REQUEST FOR MAYORAL DECISION MD727

Title: East London Cable Car

Executive Summary:
The cable car project is being developed in collaboration with Transport for London (TfL) to create a fixed
connection between the Royal Docks and the Greenwich peninsula. This will be a transport investment as
well as a significant leisure destination. The cable car fits clearly within the Green Enterprise District and
Royal Docks strategies. It is a significant infrastructure improvement to the area, and will strengthen the
regeneration of the Royal Docks as well as the Greenwich peninsula. It will facilitate the creation of a
connected Thames Gateway business, leisure and residential community.
The cable car will be an important piece of infrastructure complementary to the Olympic Legacy
programme, building on the attractiveness of London as a destination beyond the Games themselves.
This planning phase will allow the London Development Agency (LDA), working jointly with TfL, to
develop the project through the enabling stages, to the point that consents are in place together with a
land and commercial strategy and option agreements to acquire the necessary interests. TfL will lead on
the procurement of a design and build contractor and the establishment of a concession for longer-term
operation.
As the LDA Board is focusing on the orderly winding down of the Agency and the project will be delivered
by GLA Group beyond the life of the LDA, it is proposed that the Mayor directs the LDA to fund up to
1.213m in respect of obtaining the necessary consents, developing a delivery mechanism and enabling a
land acquisition strategy to be implemented.

Decision:
The Mayor is requested to direct the LDA to fund up to 1.213m in 2010/11 towards the development
phase of the East London Cable Car project in respect of obtaining the necessary consents, developing a
delivery mechanism and enabling a land acquisition strategy to be implemented.

Mayor of London
The above request has my approval.
Signature

PAC Dec 2010

Date

PART I - NON-CONFIDENTIAL FACTS AND ADVICE TO THE MAYOR

Decision required supporting report
1.

Introduction and background

The cable car project is being developed in collaboration with TfL to create a fixed connection
between the Royal Docks and the Greenwich peninsula. This will be a transport investment as well as
a significant leisure destination. The cable car fits clearly within the Green Enterprise District and
Royal Docks strategies.
It is a significant infrastructure improvement to the area, and will strengthen the regeneration of the
Royal Docks as well as the Greenwich peninsula. It will facilitate the creation of a connected Thames
Gateway business, leisure and residential community. The project will in particular:
improve connectivity for pedestrians and cyclists, creating better resilience for the Thames
Gateway transport networks, together with shorter journey times between North and South
London.
connect two key regeneration areas: the Greenwich peninsula and the Royal Docks. These
already have successful anchors in the shape of ExCel and the O2, but further huge
potential which this will help unlock.
support the leisure and visitor economy outside Central London, becoming a visitor
attraction in its own right, which allows tourists and visitors to cross 90 metres above the
Thames.
consolidate the attractiveness of the Royal Docks for inward investors .
Compared with alternative crossing infrastructure, this is relatively cheap to build, offering a capacity
of up to 2,500 people per hour in 34 ten-person gondolas on a continuous loop (1 million journeys
per annum). It has a low energy use and promotes a more sustainable form of public transport, as
well as an affordable one (with fares being envisaged around 2 to 3.50 per journey, and available
on Oystercard). Other cities such as Lisbon or Barcelona have adopted cable cars as a means to
efficiently tackle urban connections.
As a part of the public transport network, it would provide benefits to people living and working in
the surrounding area. It would improve the connectivity of the two locations to pedestrians and
cyclists; reduce the transit time between the Greenwich Peninsula and the Royal Docks (at present
22 minutes on the Jubilee Line and Docklands Light Railways, and anticipated to be just 7 minutes
by cable car); and improve the resilience of public transport in the area (which is very reliant on the
Jubilee Line and DLR).
This should all increase the attractiveness of the area as a place to live and work, positively
impacting on land values and the regeneration of the area.
In addition to this, it is likely that the cable car would be a visitor attraction in its own right,
supporting the leisure and visitor economy in east London and complementing existing
developments such as the O2; Excel; Olympic Park and Greenwich. As a result, the cable car has the
potential to increase the amount of retained tourism in the area and the level of tourism related
employment in the area further aiding the regeneration of the area.
The LDA budget to obtain necessary planning consents, develop a delivery mechanism and enable
the land strategy acquisition to be implemented has been estimated at 1.213m for 2010-11.
A paper was presented to the LDA Investment Committee of the 2 November 2010 to approve this
budget. The Committee asked for a further report which would set out the funding options for the
full implementation of the project together with further information on its commercial viability. The

