Crossrail faces GBP 1bn ‘savings’ cuts20 October 2010
‘Savings’ cuts of GBP 1bn (USD 1.6bn) have been made to the Crossrail project, delaying completion by 12 months. Under scrutiny during the recent Comprehensive Spending Review, the upper limit cost of the project has now been reduced to GBP 14.5bn (USD 22.8bn). As a result of this, the funding for the project has been reduced in line with the most recent projections.
Crossrail played down the cuts. Chairman Terry Morgan said “We welcome today’s strong statement by the Government of it’s firm support for the project. Today’s decision removes any remaining doubt that Crossrail is going ahead and that it will be built in its entirety.”
Crossrail claimed the savings can be found in “engineering-led solutions” and the “reprogramming of the central tunnels programme” and as a result, the project is not suffering any cutback in terms of scope.
The awarding of the central running tunnel contracts was delayed earlier this year to be awarded in the start of 2011. At the time of the delay there were fears that the spending review would impact on these contracts.
It is anticipated that Crossrail will add GBP 42bn (USD 66bn) to the economy, GBP 6bn more than previously thought. With this comes GBP 17bn (USD 27bn) worth of tax generation, 14,000-21,000 jobs created at the peak of construction and the extension of a 45-minute London business commute to a further 1.5 million people.