Commuters will be able to use Oyster Pay as you go on overground rail services in the capital from January 2, creating, for the first time, a fully integrated transport payment system for London.

The Mayor of London, Boris Johnson, said the “Oysterisation” of transport services - including Clipper river services on the Thames - heralded a “landmark day for London” - as he made the announcement with Lord Andrew Adonis, the Transport Secretary, at Balham station on Monday.

Lord Adonis said the move - completed following negotiations with several civic bodies and train operating companies (TOC’s) - was the culmination of decades of work and “would transform travel in London”.

The news is especially welcome for south Londoners, who have less access to the Tube than their northern neighbours and, therefore, rely heavily on the overground network, which is generally more expensive.

From January, travel between zones 1 and 6 will be easier - but as train operators will still dictate overground prices, most similar journeys underground will still be cheaper.

Mr Johnson said: “It has ended the crackers situation of Londoners not being able to use Oyster on every commuter route in the capital . . . the unbelievable reach of Oyster truly hammers home that this is a landmark day for Londoners.”

Lord Adonis said Oyseterisation had been promised, but delayed, several times and the Department of Transport had paid “tens of millions” to TOC’s to force the deal through.

Sadiq Khan, transport minister and Tooting MP, conceded: “The department had to pay more than it would have liked but the deal was too important for commuters for it to fail.”

He added: “These were the most complex negotiations I have been involved in. They involved two Mayor’s of London, four secretaries of state, Transport for London (TfL) and all the train operating companies (TOC’s).”

TfL invested £40m in Oyster card infrastructure in preparation for the London-wide roll out, but Mr Johnson admitted London had waited “far too long” for an integrated system.

He said delays with the implementation had proved there was “a democratic argument” the Mayor should have more decision making powers over rail decisions affecting the capital.

He said: “If we look at the stations we have taken under control I think we can make a strong case for taking a role in future rail decisions.”

Sharon Grant, chairwoman of London TravelWatch, warned people would still need to check to get the cheapest deals, but said: “This is a big step towards the integrated transport network London needs and deserves.”

Battersea MP Martin Linton said: “For the last century Clapham Junction was not even on the tube map, but from January you can click in and click out with your Oyster card to travel in any direction and Clapham Junction is a major interchange on the Oyster map.”

Councillor Guy Senior, executive member for planning and transportation at Wandsworth Council, said: “Passengers will no longer have to deal with frustrating inconsistencies between payment systems or queue up for tickets in overcrowded stations."

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