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No fare deal for London or Venezuela

Not many Londoners can be happy as they grope through the frozen murkiness of the commute to their first days back at work after the winter break. Adding to their misery is London's mayor, Boris Johnson, who has made their journey much more expensive with huge fare rises.
Alex Holland
12 January 2010

Not many Londoners can be happy as they grope through the frozen murkiness of the commute to their first days back at work after the winter break. Adding to their misery is London's mayor, Boris Johnson, who has made their journey much more expensive with huge fare rises.

Critics of Johnson's transport policies have highlighted how these massive increases - 20 percent for single bus fares alone - would not have been so high if Johnson hadn't trashed other sources of funding for London's transport.

Scrapping policies such as the extension of the congestion charge into West London or the £25 charge for gas guzzling cars have rightly been identified as stopping millions of pounds coming into the Transport for London (TfL) budget. 

The impact of Johnson's cancellation of London’s Venezuelan oil deal has not received as much attention, however. Though not as lucrative as the estimated £70 million congestion charge extension, the Venezuelan oil deal would have meant an extra £18 million for cash strapped TfL. Perhaps even more importantly, it was a genuinely great deal for Venezuelans.

The deal was brokered by former London mayor Ken Livingstone and Venezuelan president Hugo Chavez as an exchange of London's urban expertise – city-planning, transport and environmental protection – in return for cut-price fuel for London's buses. This oil subsidy meant that Londoners on income support could travel half price, and was warmly welcomed by a wide range of poverty activists.

Both during his election campaign and after becoming mayor, Johnson said hewanted to cancel the deal because it was "morally bankrupt" for a rich city like London to take oil money from a “very poor country" like Venezuela. He cancelled the Venezuelan deal but kept cut-price travel for those on income support, landing TFL with the bill, which ran into millions of pounds in unfunded costs

Johnson tried to imply Venezuela was not getting a good return from the deal. This was completely untrue. Venezuela is a country that has suffered from decades of lopsided development fuelled by the country’s main export, oil. Its capital Caracas is a combination of skyscrapers and ramshackle housing, with chaotic and often gridlocked traffic.

The almost total lack of urban planning is painfully evident and makes a huge difference to all Caracas residents. Despite having a superb underground system, this and the city’s public buses are severely limited, placing a heavy emphasis on the car. 

Venezuela does not lack oil or oil money. It is the fifth largest producer in the world. What it does lack is reliable and good value access to exactly the type of skills and experience that the London-Venezuela deal offered. 

Johnson might have had an excuse for his comments if the Venezuelan government wasn't spending money on its own country’s poor. But the opposite is true, with unprecedented amounts of oil money being used to establish successful health, education and employment programmes that have made real progress in reducing inequality.

Livingstone got it right when he said that this made Johnson's termination of the deal a "piece of mindless vandalism". Now that Johnson has bumped up fares by this extreme level, while throwing away an estimated £18 million for London and simultaneously harming the people of Venezuela, it seems even more mindless.

If Johnson's handling of London's transport budget is a taste of what people can expect from a Conservative government, then the prospect of that party taking charge nationally is far more chilling and murky than any overpriced January commute.

Cross-posted from the Samosa.

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