London ends cheap oil deal with Chávez

London ends cheap oil deal with Chávez

By George Parker in London

Published: May 25 2008 17:39 | Last updated: May 25 2008 17:39

Boris Johnson, London’s new rightwing mayor, is to axe the scheme under which Venezuela provided discounted oil to run the capital’s red bus fleet, a deal that funded half-price bus travel for some of the city’s poorest residents.

Mr Johnson, a member of the opposition Conservative party, denounced the deal struck by his predecessor with Hugo Chávez, Venezuela’s president, as “completely Caracas [crackers]”. He said it was an unfair subsidy to London by a country in which many people live in “extreme poverty”.

The agreement was made last year by Ken Livingstone, the Labour former mayor ousted in elections on May 1, who had always professed his admiration for the leftwing Venezuelan leader.

On Sunday, Mr Livingstone attacked Mr Johnson for the “cowardly” decision to announce the end of the half-price bus and tram deal for poor Londoners on a public holiday weekend. “It shows he is more interested in pursuing his rightwing ideological agenda than improving the living standards of the most deprived people in the capital.”

Mr Livingstone’s agreement has so far yielded £16m ($32m, €20m) for London’s transport authority, which was used to offer half-priced travel for 250,000 people on income support.

In exchange Mr Chávez – dubbed a “third-rate South American dictator” by his Conservative critics – was given advice by London on urban planning in Caracas, the country’s capital.

Mr Johnson on Sunday announced that work had begun to close down a £67,000-a-year operation in Caracas to oversee the deal.

“I think many Londoners felt uncomfortable about the bus operation of one of the world’s financial powerhouses being funded by the people of a country where many people live in extreme poverty,” he said.

“I simply think there are better ways of benefiting Londoners and better ways of benefiting Venezuelans.”

Mr Johnson said the agreement with Venezuela would not be renewed when it expired in August. A spokesman said there was no plan to extend the fares policy.

Mr Livingstone said: “The suggestion that Johnson is motivated by any concern about the people of Venezuela is just a lie, shown by the fact that he is withdrawing all technical support and advice provided by London under this agreement.”

Mr Livingstone was the most prominent political casualty in the tide of anti-Labour sentiment sweeping the country in local elections earlier this month.