London escapes the worst with Crossrail and Tube guarantees

London emerged as one of the winners of today's spending review but Boris Johnson warned it would still have to bear its share of the pain.

The Mayor said he had successfully protected the bus subsidy — meaning concessionary fares will not be cut.

In other transport announcements, the popular "Boris Bike" hire scheme will be extended eastwards in time for the Olympics and the congestion charge will go up from to £8 to £10 in the new year. The bike scheme may also be extended south and north, although this has not been confirmed. Extensions at Tate Modern and the British Museum will also go ahead.

The Tate project will cost about £200 million, of which the Government will contribute a third. The British Museum's £135 million extension for "blockbuster" exhibitions stays on track after the Department of Culture confirmed its contribution of £20 million was still in place.

Mr Johnson said: "I am pleased the Government has recognised the immense importance of protecting investment in the capital. London is the engine of the UK's economy and it would be fiscal suicide to have starved it of fuel.

"The Government has recognised my administration in London has been two years ahead of the rest of the country in identifying and making savings, with well over £5 billion identified at Transport for London alone.

"We will continue to share the pain of the nation as we work with the Government to help put Britain's finances back in order."

A Treasury source said: "The Chancellor fully believes that jobs and growth and capital spending in London are vitally important."

One of the biggest successes was the delivery of Crossrail, "lock, stock and barrel", with only a slightly delayed timetable. The cross-London line, running from Heathrow and Maidenhead to Abbey Wood and Shenfield in the east, was originally to be built for £16 billion and scheduled to open in 2017.

But building firms have been asked to go back to the drawing board to cut costs and the final bill is now expected to be £14.5 billion — £1.5 billion less. The line's opening is also likely to be delayed by a year after engineers concluded that the timetabling for tunnelling was unrealistic.

Despite the £5 billion cut in London's transport budget, the Tube upgrade is set to be allocated £6 billion over four years, including maintenance costs. However, there will be job losses, inevitably leading to more industrial strife.

The widening of the M25 between 10 sets of junctions will go ahead but the future of the Thameslink rail upgrade is still to be decided.