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Manchester Metrolink poised for rescue

News

A DECISION to go ahead with phase three of Manchester's light rail Metrolink could be made as early as next week, NCE has learnt.

Draft reworked funding plans for the scheme, that would link Rochdale, Oldham, Manchester Airport and Ashton-Under-Lyne with the city centre, were due to be sent to the Department for Transport on Tuesday this week.

They will be presented formally to transport minister Tony McNulty seven days later.

Transport secretary Alastair Darling halted the Metrolink extension along with plans for tram schemes in Leeds and Portsmouth in July because of escalating costs.

Manchester City Council and nine other Greater Manchester councils have been fighting to get the scheme reinstated ever since (see box).

Their efforts were rewarded last week when prime minister Tony Blair and Darling agreed to set up a working party chaired by McNulty to revive the scheme (News last week).

'We have managed to reduce the costs substantially, ' the leader of Manchester City Council Richard Leese told NCE. Substantially, he said, means at least £100M.

The last approved figure for the Metrolink extension was £890M, made up of a £390M government grant, £130M from Greater Manchester Passenger Transport Executive and £300M from the yet to be announced design, build, finance and operate contractor.

But scheme costs rose at least 10% and the contractor's contribution fell significantly because bankers were unhappy that the private sector was being asked to take on the risk of passenger revenues. This pushed up the government contribution to around £500M and prompted Darling to axe the project.

'Now the PTE is guaranteeing more of the passenger risk and the contractor is taking a bigger equity stake, ' Leese said. The council now needs the government to contribute the £390M it has previously promised.

'We are making progress, ' Leese said. 'We won't assume anything until we get a decision but we believe our case is overwhelming.'

Close to £200M has already been spent developing plans for the Metrolink extension, which would be money down the drain if the scheme did not go ahead, Leese said.

The project costs also include £100M worth of essential refurbishment to existing Metrolink lines. The existing heavy rail link from Manchester to Oldham and Rochdale would also need £500M spent on it if the extension was cancelled.

A recent report from economic forecaster DTZ estimates the cost to Manchester of the scheme not going ahead will be £1.8bn a year by 2020.

'The whole of the economy and development of the east of the conurbation is underpinned by Metrolink, ' Leese said. 'Its development is fundamental to Manchester over the next 25 years. We have just got to win (our case). It is just too important for us to do anything other than win.'

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