Transport for London (TfL) is expected to borrow £350m from the Government because of a funding shortfall it faces after delays to the £15bn Crossrail scheme.
According to The Guardian, the Department for Transport (DfT) will provide the money to the London Mayor, Sadiq Khan, on a short-term basis. The interest will be paid out of his budget. Talks are ongoing about the terms of the short-term loan, including the rate of interest that will determine the ultimate cost.
The loan is being provided to cover for revenue which TfL was expecting to receive by now from passengers on the Elizabeth Line.
Announcing the loan, Rail Minister Jo Johnson said: “Today, as an interim measure, we are announcing that £350m of short-term repayable financing will be made available to the Mayor for the year 2018/19.
“This will ensure that full momentum is maintained behind Crossrail.”
Sadiq Khan said: “This loan will allow Crossrail to continue its construction work and the testing process.
“An independent review into Crossrail’s commercial practices, cost projections and governance is already well underway, and that will help us understand the exact implications of the project overrunning for both project sponsors – TfL and the DfT.
“Some very challenging work remains to be completed, but we will continue to work alongside the government to deliver this important piece of infrastructure, and we will continue to keep the public informed of our progress towards its completion.
“When open, the Elizabeth Line will be a world-class railway that makes London proud.”