London Mayor Sadiq Khan has unveiled plans to reduce Transport for London's (TfL) costs to £800 million per year by 2020/21.

Announcing a new draft Business Plan today, 08 December, Mayor Khan said efficiency savings will be made at the "flabby" organisation while also protecting front line services and transport investment.

To deliver the savings, the TfL is being redesigned throughout its organisation, from IT projects, to procurement, to project planning and delivery.

Savings incorporated in the plan include:

• £2 billion from establishing a new operating model for their business by reducing management layers, merging functions such as engineering to eliminate duplication.

• £2bn through renegotiating and bringing together the management of contracts, getting more affordable deals from suppliers, and renewing and enhancing assets in more cost effective ways.

• Raising £3.4bn for reinvestment in the transport network by 2023 through property development, advertising and consultancy opportunities. Ideas include putting spare land to better use by building 10,000 homes.

In addition, the Plan sets out a range of further modernisation improvements to be made over the next five years. Highlights include:

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• Developing the new Elizabeth line to improve travel across London, installing new signalling on the Metropolitan, Hammersmith and City, District and Circle lines, and further upgrading the Jubilee and Northern Lines. The construction of brand new trains for the Piccadilly, Central and Bakerloo lines will begin and station upgrades will be completed at Victoria, Bond Street and Finsbury Park and elsewhere.

• Work on an extension of the Bakerloo line to Lewisham, via Old Kent Road and New Cross Gate, will progress with the completion date brought forward by two years from 2031 to 2028/29 to fit in with the timetable for the upgrade of the Bakerloo line. The scheme will support up to 25,000 new homes and 5,000 new jobs.

• Work to modernise Camden and Holborn stations will get underway, the Northern line will be extended to Battersea, and the London Overground extended to Barking Riverside. The capacity of the Docklands Light Railway will be increased by a third.

Other plans include progressing new east London river crossings, such as the Silvertown Tunnel, building a new pedestrian and cycling bridge linking Rotherhithe and Canary Wharf, and an extension of the DLR from Gallions Reach to Thamesmead.

Major investment will be made to transform areas such as Old Street and Vauxhall, where safer crossings, new cycling infrastructure and better public spaces are being created. Improvements will also be carried out at Stratford town centre and Oxford Street, where the Mayor and TfL continue to work with Westminster City Council and others on plans to transform the Street for pedestrians.

Mayor Khan said: "The new TfL Business Plan being presented today sets out an ambitious and wide-reaching programme that allows us to both freeze TfL fares, and invest record amounts modernising London's transport's infrastructure.

"The previous Mayor refused to do it, but in reorganising a flabby TfL and finding major efficiency savings within the organisation, we're securing this record investment without burdening Londoners with further hikes in TfL fares.

"Our plans over the next five years include modernising major Underground stations, bringing forward plans to extend the Bakerloo Line, and investing record amounts in cycling and cleaning up London's air."

(LM/JP)