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Business leaders have been insistent that Crossrail was not an option but a necessity. Unusually, they have even been prepared to promise to commit some cash to the project. That has helped to prise some money out of The Treasury, although Gordon Brown has only been prepared to come up with £2 billion of the estimated £10 billion cost. An increase in the London business rate is likely to be used to help to fund the project, and employers are generally not thought to be averse to this although their final reaction will depend on the level.

But there will be a funding gap and this is where Mr Montague’s expertise on PFI will come into play. While the Government pushes through the Bill that will get Crossrail rolling, he will be looking at what sort of a vehicle might best deliver such an important project for the capital. With such a high level of business interest, he will have no shortage of advisers. He will also have on hand Ken Livingstone, Mayor of London, who is in a pivotal position to bring Crossrail to reality.

It may be that the bond issue with which Livingstone was so keen to finance the improvement of the London Underground, and which the Chancellor of the Exchequer so vehemently opposed, will now help to fund Crossrail.

Putin’s Yukos war is harming investors

THE risk factor in doing business with Russia moved up several notches yesterday. President Vladimir Putin may merely be intending to use Yukos to demonstrate that he will brook no interference from the oligarchs, but the message that he sent out yesterday will be seen as going very much further. Foreigners already involved in Russia will cross their fingers a little tighter; those who are not will be more reluctant to venture there.

The Government’s grabbing of assets worth many times the value of an alleged outstanding tax bill does not merely affect Putin’s enemy, Mikhail Khodorkovsky, for there are minority shareholders who are now being robbed of their assets. Those oil assets will now be bought at a knock-down price by the state, or people not unknown to Mr Putin. An open market auction is not on the cards.

Those who had hoped that Putin might be able to resolve his dispute without frightening friendly investors will be disappointed by yesterday’s developments. The show trial that has been dragging on against the Yukos boss is unedifying but its implications for the country’s economy might have been contained.

It was personal. But now that personal battle has spilt over into an attack on assets, some owners of which come from outside Russia.

Coming just days after Putin had instructed his ambassadors to improve his country’s image abroad, it does not look like a constructive move.

WATCHING Premier Foods struggle to get just 4p above its 215p issue price, Virgin Mobile finally opted to price its own issue at the very bottom of the range. Launching at £2 when the bankers had originally dared to set the top of the range at 285p must strike even Sir Richard Branson as something of an indignity. It will do nothing to enhance the jaundiced view of the City, which persuaded him to cut short his late involvement with the LSE. But the feeling appears to be mutual.

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