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According to a damning report by auditor KPMG, Crossrail is costing £30 million a week, potentially pushing the new train line even further over budget.
KPMG, which was commissioned by London mayor Sadiq Khan and transport secretary Chris Grayling, found governance failures within the project and claims there is an “80 per cent likelihood” that it will need to use the full £1.6 billion to £2 billion bailout provided by the government last month, according to the Financial Times.
Transport for London says this funding could increase to £2.45 billion if necessary.
Crossrail was originally scheduled to open in December 2018, but it was revealed in August that there was still too much work to be done to meet that deadline. It is now unclear when the Elizabeth Line will go into service, but some estimates say it might not be until the end of 2020.
Chairman Sir Terry Morgan resigned just days before the cash injection was announced, saying he expected to be fired anyway over the government’s disappointment that Crossrail was behind schedule.
KPMG’s analysis claims reporting within the tax-payer funded organisation behind Crossrail was “neither sufficiently timely now sufficiently clear” on how problems within the programme would affect the project.
It also says financial backers the Department for Transport (DfT) and Transport for London (TfL) should have had more power over the board of Crossrail. The report reveals senior executives were paid bonuses totalling £725,000 months before the opening of the line was delayed.
TfL claims Crossrail’s former CEO Andrew Wolstenholme knew well in advance that the project was running behind schedule, pointing to letters from contractors such as Siemens that said other delays were causing a knock-on effect.
According to the Financial Times, Wolstenholme – who now sits on the board of the Hs2 project – was paid more than £768,000, including a £160,000 bonus and a nearly £98,000 pay-off when he resigned in March last year. The previous year, he was paid a total of £950,000 including bonuses.
KPMG said executive pay should be carefully considered and that decisions should be taken “demonstrably in the public interest and linked to the timely and cost-effective delivery of the programme”.
TfL said it was considering KPMG’s recommendations and was working with Crossrail to implement them.