Crossrail on course to achieve value for money
- Published on Friday, 24 January 2014 09:53
- Written by Govtoday staff
Taxpayers' interest in the Crossrail programme has so far been well protected, according to the National Audit Office.
If progress in providing the new rail service for London and the South East can be maintained and risks managed, then the programme is on course to achieve value for money.
When complete, the line will run from Maidenhead and Heathrow Airport in the west, to Abbey Wood and Shenfield in the east. Crossrail Limited, a wholly-owned subsidiary of Transport for London, is implementing the programme, with Network Rail carrying out work to improve existing surface infrastructure.
Joint sponsors the Department for Transport and Transport for London have established a £14.8bn funding package to build the infrastructure. The funding is a combination of direct grant funding from both bodies, including £5bn from the department, and borrowing by Network Rail and Transport for London. Businesses have also contributed to the funding package, most notably through a supplement to London business rates, but the department has not secured all the private sector contributions for which it had hoped.
There are also additional costs, including the estimated £1bn cost of buying trains, most of which will be funded directly by TfL, with the department providing £100m; and the £316m cost to develop plans for the railway, to which the department contributed £175m.
According to today's report, the strategic need for Crossrail has become clearer over time as increased population and employment growth in London have been forecast. It is also expected that Crossrail's benefits will outweigh its costs. The department forecasts that Crossrail will bring £1.97 of transport benefits for every £1 of cost, and there is also potential for it to bring wider economic benefits.
About half of the infrastructure work is now complete. Progress is just behind schedule, but Crossrail Limited has taken steps to improve the progress against schedule and it remains confident that it will meet the planned delivery date. Forecast costs remain within available funding of £14.8bn. However, Crossrail will not fully open until December 2019 and a number of risks remain, in particular the delivery of the Crossrail trains and the appointment of the operator.
Amyas Morse, head of the National Audit Office, said: "The sponsors and Crossrail Limited have so far done well to protect taxpayers' interests, by taking early action to stop costs escalating and, during construction, tightly managing the programme. There is still a long way to go and the department must continue to manage risks to protect its investment in Crossrail."