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Crossrail could be mothballed as TfL financial crisis continues

THE delayed project to build Crossrail under central London, connecting it to existing railways on either side, may be held up once again – this time by the Covid pandemic and its effect on Transport for London revenues.

The central section should have opened in 2018, but progress has been delayed by various problems including train software and the fitting-out of stations.

It has been reported that the new transport commissioner Andy Byford has written to the Department for Transport’s permanent secretary Bernadette Kelly, warning her that the continuing financial straitjacket at Transport for London means that Crossrail is now in need of £80 million from the government if work on the project is to continue without interruption. Mr Byford has also warned that without this funding, he could ‘relinquish responsibility’ for Crossrail, which is now expected to cost £18.7 billion after a further reappraisal in August this year.

According to a Whitehall source quoted by Sky News, his letter including the phrases: ‘If agreement is not reached this week, we will have no option but to mothball the project and to seek alternative governance for its eventual completion,’ and that Crossrail was ‘no longer able to make any further financial commitments’.

Mr Byford is said to have continued: ‘I sincerely hope that we can avoid such a Doomsday scenario.’

Transport for London received a second tranche of financial support from the government at the start of this month. The additional funding, worth some £1.8 billion in a combination of direct grants and new borrowing, is intended to keep TfL’s normal services going until March, but did not apparently allow for any Crossrail costs.

Mr Byford has reportedly explained to Ms Kelly: ‘We therefore do not have the financial headroom to provide additional funding unless the government provides funding certainty now by agreeing to the heads of terms we have submitted to you … These heads of terms include the majority of Crossrail’s funding deficit being covered by borrowing from the GLA [Greater London Authority], which is, in our view, an extremely good deal for the government given the wider financial impacts of current circumstances and ensures that London continues to pay for the majority of the additional funding required.’

After the news of the new funding broke at the start of this month, TfL had said: ‘Discussions on funding the additional costs to complete the Crossrail project are not included as part of this funding package but are being progressed in parallel, remain constructive and are expected to conclude soon.’ It has now added: ‘TfL, the GLA and government all continue to have discussions around the additional funding needed to complete the Crossrail project.’

The DfT said: ‘The government remains committed to the efficient completion of the project, in a way that is fair to UK taxpayers, and that ensures London – as the primary beneficiary of Crossrail – bears the additional costs. We are working with the Greater London Authority and Transport for London to develop a funding solution to see Crossrail’s completion. It is unfortunate, in contrast to other construction projects, the Mayor chose to unnecessarily halt work on Crossrail during the pandemic.’

Sky has also quoted a ‘mayoral source’ as saying: ‘TfL has stepped forward and taken on full responsibility for delivery of the Crossrail project and, at the government’s insistence that “London pays”, the current funding proposal will see the vast majority of these costs covered by Greater London Authority borrowing.

‘This offer was made to ministers months ago and would mean London would cover more than its fair share of a project whose financial benefits will overwhelmingly go to the Treasury. It is inconceivable that a deal cannot be done on terms so generous for the government.‘

The RMT union, meanwhile, is concerned about the implications for jobs.

RMT general secretary Mick Cash said: ‘What’s happening between the Government and TfL is nothing short of a disgrace. As we approach next year’s London Mayoral Election it’s clear the Government are using TfL and our members as a political football and rather than stick to their pledge of “Building Back Better” they’re starving TfL of vital funds and playing games with workers’ livelihoods.

‘London transport and its workforce are vital to the economic recovery from Covid-19 and RMT will not be afraid to do whatever is necessary to protect jobs and livelihoods.’

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