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Railway work to start, MSPs told Rail link project costs increase
(19 minutes later)
Construction on the railway line between Edinburgh and the Borders will begin within the lifetime of the current Scottish Parliament. The new rail line between Edinburgh and the Borders could cost more than twice the original estimate.
Transport Minister Stewart Stevenson said the completion date of 2011 put forward by the previous Holyrood government was "never achievable". The project's completion date has also slipped from 2011 to 2013, Transport Minister Stewart Stevenson confirmed.
Capital costs of the project will be between £235m-£295m, the Scottish Parliament was told. A non-profit making company will also be set up to pay for the bulk of the costs, it emerged.
Mr Stevenson told MSPs the rail link would provide prosperity. Mr Stevenson said the original date put forward was "never achievable", given the decisions taken on the project by the previous Holyrood government.
Clearance works for re-opening the Waverley line got under way last year. The capital costs of the railway, between £235m-£295m, are to be funded by a "non-profit distributing vehicle", meaning the cash will be borrowed from the financial markets.
However, the new Scottish Government voiced concerns about the funding package put in place for the scheme. It is to be repaid by annual charges met from the budgets of the national agency Transport Scotland, and with contributions from councils.
Mr Stevenson told MSPs: "We will deliver a railway that strengthens some of Scotland's poorest communities, spreads wealth to the regions and provides a real, sustainable integrated and cost-effective public transport alternative to the car." Despite opposition party concerns, Mr Stevenson insisted it was a cost-effective borrowing method which avoided high interest rates associated with private finance initiatives and would keep the project in public ownership.
"We will deliver a railway that strengthens some of Scotland's poorest communities, spreads wealth to the regions, and provides a real, sustainable, integrated, and cost-effective public transport alternative to the car," said the minister.
The original estimate for the rail link stood at £129m, at 2002 prices.