The Mersey Gateway Project will cost £1.86bn over its 30-year time period (2014-2044). This figure is based on the figures agreed by all parties in the contracts awarded to the Merseylink consortium in March 2014 and reflects the £250m saved by Halton Borough Council and Merseylink through the innovative procurement process.
To meet these costs, the funding arrangements between the UK Government and Halton Borough Council were agreed on the basis that users of the Mersey Gateway and the Silver Jubilee bridges will contribute the majority of funding through the payment of tolls.
In addition to the revenue from users, the Department for Transport provides grant funding for the project every year, £100m from 2017 to 2024. Without this subsidy from Government, the project would make a significant annual loss.
When the contracts were signed, Halton Borough Council entered into a Public Private Partnership with the Merseylink consortium.
Once 2044 is reached, Halton Borough Council would, in principle, support the removing of tolls on the Mersey Gateway Bridge and the Silver Jubilee Bridge, providing all outstanding financial matters relating to the two bridges have been met.
However, any decision would also require a commitment from the Government of the day to meet the annual repairs and maintenance costs from the National Roads Budget, as even after the bridges are paid for, there would be an annual maintenance and repairs budget of several million pounds that would need to be funded appropriately.
This page sets out more details of the project’s finances:
Income and expenditure summary – October 2024
The Mersey Gateway Crossings Board has published an Income and expenditure summary outlining annual revenue and project costs, together with the funding received from UK government since the Mersey Gateway Bridge opened in October 2017 through to March 2024.
The summary shows the importance of government funding to the project and details the sums that have been provided by and returned to government over this time period. Moving forward, an Income and Expenditure Summary will be published on an annual basis.
You can also view the quarterly dashboards produced by merseyflow which detail traffic numbers, PCN numbers and project revenues generated by toll income.
Government funding grants (2017 – 2023)
In line with the Funding Letter and following the review of project income and expenditure from October 2017 to March 2023, the unused element of grant funding was returned to the Department for Transport (DfT) in October 2024.
The reason for repaying unused grants to the DfT is that Halton Borough Council receives funding in advance based on an agreed estimate. Once the actual revenue and expenditure is known each financial year, the amount of government grant that is required is then calculated, and any unused grant is then returned to the DfT at the relevant review period.
The majority of project funding moving forward will continue to come from toll charges paid by people who use the bridges, and the Department for Transport will continue to provide substantial grant funding for the project every year. Without this subsidy from Government, the project would make a significant annual loss.
- In total, the DfT has provided operating grants of £138 million to the project during the review period.
- £85.35 million of this DfT grant was used to help fund the project.
- As a result, £44.75 million, representing 85% of the unused grant, has now been returned to the DfT
- In accordance with prior formal DfT agreement, the remaining 15% of unused grant support (£7.9 million) has been retained by Halton Council to contribute towards the operation, maintenance and improvement of the Silver Jubilee Bridge and any public transport initiatives of the Council’s Local Transport Plan.
Moving forward, the Department for Transport will continue to provide funding for the project on an annual basis – this will amount to a further £67million over the next three financial years from April 2024.
Returning unused grant in this way was a possible outcome of the Mersey Gateway funding structure. It means that this public money which has been saved on the project can be used in other ways by the Department for Transport and Halton Borough Council.
This is in line with the original project funding plan agreed by the Department for Transport and Halton Borough Council. It stipulated that 85% of any unused grant would be returned to the Department for Transport, with the remaining 15% being retained by Halton Borough Council. It was structured in this way to ensure effective management of the project.
Moving forward, a similar review and return of any unused grant funds will be conducted every three years.
Our Second Review Point report sent to the Department for Transport in September 2023 summarises the position at that time.
Contractual Arrangements
The Project Company (Merseylink)
Merseylink has the formal responsibility for the design, build, finance, operation and maintenance of the new bridge and associated road infrastructure over a thirty-year period from 2014 to 2044.
It is also responsible for the provision of tolling equipment on both the new bridge and the existing Silver Jubilee Bridge and a journey time measurement system on the new bridge and road infrastructure.
To be able to meet these costs, Merseylink has put in place a financial arrangement which consists of bank loans, a Council loan and funding through a bond investment supported by the HM Treasury’s UK Guarantees Scheme. To deliver this finance, it has been necessary for Merseylink to secure equity investment.
The Council does not pay Merseylink for any of the costs explained above (such as construction cost) but instead it is required to pay Merseylink an annual fee from October 2017, when the Mersey Gateway Bridge opened to users.
This fee, called the unitary charge, is linked to Merseylink’s performance against the service requirements as set out in the contract. For example, Merseylink is required to operate the project road so that the average speed of users does not drop below an agreed level. If the average speed does drop below this minimum, then the unitary charge could be reduced.
The Council will pay this charge up until 2044, when the project is handed back (to the Council) in a good condition and with all the private finance repaid.
The Demand Management Participation Agreement Company (Emovis)
In addition to the Project Agreement with Merseylink, the Council entered into a Demand Management Participation Agreement (DMPA) with Emovis, who are responsible for the collection of toll charges and enforcement of unpaid tolls.
It does this under the merseyflow brand, which is the public facing tolling brand and website where customers register for discounted crossings and monthly passes or pay for one-off journeys.
The Council pays an annual fee to Emovis for the delivery of the DMPA service. An element of this fee is performance related, so if Emovis customer service and other related Key Performance Indicators do not meet the required standards then this part of the fee is deducted by the Council.
If use of the crossings is higher than anticipated and all KPIs are met, Emovis receives a share of the additional revenue above a set breakeven point.