Ministry makes downward adjustment to budget of planned Espoo extension of Helsinki Metro

print this

The Finnish Ministry of Transport and Communications has made a downward adjustment to the budget of the planned Espoo extension of the Helsinki Metro. The current cost estimate for the project is EUR 713 million.
     
The original budget was EUR 452 million, which soon climbed up to EUR 800 million, whereupon the 30 per cent subsidy promised by the state was in jeopardy.
      Petri Jalasto, a senior official at the Ministry, says that the savings have been achieved by shortening the platforms from 130 metres to 90 metres.
      As a result, the number of entrances to the stations could also be reduced.
      Olavi Louko, the Director of the City of Espoo Technicall Department, denies that the content of the project has been changed. According to him, the Ministry first wanted to hear a lump sum which would include also a potential rise in costs. The lump sum given was EUR 800 million.
     
The new sum of EUR 713 million was calculated on the basis of the October 2007 price level and index-linked.
      Louko notes further that the savings proposed by the Ministry were included already in the estimate of EUR 800 million.
      ”Without these adjustments, the price would have risen to EUR 900 million”, Louko claims.
      Louko says that he approved the amendment reluctantly, as he fears that the state could ”easily forget the index linkage”.
     
It is possible that the goal of the state is to set the initial price as low as possible in order that it could answer for its 30 per cent share, Louko suspects.
      The participation of the state in the Metro project will be settled during the government’s budget talks next week, when the individual budgets of each ministry will be discussed.
     
The Espoo City Council's decision to vote in favour of the extension of the Helsinki Metro system was subject to the 30 per cent state aid clause, regardless of the total costs of the project.
      Should the state reduce the amount of the subsidy, Espoo would have to reconsider the entire Metro question.


Previously in HS International Edition:
  Despite extension of Helsinki Metro, Espoo traffic is likely to increase by 20 per cent by 2015 (28.2.2008)
  Espoo extension of Helsinki Metro could still hinge on state subsidy (18.2.2008)
  Espoo City Council votes in favour of extension of Helsinki Metro (26.9.2006)

Links:
  MInistry of Transport and Communications

Helsingin Sanomat