Crossrail | TfL told to set final cost amid concerns about £275M funding ‘black hole’

In response to London Mayor Sadiq Khan’s draft budget, the London Assembly’s Budget and Performance Committee has urged TfL to set a final cost for Crossrail amid concerns about a £275M funding “black hole” in the project’s finances.

It is one of seven recommendations which relate to TfL spending plans for the coming year (see full list of recommendations below).

In August, Crossrail bosses revealed that up to £1.1bn additional funding was needed to complete the new London railways line, after Covid-19 restrictions further delayed the project.

This replaced the £400M to £650M cost overrun announced in November 2019 and is in addition to the £2.15bn original funding top up agreed.

On 30 November a funding deal for £825M of the £1.1bn was reached. The Greater London Authority (GLA) will borrow the additional £825M which will be repaid using the Mayoral Community Infrastructure Levy and Business Rate supplement.

However, at a Budget and Performance Committee meeting in December, TfL commissioner Andy Byford said that there would be no further delays or cost overruns on Crossrail, but said that this was based on the project being given £1.1bn in funding.

He added that the £825M received would be a challenge and that there was an understanding with DfT that an additional £275M could potentially be required.

The Mayor confirmed at a Budget and Performance Committee earlier this month that after the £825M was spent there was “nowhere else to go […] the Government would need to step in.”

Budget & Performance Committee chair Susan Hall said: “Transport for London is in financial turmoil and has been making headlines since the start of the pandemic.

“Alongside the loss of fare income, Covid-19 has brought home the impact of the delays and cost overruns to major projects such as Crossrail.

“With major questions remaining over TfL’s long-term sustainability, we hope the Mayor will work constructively with the Government to help address these significant challenges.”

A TfL spokesperson said: “Crossrail’s latest cost estimates still show that the project could need an additional £1.1bn for completion.

''Borrowing arrangements have been confirmed to provide £825m and while this currently represents a shortfall on what could be required, the Crossrail team is working to manage these costs and risks to deliver the railway within the funding available.

“TfL and the DfT as Sponsors of the project will continue to closely monitor costs.”

The report also raises concerns about budgets for the Olympic Park and the Old Oak Common housing development. Both have been criticised in separate reports released by the Committee in the past fortnight.

The Committee warned that the Olympic Park risks becoming a “derelict, costly disaster”, while it was critical of the lack of progress made on the West London regeneration scheme.

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