Gateway Plus - Funding

Funding

When completed, it is expected to have cost over £550 million. The financing for the project depends upon a mixture of public and private funding. Private funding will account for £150 million whilst the rest will be publicly funded. The four key funding partners for the project are:

• Network Rail
• Birmingham City Council
• Advantage West Midlands
• Centro

In May 2006, outline funding applications were submitted to Government agencies including the Department for Transport. Gateway Plus has been subject to uncertainty in funding, a problem Mike Whitby claimed to have been responsible for removing in early October 2006. However, a report later said that the financial part of the project had already been secured before he came to power as the leader of Birmingham City Council.

In March 2007, Birmingham City Council was given an additional £40 million by the Government after they described the West Midlands Local Transport Plan being scored as "excellent". £3 million of this was put towards the Gateway Plus project. A £128 million funding package was announced by British Government for the Gateway Plus project in July 2007. It was announced by Ruth Kelly, the Transport Secretary, when she unveiled a government White Paper Delivering a Sustainable Railway, which also includes the upgrading of 150 further stations. This is the first of three tranches of funding required for the development. The other two tranches of funding total £223 million.

In October 2007, it was reported by the Birmingham Mail that the Comprehensive Spending Review by Alastair Darling would confirm the remaining funding for Gateway Plus. This came as concerns were raised that the government would refuse to provide the remaining tranches of funding. However, Alastair Darling failed to mention the project in his Pre-Budget Speech to the House of Commons, instead mentioning the Crossrail project for the South East of England, provoking fury among business leaders who accused Prime Minister Gordon Brown of dithering. Rod Ackrill, President of the Birmingham Chamber of Commerce and group chairman of developer Chase Midland, demanded the government to provide the necessary funding for the project and said he expected a decision by Christmas Day, 2007.

On 12 February 2008, Ruth Kelly announced that the Department for Transport will be providing £160 million on top of the £128 million that is to be provided through the railway White Paper. A further £100 million will be provided by the Department for Business Enterprise and Regulatory Reform and will be channelled through Advantage West Midlands, the regional development agency. The announcement brought the total amount of Government spending on the project to £388 million.

In total, £100 million will be given by Advantage West Midlands, £288 million from the Department of Transport, £100 million from the Department for Business Enterprise and Regulatory Reform, £128 million from Network Rail and £10 million from Centro. There will be additional funding from the private sector. Network Rail is also investing £350 million in renewing the signalling systems through New Street station and the West Midlands over the next ten years.

The Chancellor George Osborne confirmed in his June 2010 budget that central government funding for the redevelopment would still be provided despite the economic downturn.