10.12.18
Crossrail set for further £1bn bailout and potential further delay
Ministers are expected to announce a fresh £1bn bailout for Crossrail and admit that the project might need to be delayed beyond 2019.
According to the Financial Times, officials from the DfT and TfL, who have been in emergency talks for months, held further negotiations on Sunday ahead of an “imminent public announcement.”
On its original schedule, the flagship Elizabeth Line project was due to open on Sunday by the Queen, but it has been plagued by spiralling costs, the resignation of its chairman last week, and a nine-month delay announced in August.
Sir Terry Morgan’s resignation has heightened speculation that further problems are yet to be disclosed, and the FT has now reported that people close to the project believe the latest rescue plan will involve £1bn of new funding.
Later this week, Sadiq Khan is likely to set out various cuts to projects to fill the various financial black hole left by Crossrail’s problems, and a TfL spokesperson said “work is continuing between the government, mayor and TfL on finalising a financial package.”
The FT reports that former Labour MP Nick Raynsford is also expected to be appointed as Crossrail’s deputy chairman.
One person close to the project said the new expected open date of Autumn 2019 was now “wildly optimistic” given the current problems with signals, trains and stations which are leading to “growing panic” amongst TfL executives.
Crossrail received an injection of £590m in July, and was handed a £350m government lifeline in October to prevent further delays. The additional £1bn is now needed to address TfL’s “urgent cash flow problems.”
The news will heap more pressure on TfL and Sadiq Khan, who have been heavily criticised over Crossrail’s delays and rising costs. The London mayor has also been accused of “deliberately misleading” the public and London Assembly over when he knew about the delay.
Khan denied the claims. However, before his resignation, Morgan said he was “in absolutely no doubt” that the mayor knew and Khan has now been summoned to a hearing regarding the matter.
Caroline Pidgeon, chair of the London assembly transport committee, said she was “really worried” about TfL’s budget, and forecast a swathe of cuts in this week’s revised TfL business plan.
Image credit Dominic Lipinski