Tube and bus fares in London will rise above inflation every year for the next eight years despite the cancellation of £3.7 billion of transport improvements, according to the transport business plan published by the Mayor of London yesterday.

Boris Johnson has scrapped ten large projects to expand the capacity of the city’s transport network. The cuts will have the greatest impact on East London, especially the Thames Gateway redevelopment area, where 100,000 homes are due to be built but will now have little extra transport provision.

Transport for London had already spent more than £60 million designing and planning the schemes that were abandoned yesterday.

The mayor’s plan stated that TfL’s budget up to 2018 “assumes that all TfL fares will rise annually at a rate of the retail price index plus one per cent each January over the period 2009-10 to 2017-18”.

One of the cancelled projects, the £500 million Thames Gateway Bridge, had been in preparation for two decades. The bridge was designed to relieve congestion on the other river crossings in East London and had already been granted £350 million of government-backed funding.

Mr Johnson decided not to approve the £90 million needed from TfL for the bridge to proceed. He admitted that another Thames crossing was urgently needed but said that planners would now start looking at a different location, possibly at Silvertown.

The mayor dropped plans to bring back trams to Central London after an absence of half a century. The Cross River Tram would have run between Euston and Waterloo, with several onward branches, and cost £1.3 billion.

The £750 million extension of the Docklands Light Railway to Dagenham Dock and the £170 million Crystal Palace link in Croydon’s tram network have also been cancelled.

Plans for two new express bus services serving new estates in East London have been suspended pending a review, and a scheme to replace Oxford Street’s diesel buses with an electric tram has been abandoned.

Mr Johnson signalled that he would not take forward the plans of his predecessor, Ken Livingstone, to create more pedestrian space on London’s major squares. “Public space proposals such as Parliament Square, Euston Circus, and Victoria Embankment have been cancelled as they offered limited transport benefits and had the added disbenefit of restricting traffic flow,” the plan said.

Mr Johnson said: “The tragic reality is I am undoing a cruel deception on the people of London. There simply isn’t the funding to deliver what was promised. These things can come back if there is the funding to do them.”

The plan states that by 2025 London’s population is expected to have grown by up to 1.1 million and the transport system will have to cope with four million extra journeys a day.

Val Shawcross, Labour’s London Assembly transport spokeswoman, said: “The mayor’s utter lack of commitment to public transport, to encouraging people out of their cars and to investing in London’s future have been vividly exposed today. It seems that poorer areas of London and the outer boroughs in most need of public transport links do not feature in the mayor’s vision.”

Friends of the Earth said it was delighted that the Thames Gateway Bridge scheme had been cancelled.

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