In message , at 12:38:11 on
Mon, 8 Jan 2018, Recliner remarked:
This is a form of off-balance sheet government borrowing.

I am long past the need to know but thought that accounting standards
had now stopped such sale and leaseback deals escaping the balance
sheet. I can't see TfL arguing successfully it's an operating lease.
And I think IFRS16 removes even that distinction from next year for
plant and machinery so TfL would have to show a “right to use the stock”
asset and a "lease" liability on their balance sheet.

It would be much
cheaper if the Treasury borrowed the money directly.
Cheaper for TfL, yes. Whether it's cheaper for the country depends on
what the bond markets decide about UK national debt.

And people outside London paying increased fares year by year might ask
why Londoners who don't should be bailed out.

Yes, that does the raise the question of why TfL is still freezing
Tube fares when it doesn't have enough budget to renew life-expired
fleets.

Because the Mayor made it an election commitment.

If he goes back on that, he may well not get re-elected, which party
politics aside, will very likely cause turbulence costing more than this
one-off deal's low interest rates on money to prop up day to day
operations; which they can't raise as a free-standing loan because
that's not how public financing works.
--
Roland Perry