Work to introduce driverless tube trains has been demanded by ministers as part of an emergency funding agreement for Transport for London, with the government injecting just over £1bn to help the capital recover from the pandemic. TfL will be obliged to produce business cases for driverless trains on the Piccadilly and Waterloo and City lines in return for the latest funding, which also comes with a requirement to make £300m of annual cuts and slash pensions. The mayor, Sadiq Khan, said the short-term settlement was a “sticking plaster” and that he had reluctantly agreed to the conditions. However, he promised to fight any further moves to introduce driverless trains, which he said would cost billions of pounds and be a “gross misuse of taxpayers’ money”. The settlement is designed to provide financial support until 11 December and will take total government support to TfL since March 2020 to more than £4bn. The transport secretary, Grant Shapps, said: “This £1.08bn financial package will support London and its transport network through the pandemic, and ensure it is a modern, efficient and viable network for the future. “Throughout this process the government has maintained that these support packages must be fair to taxpayers across the UK and on the condition that action is taken to put TfL on the path to long-term financial sustainability. As part of today’s settlement, the mayor has agreed to further measures that will help ensure that.” The bitter standoff between the Labour mayor and the Conservative government does not appear to have abated, with ministers still affirming that TfL mismanagement, rather than the multibillion-pound revenue loss when passengers were told to avoid public transport during the pandemic, is responsible for its parlous financial situation. On top of the pensions review and £300m of annual savings, TfL must find increased revenue of £500m-£1bn each year from 2023 – potentially spelling large fare rises – and carry out a joint review with government of service levels on its transport network. Unions threatened strikes over the attacks on pensions, as well as the moves towards taking drivers from tube lines. The driver would be replaced by an onboard attendant under government proposals, following the model of operation of the Docklands Light Railway, part of the TfL network in east London. The RMT general secretary, Mick Lynch, said it was “a disgraceful stitch-up of a deal and it will be resisted by our members whether it comes from Whitehall or City Hall through London-wide industrial action if necessary”. He said driverless trains were “unwanted, unaffordable and unsafe”. Khan said he had “seen off the worst of the conditions the government wanted to impose on London, which would not only have required huge cuts to transport services equivalent to cancelling one in five bus routes or closing a tube line, but would have hampered London’s economic recovery as well as the national recovery”. He added: “I want to be honest with Londoners: this is not the deal we wanted.” He said he was hopeful that returning passenger revenue, the bulk of which comes from the underground, would grow enough to avoid introducing “unfair measures”. Tube use fell to 4% of normal levels during the first lockdown and is now about 40% of pre-Covid numbers. TfL’s boss, the transport commissioner Andy Byford, said the pandemic showed that London’s financial model, with a huge reliance on fare revenue, was “not fit for purpose”. He said the agreement would allow TfL to continue to run near-full levels of service and deliver improvements such as the Elizabeth line and Northern line extension, but added: “It is vital that we also use this period to agree a longer-term settlement so that we can plan effectively for London’s future and deliver maximum value for money through our contracts and supply chain.” TfL will also have to stump up funds for the repair of Hammersmith Bridge, led by the borough, with the government contributing up to one-third of the costs of fixing the Thames crossing. The bridge has been closed for just over nine months – and for two years to traffic – after cracks were found in the structure.