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The Mayor confirmed that there will be no fare rises to pay for Crossrail, the recently agreed new £16 billion west-east railway line across London, linking Berkshire through Central London with Essex. 

"The financing model for Crossrail, as already announced, relies on £5.2 billion from government, a supplementary business rate of 2p applied for 25 years to properties with a rateable value of more than £50,000 and the fare income from passengers on the route itself at standard Transport for London zonal fares - with a premium fare applying only to Heathrow airport. No fares increase in London is required," Livingstone said.

The Mayor maintained that the story that fares may rise due to ‘interest rate risk’ is false. He said that the interest rate assumption in Crossrail financing is of a 6 per cent. Currently relevant rates are below this at 5.2 per cent. At present Transport for London, in common with other local government bodies does not have the legal right to hedge the interest rates at which it borrows, while private sector companies do have this right. As part of negotiations with government Transport for London will seek that right - in which case Livingstone claims future interest rate risk is removed.

"Second, even if Transport for London were refused this right, any interest rate increase would not lead to fares increase, but to extension of period of the supplementary business rate beyond 2035. Therefore, it is clear that there is no 'interest rate risk' which would require fares increases for Crossrail."

Crossrail is scheduled to open in 2017. The 73-mile long connection will have 38 stops and will enable business travellers to travel from Canary Wharf to Heathrow Airport in just 43 minutes. The journey will just take 25 minutes for City workers, making Heathrow quicker to reach than City Airport. 

Related links

• Crossrail
• Greater London Authority
• Transport for London