Published: 12:47, 21 March 2002
TAXPAYERS could be forced to foot a multi-million bill to keep afloat the company building the Channel Tunnel rail link, MPs have warned.
A report by MPs on the Public Accounts Committee has concluded that it is likely that the deal agreed by the deputy Prime Minister in 1998 would lead to “substantial amounts of money” being handed out by the government.
At the time Mr Prescott rejected a bid by London and Continental Railways for an additional £1.2million in grants and instead had to accept a deal in which some £4billion worth of bonds were issued.
Now MPs say that deal was flawed. Committee chairman Edward Leigh said: "The department allowed this deal to proceed on the basis of a business plan that was fundamentally flawed, based as it was on inherently uncertain forecasts of passenger numbers - all very reminiscent of the Dome.”
The first stage of the link from Folkestone to north Kent is already well underway and is on schedule.
The former Faversham and Mid Kent MP Andrew Rowe, a long-standing critic of the deal, said he was not surprised at the findings but said it was imperative both stages of the scheme was finished.
“The idea that the link should be a priority project on a rail network where the signals cannot be made to work is very weird. Now we have got this far, however, it must be finished. There will be nothing to be gained from having a service which travels fast from Paris to Kent and then crawls along for the rest of the way to London,” he said.