£70m bill for failed Merseytram project
Jan 17 2008 by David Bartlett, Liverpool Daily Post
Merseytravel image
THE desire for a light rail transport scheme began in 1997.
Almost £5m was spent on unsuccessful proposals before plans for a tram were published in July, 2000.
The scheme was planned with three lines costing £900m, with Line One from Liverpool to Kirkby.
In December, 2002, the DfT gave provision- al support of £170m, with the cost of Line One identified as £225m. Approval was given in August, 2003.
In November, Merseytravel recalculated the costs of Line One at £325m.
From December to June, 2005, Merseytravel sought to use borrowing to pay for the scheme.
Merseytravel also assumed the DfT would pay interest on its £170m contribution based on “informal assurances”.
The report states the DfT denies giving such assurances.
In June, 2005, DfT stated no more than £170m would be forthcoming, meaning a gap in funding of between £26m and £56m, depending on the level of contingency.
In September, St Helens, Wirral and Sefton councils said they were unwilling to support the tram, forcing Liverpool and Knowsley councils to underwrite the funding gap alone.
On October 31, 2005, the costs were stated at £312m, including a contingency of £24m.
In November, Liverpool and Knowsley Councils agreed to meet their share of the £24m contingency, but would not guarantee to cover all cost over-runs.
On November 29, Alistair Darling pulled the plug on Merseytram.
In February, 2006, a High Court challenge to that decision failed at a cost of £1.3m. A total of £70m had been spent.
davidbartlett
