The UK’s Tyne & Wear Metro could face a GBP8.8m (EUR10.2m) budget shortfall in 2022-23, Passenger Transport Executive Nexus has warned.
A report prepared for the North East Joint Transport Committee on 23 October included a forecast that financial savings of GBP3m could be delivered in 2021-22 and 2022-23 – at which point remaining reserves would be GBP3.4m (EUR3.9m). However, Nexus warned that the “impact on services would need to be considered if, after use of reserves, and assuming there is no increase in the grant (levy), there was still a deficit to eradicate.”
Nexus Director of Finance and Resources John Fenwick told TAUT: “We face a challenging financial position across the medium term due to reductions in Metro fare revenue, cuts to local authority budgets and increased cost pressures as we look to introduce our new fleet of trains and maintain frontline services.
“Our prudent approach means that we have sufficient reserves to protect services in what remains of this year and next year, but there is probably a question of how sustainable that is thereafter.
“Nexus is awaiting the outcome of the local government funding settlement for councils. The position going forward will be clearer when that is known.”
The first section of the Tyne & Wear Metro opened in 1980 and the system now covers 77.5km (48 miles). A procurement process is currently underway to replace the system’s first-generation rolling stock (see also Worldwide Review on page 489).