Research confirms benefits of Crossrail 2
- Supply chain for the project could support thousands more jobs around the country, adding over £1bn to the West Midlands economy, over £200m to the North East and up to £170m to the Scottish economy
- KPMG analysis suggests productivity benefits could be worth up to £102bn to the UK economy
- London could fund over 50 per cent of the new railway
Homes, jobs, productivity and economic growth could be boosted far beyond the proposed route of Crossrail 2, new research from Transport for London (TfL) and Network Rail has found.
The research, carried out to inform discussion of the railway during the Government's spending review this autumn, highlights how all parts of the country could benefit. Crossrail 2 will serve London, Hertfordshire and Surrey and provide capacity for 270,000 more people to access central London during the busy morning peak.
The railway will connect into the Underground, Crossrail, Thameslink, National Rail network, HS2 and High Speed services to Europe, bringing more than 800 destinations around the country within one interchange of a Crossrail 2 station, including towns in the Midlands and the North.
Crucially, Crossrail 2 would release space on some of the most congested railway lines into London allowing additional trains to operate into Waterloo and Liverpool Street during peak periods. As many as 11,800 more seats could be available on Network Rail services from Hampshire and Surrey into Waterloo during the peak, as well as those offered by Crossrail 2. Areas with significant growth potential, including Cambridge, Stansted, Portsmouth, Basingstoke and Southampton could all benefit.
By addressing transport and housing constraints, which are limiting growth in some of the highest productivity sectors of the economy, Crossrail 2 could make a significant contribution to the UK's productivity challenge. KPMG has estimated this to be worth up to £102bn to the UK economy in additional output, generating significant extra tax revenues to help fund the scheme.
Crossrail 2 will also support the engineering, construction and manufacturing sectors through a supply chain stretching across the UK. Analysis based on the Crossrail supply chain shows that small and medium sized enterprises (SMEs) could benefit from more than £5bn of spend and that Crossrail 2 could add over £1bn to the West Midlands economy, over £200m to the North East and up to £170m to the Scottish economy.
Uniquely among major transport investments currently in the planning phase, local funding sources can meet over half of the cost of Crossrail 2. These sources include fares revenue, the Business Rate Supplement (BRS) and Mayoral Community Infrastructure Levy (CIL) currently being used to fund Crossrail, and a continuation of the existing Council Tax precept. This local contribution is in addition to increased tax receipts from new economic activity enabled by Crossrail 2 - including additional Stamp Duty receipts from the homes unlocked - and means that the project could generate significantly more tax income for Government than it spends on the scheme.
Michele Dix, TfL's Managing Director for Crossrail 2, said:
'This report sets out what Crossrail 2 can deliver not just for London but for the rest of the South East and the country as a whole. This transformative new railway will help drive growth in jobs and housing and add billions of pounds to the UK economy as well as providing much needed extra rail capacity to meet the needs of our rapidly growing population.'
Chris Curtis, Network Rail's Head of Crossrail 2, said:
'This report highlights that Crossrail 2 is the best long term answer to meeting the growing demand for rail travel across the region. As well as opening up new regional connections across London, this new railway will deliver significant extra capacity for services into London Waterloo from Surrey, Hampshire and beyond and into London Liverpool Street from Hertfordshire and Cambridgeshire supporting economic growth from the Solent all the way to the Wash.'
Alasdair Reisner, Chief Executive of The Civil Engineering Contractors Association, said:
'The economic benefits of Crossrail 2 will be felt across the length and breadth of the UK, potentially supporting 60,000 full time jobs in the supply chain and providing a boost to UK engineering, construction and manufacturing sectors. Improving the way manage our vital infrastructure, through visibility of investment and workload enables investment in skills, equipment and innovation, reducing delivery costs and making savings for the taxpayer.'
The publication of the new report follows the recent launch of the Crossrail 2 Growth Commission, which will help ensure the opportunities for regeneration, housing and jobs, that are made possible by the new railway, are developed to their full potential. A public consultation will begin next month, providing more information about the scheme.
Notes to Editors:
- Crossrail 2 will run underground through new 36km twin-bore tunnels between Wimbledon and Tottenham Hale and New Southgate, joining with the existing National Rail networks in Surrey and Hertfordshire. It will provide a number of interchanges with the Underground and National Rail network.
- Crossrail 2 will create a new high frequency, high capacity rail line with shorter journey times between south west and north east London. Its route is designed to address capacity constraints as well as providing vital new connections across the capital supporting the UK's single largest employment area, providing opportunities for thousands of new jobs.
- The new railway will serve some of the UK's most deprived areas, allowing regeneration and enabling new housing development. This includes some of London's former industrial areas such as the Upper Lea Valley which is one of the Capital's largest Opportunity Areas, but has unrealised potential because of poor transport links.
- In 2014, PricewaterhouseCoopers (PwC) published a Funding and Financing Study which showed how existing sources available to the Mayor could cover over half the cost of the scheme.
- The cost of Crossrail 2 is estimated at £27 - 32bn, including building the network, rolling stock and a significant contingency which has to be applied to projects of such scale.
- Subject to powers and agreeing funding, construction could start around 2020 and be operational by the early 2030s