Whitehall-backed Garden Bridge project in doubt

Ministerial direction was required by DfT perm sec to provide funds for project

By Richard Johnstone

28 Apr 2017

The controversial project to build a so-called garden bridge in London could collapse after Mayor of London Sadiq Khan said he would not provide any additional financial guarantees for the scheme.

The bridge, which is intended to run from Temple on the north side of the Thames to the South Bank, was subject to a review by former Public Accounts Committee chair Margaret Hodge.

This found that the estimated cost of the project had increased from an estimated £60m to around £200m. The Department for Transport had pledged £40m towards the project, while Transport for London would contribute £30m.

However, Hodge concluded that the scheme represented an increasing risk to the taxpayer. The balance of funds was to be found by the Garden Bridge Trust through private donors, but only £69m had been secured, leaving a gap of at least £70m.

Government backing was only secured after Philip Rutnam, then permanent secretary at the Department for Transport, requested a ministerial direction to support the project, sparking “frustration” at the centre of government.

An NAO investigation into the project found Rutnam, who has since moved to Home Office, requested a ministerial direction to issue funding guarantees for the bridge in May 2016 because “he believed the department to be at the very limit of what he regarded as proportionate or prudent financial exposure to the risk of the project not proceeding”.

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In today’s announcement, Khan said continuation of the project will expose the London taxpayer to additional financial risk, both with regard to the bridge’s construction and its operation and maintenance.

He was therefore not providing the operation and maintenance guarantees to the scheme that were a condition of the planning approvals for the project from the London boroughs of Lambeth and Westminster.

“Having assessed all the information available to me including the findings of Dame Margaret Hodge’s independent review, my view is that providing mayoral guarantees will expose the London taxpayer to too much additional financial risk.

“The funding gap is now at over £70m and it appears unlikely that the trust will succeed in raising the private funds required for the project. I am simply not prepared to risk a situation where the taxpayer has to step in and contribute significant additional amounts to ensure the project is completed.”

It is open to the Garden Bridge Trust to seek to amend the requirements of the planning permission in order to allow the scheme to proceed, City Hall said.

Responding to the report, Trust chair Lord Mervyn Davies said: "We received the mayor's letter with great regret today. We will study the contents of the letter in detail before responding formally.

“The Garden Bridge Trust was set up at the request of Transport for London and the Department of Transport to deliver the project which had received public money. We have had enormous support from our funders and are very confident we can raise the remaining funds required. But sadly the mayor of London has taken a different decision to those in place when the project started.”

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