Orders of the Day — Crossrail Bill

Part of the debate – in the House of Commons at 4:11 pm on 19th July 2005.

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Photo of Alistair Darling Alistair Darling The Secretary of State for Scotland, The Secretary of State for Transport 4:11 pm, 19th July 2005

I wish to answer the hon. Lady's point first. You made a fair point, Mr. Deputy Speaker, and I understand that some 18 hon. Members are down to speak. I do not want to make a Budget-length speech, and I shall now concentrate on the cost issue.

We think that Crossrail will add some £20 billion to the UK's GDP. It will also benefit London substantially through congestion relief and additional capacity, which will assist commuters. That is why it is necessary to build Crossrail. We think that Crossrail will cost some £15 billion or £16 billion at today's prices. The Bill envisages construction between 2008 and 2015, and, if one looks at the money that would be spent in those years, adjusted upward to take account of inflation, that is the probable order of magnitude.

I said last year that my Department, together with the Treasury and Transport for London, would take forward work on alternative funding mechanisms that could be used to raise a contribution from London. Most London business organisations are willing to contribute, because they perceive the direct benefit that London as a whole will receive. However, in light of the work that is being done by Sir Michael Lyons in reviewing local government funding more widely, it makes sense to see what he recommends before deciding the detailed balance of funding on Crossrail. My right hon. Friend the Chancellor and I have therefore decided to defer the consultation on alternative funding mechanisms until after the Lyons review.

It is important to demonstrate our commitment to the project, which is underlined by the fact that we are taking this Bill forward to establish the principle and route of Crossrail. Nevertheless, as the hon. Lady says, it is a significant sum. The cost will be some £15 billion or £16 billion in cash terms. It is a huge challenge, both in terms of funding and in respect of the wider fiscal position, so we need to get the funding right and to take the time to make that happen. My Department will continue to take those issues forward, including the issue of additional development funding, working together with Transport for London.