Fears for the future of London’s £16bn Crossrail scheme resurfaced this week after the Conservatives said they could scrap it if they win the next General Election.
The Conservatives said they planned to review “all major projects” should they come to power, and have already committed themselves to axing a second runway at Stansted.
Fears about the Conservatives’ commitment to Crossrail surfaced during a debate on Treasury spending in the House of Commons last week. Chief secretary to the Treasury Yvette Cooper clashed with her Conservative opposite number Philip Hammond when she asked him if his party backed the scheme.
“Every single programme and project will have to be reassessed and re-evaluated.”
Hammond would only say that all projects would have to be reviewed because of impact of the recession on the public finances.
“We believe that Crossrail is a good project. It fits very well with our agenda of improving rail infrastructure,” said Hammond.
“But do the government have no conception of the scale of the hole that they have dug? Every single programme and project will have to be reassessed and re-evaluated.
“Each project will have to demonstrate its value for money and its effectiveness in an extraordinarily tight fiscal climate created by the disaster that the government have visited on this country,” he said.
London’s Conservative mayor Boris Johnson has consistently backed Crossrail, and Conservative Transport for London board member Stephen Norris insisted that Crossrail was going ahead.
Value for money
A Conservative Party spokesman said of the proposed review: “We are not talking about specific projects. We have set out examples of projects we will cut. And we have clearly set out our principles: that all programmes must demonstrate value for money, and we will be seeking to get value for money in all spending. We will set out more detail in due course.”
“There is no change to our position that Crossrail is an important piece of infrastructure for London. That is why we backed it,” he said.
This week outgoing Crossrail chairman Doug Oakervee told NCE that cancelling Crossrail would have no immediate benefit to the Treasury, as very little of the early spending is centrally funded (see below).
A source involved in bids for Crossrail funds agreed, saying: “It would benefit the Treasury if they pulled back the funding committed to the long term transport fund. But most of the Crossrail funding doesn’t come direct from the Treasury anyway.”
Nevertheless, Canary Wharf is ploughing ahead with the £500M Isle of Dogs station.
Underwritten by TfL
TfL core contribution £2.7bn
London Underground ‘interface savings’ £0.4bn
Sale of surplus land and property £0.5bn
Developer contributions £0.3bn
London Planning Charge £0.3bn
Underwritten by DFT
DfT grant £5.1bn
BAA/City of London Corp £0.5bn
Network Rail £2.3bn
Depot operating lease £0.5bn
Additional City of London £0.1bn
Less residual costs £0.4 bn