Extension of the Northern Line towards Battersea Power Station will be progressed with a £1Bn loan guaranteed by Government. In his Autumn Statement the Chancellor promised the Greater London Authority a favourable borrowing rate to allow the rail link to be built.

Mr Osborne said the Northern Line extension would support development at Battersea “on a similar scale to the Olympic Park”. Track laying would serve two new stations including one at Nine Elms beside the Wandsworth Road.

The Chancellor is confident that Government intervention will encourage investment worth £8Bn at the disused power station site, creating up to 25,000 jobs and around 16,000 new homes.

Mayor of London Boris Johnson welcomed the loan to kickstart the Northern Line extension. “It will be an incredible confidence boost for developers preparing to invest there and it will also be of considerable benefit for local people using the new Tube link,” he said.

The Mayor’s office added that the new Northern Line stations could cut journey times to the West End and the City to around 15 minutes and reduce pressure on nearby Vauxhall station. Construction of the extension is likely to begin in 2015 and could be open in 2020.

The Chancellor also said in his Autumn Statement that plans to take the High Speed 2 rail route to the North West of England and West Yorkshire will be set out by the Transport Secretary in the New Year.

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