro services are now the remaining piece of the puzzle and we ask that you provide the same level of support to keep them running.
“The Tyne and Wear Metro plays a central role in our regional economy. It has expanded twice previously, to Newcastle Airport and to Sunderland, and investigations for future expansion across the North East were due to begin this year. A well-functioning Metro system will be vital to ensure we can recover when the present situation has abated, and restrictions are lifted.
“A failure to act now could lead to long term service reductions and job losses which would be devastating for our region’s transport system and the people, businesses, and communities who rely on it.”