Londoners could be saddled with higher transport fares, increased business rates and greater council tax fees to help fund the £31bn Crossrail 2 scheme, according to an influential business organisation.
In its report Paying for Crossrail 2, campaign group London First outlines how a 1% rise in fares across Transport for London’s (TfL) network, along with higher council tax and business rates and a land value capture system could raise £15bn to fund Crossrail 2 construction.
Transport secretary Chris Grayling backed plans for Crossrail 2 last year but cautioned London must pay for half the costs during construction, which would start in the early 2020s.
Following input from its members, London First – which represents more than 200 employers – found that the capital will have to stump up £200M each year alongside additional borrowing to fund Crossrail 2 during its construction.
London First chief executive Jasmine Whitbread said: “We need to step up planning for long-term investment in the UK’s infrastructure and it’s clear that London has to pay its way.
“What we need now is for the Mayor and government to strain every sinew to get costs down and ensure tax and fare rises are a last resort, rather than the easiest option. This means learning from the experience of Crossrail 1 to save money when building tunnels and stations, using private finance for new trains and considering the sale of existing assets, like the Crossrail tunnel itself to free up funds.”
London First claimed a 1% fare rise could generate £30M each year, while a council tax supplement - similar to that used to help fund the Olympic Games - could raise £150M each year.
London bosses could then borrow against the extra revenue streams to release funds before the line opens in the 2030s.
TfL is already looking into a land value capture system to fund the mega-project, meaning property owners whose homes gain value due to Crossrail 2 would pay a levy.
Mayor of London Sadiq Khan has repeatedly stressed Crossrail 2 is vital to London’s future growth.
A spokesperson for Khan said: “Without Crossrail 2, the major suburban rail lines across the south of England, already nearly full to bursting, could collapse under the sheer number of passengers over the decades ahead - with dangerous levels of overcrowding, and major national hubs like Euston, Waterloo and Victoria unable to cope.”
Like what you’ve read? To receive New Civil Engineer’s daily and weekly newsletters click here.