Govt goes cool on ‘Chunnel’

Press, 28 February 1980, Page 9

Govt goes cool on ‘Chunnel’

NZPA London The on-again, off-again project to build a tunnel under the English Channel now looks like losing the support of the British Government. After months of intense optimism that a single-track rail tunnel, substantially backed by European Economic Community funds, would, go ahead, the project seems likely to be dropped by the Government. A

The authoritative “Financial Times” has reported that British Government aid for the rail “Chunnel” was seen as most unlikely. The kiss of death for the proposal, the latest in a long line, would be delivered after the summer parliamentary break after an interim statement to the Commons next month. The paper said British Ministers had been told the joint British Rail-S.N.C.F. (the French railway) project

was unlikely to achieve the If per cent return on capital forecast by the partners. The likelihood of the cost of the tunnel coming close .to the estimated $1514.5 million is also considered small. According to the “Financial Times,” the Transport Minister (Mr Norman Fowler) has no set view of- the Chunnel project, other than that it should not be supported by Government funds. ' .

Up to 20 per cent of the total cost could come from the E.E.C., but the Government fears it could be asked to foot the whole British share of the project — 50 per cent. The European Commission has been pushing hard for a Chunnel as part of a big improvement of Europe’s transport system, and officials have expressed open concern that the British attitude could lead to the pro jects being dropped.