Friday 24 July 2020 1:10 pm

TfL may halt Crossrail 2 work over government funding review

Transport for London (TfL) today warned it may have to pause work on some of its biggest infrastructure projects, including Crossrail 2, unless it gets a new funding deal from the government.

The capital’s transport operator this morning set out its revised budget for the year, saying it would need £3.5bn due to the damage done by the coronavirus pandemic.

Read more: TfL’s financial blackhole hits £3.5bn as commuters stay home

As a result, it said that it had had to make some “very hard choices” about which of its projects it could take forward.

“The budget sets out which projects TfL intends to advance in the short term and which projects would require further certainty over government support before they could be progressed”, it said.

“Without the revised funding model that London needs, which would give long-term certainty of sustainable funding, some projects will be unable to progress”.

It then said that it was working to find “future funding options to deliver” the Bakerloo Line extension to Lewisham, the Crossrail 2 rail link, and the DLR extension to Thamesmead.

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“TfL will continue its discussions with Government, whilst being realistic about what will be affordable over the next decade”, it added.

The combined cost of the three projects is £28.8bn, according to TfL estimates.

According to its revised budget, TfL “cannot currently afford to progress them all”.

A DfT spokesperson said: “It is deeply disappointing that the schedule has been further delayed. In addition to the issues the project has experienced from the Covid-19 crisis, Crossrail Ltd have faced challenges in preparing for the start of intensive operational testing.

“The DfT will continue to work with Transport for London as they oversee Crossrail Ltd’s delivery of the new railway as soon as safely possible.”

The threat comes after the government announced the terms of reference for a review into the financing of TfL’s, which said it would explore “alternative funding models”.

Speaking to MPs on Wednesday, London mayor Sadiq Khan said that allowing London to spend its own tax take would be one option.

Read more: Sadiq Khan suggests London tax autonomy in new TfL bailout deal

“The government has two options really, looking at how things are done around the world.

“One is for them to give us a grant for the short or medium term to cover the fact that we cannot get the level of fares in at the moment. The second is proper fiscal devolution”, he said.

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