I wish to update the House on Crossrail progress since my annual update on 15 July 2010, Official Report, columns 43-44WS, in which I undertook to report later in the year on progress made by Crossrail Ltd on their value-for-money programme.

The spending review announcement confirmed Government’s joint commitment with the Mayor of London to delivering Crossrail, and secured the funding to deliver the scheme to its original scope.

As I indicated in July, Crossrail Ltd has been undertaking a programme of value engineering, risk avoidance and mitigation, alongside indirect cost reduction to ensure that the scheme is delivered in the most efficient way possible. In line with this approach, the Government accepted an engineering-led solution to delivering the central section which has enabled substantial savings of around £1 billion to the Crossrail funding package to be identified. While the construction programme for the central section will be lengthened by around a year, this has enabled the Government to confirm that funding is available for the whole project.

We now expect that Crossrail services will commence from 2018. However, the detailed timetable for the phased introduction of Crossrail services requires additional work in a number of areas. For example, further work needs to take place on:

(i) the transfer of services from existing franchises to the future Crossrail operations; and

(ii) the development of detailed plans on the commissioning of services.

It should be noted that Crossrail services were always planned to be phased into operation over some months and it remains a priority for the Government to ensure services are commissioned in the most efficient possible way.

In addition, I wish to inform the House that Crossrail Ltd has issued its notice of intention to award the tunnelling contracts for the central section tunnels. These contracts mark a further milestone in Crossrail’s progress towards the start of tunnelling in late 2011.

Crossrail Ltd continues to work to achieve further savings in advance of the final review point for the project in spring next year. I expect to make a further update on progress then.