PR 1079
HOPE OF SETTLING REVISED FUNDING SOON
The local authorities pushing for a positive decision on a revised funding package for the light rail scheme aimed at tackling severe congestion in south Hampshire are optimistic of an agreement being settled with Government in the coming months.
Hampshire County Council and Portsmouth City Council have been working with the Government to deliver a modified scheme which is affordable by reducing the level of risk transferred to the private sector.
Councillor Keith Estlin, Executive Member for Environment on the County Council, said: "There is no doubt that there continues to be widespread commitment to SHRT, not just from the local authorities but from local Members of Parliament, the Government Office for the South East, and regional planning and development agencies. It represents good value for money and underpins the transport strategy for the whole of south Hampshire. The social, environmental and economic benefits would outweigh the project costs by nearly 2:1. That's taking into account the environmental benefits gained from removing three million car journeys from local roads every year and the regeneration opportunities delivered by improved access in an area with the highest population density in the south east outside London.
"What is also encouraging is the fact that Government asked us to investigate with the bidders whether our revised proposals would improve their offers, while elsewhere light rail projects were put on hold."
Councillor Alex Bentley, portfolio holder for traffic and transportation on the City Council, said: "We believe that this is a transportation scheme which will enable a complete change in the way people in south Hampshire travel to places of work, leisure and play. It's a project where the true value of its implementation can only be proven after it has operated for a couple of years, changing people's travel habits and removing three million car journeys from local roads."
Originally in 2000, the two councils were asked by Government to provide estimates for the project and submit them to bid for funding. Having taken all available advice at the time, an estimated budget of £170 million was forwarded and the Government agreed to meet 75 per cent of the cost. The councils were then able to seek formal bids. Costs increased due to a number of factors outside the councils' control, including greater insurance premiums, high construction inflation, an increase in public utility diversion work and the fact that the tunnel under Portsmouth harbour had to be deeper to accommodate the Royal Navy's new ships. The bids also reflect the finance backers' cautious assessment of the income from fares.
The Department of Transport is engaged in a spending review that will set its budget for the next three years in July. Subject to the revised funding agreement being met, the next stage will be to select the best offer from the two bidding consortia later in the year. Once the preferred bid has been selected, then the Government, Hampshire County Council and Portsmouth City Council would formally confirm funding decisions. It could then be possible to have a contract in place early in 2005 and construction work could start.
ENDS
For further information please contact: Kate Ball on 01962 845626 kate.ball@hants.gov.uk