PM may shelve £16bn Crossrail over cost fears

19 May 2008

EXCLUSIVE by Ted Jeory

PRIME Minister Gordon Brown is "more than likely" to shelve the £16 billion Crossrail project for several years, even when it receives Royal Assent this summer, a senior figure in the scheme has warned.

A highly placed source in Crossrail's management team fears the PM will put the cross-London 'super tube' rail link on hold amid increasing concerns about the effect of the credit crunch on the economy.

Crossrail bosses are bracing themselves for the bad news, expected within a few months.

The Crossrail Bill completed its final round of scrutiny before a House of Lords select committee last week, paving the way for a final reading in the Commons and Royal Assent in July.

But although Downing Street finally gave the nod to a £16bn funding package last October, Crossrail chiefs fear the deteriorating economic climate, spiralling Olympic costs and the election of Tory Boris Johnson as Mayor of London will persuade Mr Brown to delay construction.

The source said: "It's only my opinion and not the corporate line, but my strong feeling is that in the current circumstances, the Government will more than likely delay the project by a few years. There's quite a few of us who think that.

"But once we get Royal Assent, the Act will last for 10 years, so we'll still be able to start the engineering fully at any time before that runs out."

Revealing frustration with political and civil service meddling, he added: "Unfortunately, it's yet another example of how this country seems not to be able to run major projects.

"The Treasury never seems willing or capable of being accountable for these things."

If Mr Brown does pull the plug, it will be a devastating blow to the Corporation of London and for Canary Wharf Group, the two organisations which stand to gain the most from Crossrail.

Preparations for a new Isle of Dogs station at West India Quay were expected to start early next year, along with compulsory purchase schemes in Bond Street and Tottenham Court Road in the West End.

As Chancellor, Mr Brown was said never to be a huge fan of Crossrail and believed businesses, particularly the City and Canary Wharf, should foot a larger share of the bill.

Mr Brown is likely to feel reluctant about another major project for the capital, with London now in the control of the Conservatives and with mutterings in the rest of Britain about the scale of public money being ploughed into the Olympics.

But although Crossrail's communications manager Ian Rathbone acknowledged the project was at the mercy of others, he said there was a determination to carry on.

He added: "We will be continuing with the programme that we have laid out.