PAC Dec 2010

Committee agreed that if timetable was an issue, this decision might be addressed through a
resolution in writing rather than a further Committee meeting.
Some of the information requested by the LDA Investment Committee will in fact be enabled by the
funding to be approved in this Mayoral Decision, such as the development of the demand forecasts,
and the further assessment of the commercial case, funding and sponsorship options. Ultimately,
commercial viability can only be tested through market response to the project as a commercial
concession opportunity. As the project is a joint LDA-TfL project which will be delivered over 201012, and the LDA Board is focusing on the orderly winding down of the LDA, it is considered
appropriate that the Mayor should direct the LDA to pursue the planning phase of the project.
The LDA Investment Committee will receive a further paper on the project at a future meeting.
Planning consent is expected to be decided by the end of February 2011, with land and rights
secured the following month.
Because of the projects dual transport and regeneration role, it is considered appropriate for LDA
and TfL to be working jointly on this project, with, in particular, the LDA focusing on the land and
rights acquisition strategy, while TfL progresses the design and delivery model.
The land required for the cable car landing stations and columns is relatively small but held by a
number of parties (including the HCA and Greenwich Peninsula Regeneration Ltd on the south side).
The LDA itself is one of the larger land owners in the Royal Docks area, but up to another 20 sites
are affected. In addition, the Greenwich Peninsula Masterplan will require amendments.
The LDA will seek to secure the ability to acquire land and rights at its cost on the basis that the vast
majority of the interests are within overall control or influence of the Mayor, GLA Group or other
public agencies (but there are a small number of private interests which will have to be secured
through negotiation). The intention remains to acquire all land and rights at minimal cost within the
1.213m but should any compensation be required these acquisitions would be subject to further
approvals and funding by the LDA.
The proposed Mayoral Direction allows the LDA to fund the works associated with the securing of
the planning permission and linked preparatory work.
Further details on this phase of the project are set out in the LDA Investment Committee 2
November paper attached in Annex 1.
2.

Issues for consideration

a)

Links to strategies and Strategic Plan

The Cable Car project supports the Mayors ambition for the Thames Gateway as set out in the
London Plan and the Economic Development Strategy. The EDS in particular identifies the need to
seize the unique regeneration opportunity offered by the 2012 Olympic and Paralympic Games and
continue to provide a strong foundation on which to build the continued economic growth and
regeneration of East London.
The Mayors Transport Strategy sets out (Paragraph 392) support for improvements for pedestrians
and cyclists whether in the form of new passenger ferries or innovative solutions such as cable
cars.

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Proposal 39 of the Transport Strategy further identifies the proposals to be taken forward by the
Mayor for improving river crossings in East London.
b)

Impact assessments and Consultation

Extensive public consultation has already taken place about the cable car. In particular a four-week
local consultation took place in August 2010 to which over 1000 responses were received (which
included 39% Newham residents and 26% Greenwich residents). Responses were very supportive
with 89% agreeing that it would be an exciting new feature for London, 87% agreeing that it would
provide a great way to get across the River, and 85% a valuable addition to the transport options
available, particularly when large events are on.
78% of respondents agreed that it would support the economy in the area, and 76% that it would
bring jobs and tourists.
As per the statutory requirement, the LDA has been consulted on this proposed Direction and its
comments have been addressed where appropriate.

c)

Risk
Because the delivery timetable of the project is ambitious, there is a risk of some slippage. This
direction seeks to mitigate this by allowing the LDA to further progress the development phase
without delay.

3.

