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Crossrail 2 was given the go-ahead by an independent body today, paving the way for construction of the vital north-south railway across London.

Ministers were urged to press ahead with the £27 billion link “as a priority” by the national infrastructure commission, set up by Chancellor George Osborne last year.

The commission’s chairman Lord Adonis warned that the capital would “grind to a halt” unless major improvements were made to the transport network.

Crossrail 2 would link the suburban railway network from Wimbledon to Tottenham Hale via a new tunnel under the city’s centre.

It is hoped the cross-capital route could be in operation by 2033 and Lord Adonis, in his long-awaited report, called on the Chancellor to allocate funds immediately to develop the plans.

Mr Osborne, said to be supportive of the epic project, is expected to give his response in the Budget next week.

Supporters say the new link would give London’s economy a multi-billion-pound boost and support 200,000 new homes as well as 200,000 new jobs.

The proposed route will stretch further on to stations in Surrey, including Shepperton and Epsom, as well as Broxbourne in Hertfordshire — and will free up main-line rail routes into Waterloo and Liverpool Street terminals, meaning faster and more frequent journeys into London.

About £160 million is needed to take the project to its next stage, with Transport for London expected to make a “reasonable” contribution. However, Lord Adonis, a former Labour transport secretary, warned that the costs of the scheme were currently too high and a new business case was needed.

London will face severe overcrowding on the Tube by the 2020s with a lack of capacity on overground rail services and at stations including Waterloo, Victoria and Clapham Junction — some of the busiest in the UK.

Lord Adonis told the Standard: “By the 2030s London will be a mega-city of more than 10 million people. Even allowing for planned investment and the imminent arrival of Crossrail 1, it will grind to a halt unless significant further improvements are made.

“That’s why London needs Crossrail 2 as quickly as possible. It would help to relieve severe overcrowding across some of the busiest Network Rail stations in the country and on the most congested Underground lines and overground commuter routes.

“There is no good reason to delay. Crossrail 2 will help to keep London moving, create hundreds of thousands of homes and fire regeneration across the city from north-east to south-west.

“We should get on with it right away and have the line open by 2033.”

His commission said the business case for the railway should be rewritten to make sure London contributed its fair share — more than half of the overall cost.

The report, Transport For A World City, suggested looking again at the costs and benefits of individual stations in central London. Chelsea residents have led a campaign against a station in King’s Road.

Lord Adonis said the Treasury would recoup a significant proportion of its investment through the economic boost the scheme provided.

The next mayor should also look at other major projects including East London river crossings and the extension of the Bakerloo line, he added.

Boris Johnson, who has said each year of delay could cost London’s economy £8 billion, called the report a “huge vote of confidence” in TfL’s plans and confirmed Crossrail 2 was of “national significance”.

Crossrail 2 managing director Michèle Dix said: “The report is clear that Crossrail 2 is an essential response to the challenges the region faces.

"We now hope that the Chancellor commits the development funding and legislative time the Commission recommend.”

The Treasury said: “This new report is an important contribution to how our capital can continue to thrive.”

The £15 billion Crossrail 1 scheme, named the Elizabeth line in honour of the Queen, will start running through central London in December 2018.

It will eventually operate from Reading through Ealing Broadway, Tottenham Court Road and Liverpool Street before travelling on through Essex.

Two further spurs will connect commuters with Heathrow and, to the east, Canary Wharf and Abbey Wood.