'London Underground £1.5 billion funding black hole revealed'

Date: 18/12/2009

A funding gap of £1.5 billion has emerged on planned London Underground upgrade work, it has been reported.

An independent arbiter has estimated the work should cost around £4.4 billion to complete, £1.35 billion less than that the estimate by Tube Lines, which is carrying out the work.

It has been suggested that tax payers may have to plug the gap to finance the work, with consumer watchdogs warning of potential fare increases.

Fares are already set to rise next month by up to 20 per cent.

Tube Lines chief executive Dean Finch stated: "LU [London Underground, a subsidiary of Transport for London] has a stark choice to make - either to do less work or raise additional finance."

The news follows warnings earlier this week that improvement works planned next year on the Northern Line could be delayed as Jubilee Line works are running behind deadline.