Crossrail’s £1 billion rolling stock has been confirmed by Danny Alexander as the first scheme to receive government support through the UK Guarantees initiative.
Speaking at the Liberal Democrat conference this afternoon, the chief secretary to the Treasury, said the government needs to secure the rolling stock for the ‘biggest infrastructure project in Europe’.
CN reported yesterday that the rolling stock - being delivered largely through the private finance initiative - was being considered as the first scheme to be underwritten by the government balance sheet.
“We need to make sure the rolling stock is delivered on time. Right now there’s difficulty raising the necessary private funding.
“[That is why] Crossrail will be the first project to qualify for a new government guarantee - and it will be the first of many across Britain I’m sure.”
Mr Alexander said it has come after the government has ‘rebuilt the confidence in the nation’s ability to pay its way in the world’.
CN revealed last week that the first scheme had been ‘agreed in principle’. The Thames Tideway Tunnel is also being tipped for a UK Guarantee.
John Cridland, Confederation of British Industry Director-General, said today: “I welcome the first announcement of the use of UK Guarantees to underpin the funding of new Crossrail trains.
“This is an important step forward, and I hope to see more announcements as quickly as possible.”
The stock and depot contract is the largest single contrac Crossrail will let. It is due to be awarded in spring 2014 in time to provide stock in May 2017 on the Great Eastern Main Line into Liverpool Street.
The £1bn cost of rolling stock and depot is not included as part of the overall £14.8bn of Crossrail funding. In February, Crossrail’s Sponsors (Department for Transport and Transport for London) said private finance will meet a substantial part of the £1bn cost.
Government announced that they would provide a grant contribution of up to £350m, aimed at easing financing costs for bidders and the public purse. The rest is coming through the PFI.
The four shortlisted bidders for the Crossrail rolling stock and depot procurement were issued with tender documents in February. They include Bombardier Transportation (UK) Limited; Construcciones y Auxiliar de Ferrocarriles SA (CAF); Hitachi Rail Europe Limited; and Siemens plc.
Crossrail will pass through 37 stations from Maidenhead and Heathrow in the west, central London to Shenfield and Abbey Wood in the east.