Latest Rail News

10.12.18

Crossrail given £1.4bn bailout as launch date pushed back once again

Crossrail has suffered further delays to its schedule beyond the autumn of 2019 and London transport bosses have today announced a £1.4bn bailout of the flagship project – even worse than first estimates – in what represents yet another blow for the troubled scheme.

A day after the £15.4bn project was due to open according to its original schedule, TfL confirmed a new financing agreement for the Elizabeth Line which will see the Greater London Authority (GLA) borrow up to £1.3bn from the DfT.

On top of a £100m contribution from GLA, a £750m loan will be given to Crossrail by the DfT as a contingency, replacing the original £350m package offered by the government in October. An investigation has found, however, that between £1.6bn and £2bn is needed to see off the project.

Crossrail’s new CEO, Mark Wild, has today announced that core elements of the infrastructure including stations and tunnels are yet to be completed and that, following a review, it has become clear that the already-delayed launch date of autumn 2019 cannot be committed to at this stage.

It has also been announced that Tony Meggs has been nominated by the mayor of London and transport secretary as the new chair of Crossrail. He will replace Sir Terry Morgan if ratified.

Meggs will step down from his role as CEO of the Infrastructure and Projects Authority and oversee the final stages of delivering the Crossrail project, along with the help of Nick Raynsford MP, who has been nominated as deputy chair.

A review by KPMG, which was appointed to investigate Crossrail’s spiralling costs and the delays, indicated that the capital impact of the August delay will be in the region of £1.6bn and £2bn, which it now seems London will be picking up the bill for.

Today’s announcement means the final bill for the Elizabeth Line could reach £17.6bn, and this is now the third rescue plan announced this year.

Sadiq Khan, who has been at the centre of the delay’s controversy, commented: “I haven’t hidden my anger and frustration about the Crossrail project being delayed. This has a knock-on consequence of significant additional cost to the project.  It has been increasingly clear that the previous Crossrail Ltd leadership painted a far too optimistic picture of the project’s status.”

The mayor added that he is confident that, working with TfL and the government, the new leadership “can get the job done.”

Mike Brown, London’s transport commissioner, also noted: “Crossrail Ltd’s announcement of the delay to the Elizabeth line is extremely disappointing and, only now, is the scale of what is yet to be completed becoming clear.

“The confirmation of this funding agreement will now allow Crossrail Ltd and its new leadership to focus on finishing the remaining construction work on the stations and tunnels and then completing the vital safety testing in order to open the railway for passengers as quickly as possible.”

Comments

There are no comments. Why not be the first?

Add your comment

related

Rail industry Focus

View all News

Comment

The challenge of completing Crossrail

05/07/2019The challenge of completing Crossrail

With a new plan now in place to deliver Crossrail, Hedley Ayres, National Audit Office manager, major projects and programmes, takes a look at ho... more >
Preparing the industry to deliver trains for the future

04/07/2019Preparing the industry to deliver trains for the future

The move to decarbonise the rail network involves shifting to cleaner modes of traction by 2050. David Clarke, technical director at the Railway ... more >

'the sleepers' blog

On the right track, Sulzer is awarded RISAS accreditation for Nottingham Service Centre

29/06/2020On the right track, Sulzer is awarded RISAS accreditation for Nottingham Service Centre

Following an independent audit, Sulzer’s Nottingham Service Centre has been accepted as part of the rail industry supplier approval scheme (RISAS). The accreditation reinforces the high-quality standards that are maintained by Sulzer’s... more >
read more blog posts from 'the sleeper' >

Interviews

Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

24/06/2019Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

Andrew Haines, the Chief Executive of Network Rail, has told the Today programme on Radio 4's BBC’s flagship news programme that he would not rule out his organisation issuing future r... more >
Advancing the rail industry with management degree apprenticeships

08/05/2019Advancing the rail industry with management degree apprenticeships

In answering the pressing questions of how current and future generations of managers can provide solutions to high-profile infrastructure projects across the UK, Pearson Business School, part of... more >