Budget 2014: £270m guarantee for Mersey Gateway

The Chancellor approved a £270m guarantee to support the Mersey Gateway Bridge, taking the £600m project a step further towards completing the deal with contractors to build and run the second crossing between Widnes and Runcorn.

The team behind the Mersey Gateway project, led by Halton Council, said in a statement: "The announcement from the Chancellor that the government has confirmed a £270m guarantee to support the project is great news.

"The Government is now guaranteeing around 50% of the senior debt required to finance the project with the remainder being provided by the project finance market. This decision clears the way for financial close and we expect to achieve this in the very near future. Once we have completed this, more details of the financial arrangements and funding will be confirmed and announced.

"Preparations are taking place to allow construction work to commence in the coming weeks."

The Budget report said that: "Work can now begin on this critical infrastructure project which will help relieve traffic congestion across the Mersey and promote regeneration in the area."

Expected to carry 80,000 vehicles a day, the six-lane toll bridge will span the Mersey between the towns of Runcorn and Widnes and relieve congestion on the ageing Silver Jubilee Bridge.

The Merseylink consortium, which includes Kier, FCC, Bilfinger, Samsung CT and Macquarie, was awarded the contract to design, build, finance, maintain and operate the bridge in June 2013.

Construction is expected to last three-and-a-half years, with the bridge initially scheduled to be opened to traffic in the first half of 2017.

In 2012 the government introduced the UK Guarantees scheme, to avoid delays to investment in UK infrastructure projects by providing a government backed guarantee to investors.