Commentary: It's a once-in-a-lifetime choice

London has a once-in-a-lifetime opportunity to launch a five-year, £10billion investment programme, which will transform the city's transport system. This will require a short-term increase in fares to help meet the costs of servicing the borrowing necessary to fund this investment.

Alternatively, we can decide there will be no investment programme, in which case a rise in fares will not be necessary - but the transport system will deteriorate rapidly.

That is the real choice I have had to make, not - as the Evening Standard suggests - to resolve a transport budget deficit. Transport for London is bound by law to run a balanced budget: it never has, and never will, run a budget deficit.

Transport for London's 2003 business plan made the case for an extra ?1 billion a year to improve and expand London's transport system after decades of neglect.

In the recent spending review, the Government authorised nearly three quarters of the increase in spending that we had proposed, with an increase in London's grant of almost £800 million in the next five years - and agreement for us to borrow £2.9 billion over the same period to finance a major investment programme.

This means that we will be able to do most, but not all, of the things we have proposed to improve and expand the transport system. I will announce the programme of projects in the weeks to come.

At the same time, the cost of servicing borrowing for investment will have to be met from current income and will rise to £250million a year after five years. That is why we need to increase fares by 10 per cent above inflation on the buses and one per cent for the Tube. The goal is to seize this unique opportunity to bring the sort of improvements seen on the bus network to the London Underground - and a series of new projects, ranging from the construction of the East London Line Extension to better information at bus stops. This will be the biggest transport investment programme London has seen since the Second World War.

Even after the fares increase next January, the average fare for each bus trip will, in real terms, still be less than it was when I was first elected more than four years ago. Free bus travel will be extended from under-11s to under-16s in September next year and Oyster cards will continue to provide lower fares than cash.

So, for virtually the same fare in real terms, people are getting a far better service, while buses are faster, more reliable and cleaner.

That is why, in the six months following the fare increases last January, the [number of] bus trips rose 7.9 per cent compared to the previous year and Tube trips rose 3.5 per cent.

We have a once-in-a-lifetime chance to transform our transport system.

I have no intention of shying away from the hard short-term choices necessary to seize that opportunity for London.