The Elisabeth Line’s Tottenham Court Road Station, platform level concourse at Dean Street ticket hall, July 2018 (Crossrail Ltd)

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Fury as London’s Crossrail busts budget and revised completion date

11 December 2018 | By GCR Staff | 2 Comments

Europe’s biggest infrastructure project, Crossrail in London, was said to be in “shambles” yesterday, with its delivery body accused of “failed governance” as its revised completion date went out the window and the UK government announced a new bailout package of £1.4bn to get it built.

The 118-km east-west railway that tunnels for more than 40km under central London was originally set to cost £15.4bn and be running as of this past Sunday, 9 December.

This really is the worst case scenario– Caroline Pidgeon, London Assembly Transport Committee

Now, thanks to problems in the central London stretch, its “overall funding envelope” has ballooned to £17.6bn, the government confirmed, with Crossrail Ltd. admitting that it no longer knew when the railway would be complete.

The final cost has not been confirmed. The Department for Transport will loan Transport for London (TfL) up to £750m if more is needed.

Its revised opening date of Autumn 2019, set in August this year, “could no longer be committed to at this stage”, the delivery body said, adding: “It has now become clear that more work is required than had been envisaged to complete the infrastructure and then commence the extensive testing necessary to ensure the railway opens safely and reliably.”

Politicians in London were furious at the extra cost, because the £1.4bn will come from a central government loan of £1.3bn to the Greater London Authority (GLA), plus £100m of the GLA’s own cash.

“This financing package reveals the extent of the shambles that the Crossrail project has become,” railed Gareth Bacon, chairman of the London Assembly Budget & Performance Committee, adding that the figures “will stagger most Londoners”.

Pointing out that the £100m can no longer be spent elsewhere, he said: “While Crossrail will one day prove a huge boon to the capital’s economy it is currently a drag and an embarrassment. We’re pleased this project has been kept afloat but deplore the failings that made such drastic remedial action necessary in the first place.”

Chair of the London Assembly Transport Committee, Caroline Pidgeon, called the bailout “eye-watering”.

“This really is the worst case scenario. Londoners are having to foot an even bigger bill than anticipated and the opening is now at an unspecified time,” she said.

London Mayor Sadiq Khan used the occasion to score a point against ex-Crossrail chairman Sir Terry Morgan, who resigned over the delays six days ago, on 5 December.

The pair had a public spat over whether Khan had been told about the problems and delays before Crossrail Ltd. announced them officially in August, with Morgan insisting Khan had, and Khan insisting he hadn’t.

After the bailout package was announced yesterday, TfL released more than 100 documents relating to Crossrail, which Khan said proved he hadn’t been officially informed.

“I remain deeply angry and frustrated at the delays and cost overrun, and these documents are a serious indictment of Crossrail Ltd’s governance,” Khan office said.

“It is clear that as joint sponsors, TfL and the Department for Transport should have been told much more, far sooner by Crossrail. That’s exactly why I asked TfL to commission an independent review of the project’s governance and why I asked the NAO to investigate what happened.”

In a statement carried by Crossrail’s announcement yesterday, Khan went further: “It has been increasingly clear that the previous Crossrail Ltd leadership painted a far too optimistic picture of the project’s status,” he said.

The bailout casts more doubt on budget and schedule predictability for large, public infrastructure projects, especially since Crossrail insisted repeatedly that the project was on time and on budget since work began in 2009.

“If there is a definition of infrastructure hubris, then Crossrail’s mantra ‘on time and on budget’ surely is it,” wrote the BBC’s transport correspondent, Tom Edwards, after the August revelations. “I’d be surprised if that phrase is ever used again.”

Mayor Khan asked TfL to commission independent reviews into Crossrail Ltd’s financing and governance arrangements. These are being undertaken by KPMG and are nearing completion.

Khan and the Secretary of State for Transport Chris Grayling also yesterday confirmed they have nominated Tony Meggs to be the new chair of Crossrail Ltd. This needs to be ratified by the Crossrail Ltd Board. Meggs is currently CEO of the Infrastructure and Projects Authority.

Former MP Nick Raynsford was also nominated as Crossrail Ltd’s deputy chair.

Image: The Elisabeth Line’s Tottenham Court Road Station, platform level concourse at Dean Street ticket hall, July 2018 (Crossrail Ltd)