Financial Comments

3.1

The Mayor is asked to direct the LDA to fund 1.213m in 2010-11 towards the development phase
of the East London Cable Car project in respect of obtaining the necessary consents, developing a
delivery mechanism and enabling a land acquisition strategy to be implemented.

3.2

There are no direct financial implications to the GLA for this proposal. The costs to enable the
project to the procurement and delivery stages and to be borne by the LDA are estimated at up to
1,213,000 and are as follows:

Planning and associated consents to include funding of professional fees in support of

consents stage: 500,000 (in capped contribution to TfL)
Initial land referencing and strategic advice on acquisitions: 25,000
Legal fees in support of land strategy and commercial development of the scheme: 180,000
Shared costs with Greenwich Peninsula Regeneration Ltd for planning application: 75,000
Support of acquisition process and property consultancy fees: 120,000
3rd party legal fees for current landowners: 120,000
Design development resulting from masterplanning changes: 100,000
Sponsorship strategy: 75,000
Support of business development process: 18,000

3.3

This funding will support the preparation and submission of a detailed planning application and
enable a land acquisition strategy to be progressed to complete option agreements to secure leases
and associated permanent and temporary licences for land and rights to build and operate the cable
car.

3.4

With regard to the 1.213m budget requirement, the LDA is to ensure that this is funded within its
overall 2010-11 budget.

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3.5

It should be noted that the LDA is currently focusing on its orderly winding down and the next
phase of the project will be delivered by the GLA Group beyond the life of the LDA (as noted within
the Executive Summary of this Mayoral Decision). The next phase of the project will be subject to
further approval.

3.6

The development phase of this project will be managed jointly by the LDA and TfL. The GLAs
Economic & Business Policy Unit will be responsible for overseeing the GLAs activities relating to
this proposal.

4.

Legal Comments
Under section 4(1) of the Regional Development Agencies Act 1998 (the Act), one of the statutory
purposes of the LDA is to further the economic development and regeneration of its area. Under
section 5(1) of the Act, the LDA may do anything which it considers expedient for its purposes or for
purposes incidental thereto.
Under section 27(1) (b) of the Act the Mayor may give the LDA a direction in relation to the
exercise of its functions. Development of the East London Cable Car is intended to further the
economic development and regeneration of part of Greater London. Accordingly, the proposal to
direct the LDA to contribute directly 1.213m to the East London Cable Car project would be
permissible under section 27(1) (b) of the Act. Under section 40(1) of the Act, the power to give a
direction under section 27(1)(b) is only exercisable after consultation with the LDA. It is confirmed
above (at 2(b)) that such consultation has taken place.

5.

Background/supporting papers
Annex 1: East Thames Cable Car, LDA Investment Committee paper 2 November 2010
Annex 2: Mayoral Direction

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Public access to information

Information in this form is subject to the Freedom of Information Act 2000 (FOI Act) and other legislation.
Part 1 of this form will be made available on the GLA website within 1 working day of approval. Any facts
and advice that should not be made automatically available on request should not be included in Part 1 but
instead on the separate Part 2 form. Deferment is only applicable where release before that date would
compromise the implementation of the decision being approved.
Is the publication of this approval to be deferred? NO
If yes, for what reason:
Until what date:
Is there a part 2 form - NO
ORIGINATING OFFICER DECLARATION:
Tick to indicate
approval (9)
Sponsoring Director:
Jeff Jacobs has reviewed the request and is satisfied it is correct and consistent with
the Mayors plans and priorities.

Mayoral Adviser:
Sir Simon Milton has been consulted about the proposal and agrees the
recommendations.

Legal Advice:
The Public Law team have commented on this proposal.

Financial Advice:
The C&I finance team have commented on this proposal on behalf of the Assistant
Director of GLA Finance.

OFFICER APPROVAL
Executive Director, Resources
I have been consulted about the proposal and confirm that financial and legal advice have been taken into
account in the preparation of this report.
Signature

Date

Chief of Staff
I am satisfied that this is an appropriate request to be submitted to the Mayor
Signature

PAC Dec 2010

Date