London needs to fund £30bn Crossrail 2, business group says – Financial Times



Londoners could be asked to pay higher public transport fares and property taxes to fund the proposed £30bn Crossrail 2 project, under plans put forward by London First, the business lobby group.

Chris Grayling, the UK transport secretary, has backed the new train line, which would link London’s Euston, Victoria and Clapham Junction stations. But Mr Grayling has demanded that London’s businesses, commuters and residents pay half of the project’s construction cost.

In a report to be published this week, London First, which represents 200 businesses in the capital, proposed a 1 per cent increase in fares on Transport for London services, which would generate about £30m a year. The rise would amount to about £1.50 a month for a commuter using a zone 1 to 3 travel card.

Londoners could also be asked to pay extra council tax, much like contributions that were introduced ahead of the 2012 Olympic Games. The “Olympic precept” amounted to an average £33.80 a year in extra taxes per household.

Businesses would also be asked to contribute to the cost, even though they are already helping to pay for Crossrail 1— the £14.8bn train line that will run from Maidenhead and Heathrow airport in the west to Abbey Wood and Shenfield in the east — through a supplement to business rates. Crossrail 1 is due to open next year but businesses are set to continue paying the extra tax for the project to about 2030.

Jasmine Whitbread, chief executive of London First, said: “We need to step up planning for long-term investment in the UK’s infrastructure and it’s clear that London has to pay its way.

“This means London’s commuters, businesses and residents will have to put their hands in their pockets to see the benefits of better and quicker journeys, and more homes being built along the route.”

Crossrail 2 is seen as integral to the HS2 high-speed rail project. The £26bn first phase of HS2, which is expected to open in 2026, will run from London’s Euston station to Birmingham.

HS2 aims to cut journey times from Birmingham to London to 49 minutes, and from Manchester to London to just under an hour and 10 minutes.

But these savings will be lost in the scrum of passengers, queues and poor onward connections at London’s Euston station without Crossrail 2, HS2 executives have said. HS2 is expected to make the problem worse, carrying 10 high-speed trains an hour through the station, each carrying up to 1,000 passengers.

Euston station is already severely overcrowded at more than double its stated 20m passenger-a-year capacity.

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London First is pressing for Philip Hammond, the chancellor, to pave the way for Crossrail 2 in the Budget in November by giving the go-ahead to a consultation on the project.

But there are concerns that ministers will be perceived as concentrating on London’s transport system while neglecting other parts of the UK, especially after the recent cancellation of rail upgrades, including electrification in South Wales and the Midlands to Sheffield and Nottingham.

A spokesman for the Labour mayor of London, Sadiq Khan, said: “Without Crossrail 2, the major suburban rail lines across the south of England, already nearly full to bursting, could collapse under the sheer number of passengers over the decades ahead.

“With dangerous levels of overcrowding, and major national hubs like Euston, Waterloo and Victoria unable to cope.”