TONY BLAIR today defended the government's decision to scrap the "Big Bang" expansion of the Metrolink tram service in Manchester because of its escalating cost.

In an exclusive interview with the Manchester Evening News shortly after Transport Secretary Alistair Darling told MPs the cherished scheme was too expensive, the Prime Minister said the government had to "cut the cloth according to our needs".

He said: "The problem has been that there has been a very sharp escalation of cost that we need to find a way of dealing with," said Mr Blair, speaking in the Cabinet room at 10 Downing Street.

"So what Alistair is saying is that the original sum of money we said we'd spend on this we're prepared to commit, but what we cannot do is commit without finding out how we'll finance additional sums of money.

Discussions

"I'm well aware of the importance of Metrolink in Manchester, but there has got to be a method of financing it - and for London that's true of the Crossrail plan as well."

The Prime Minister added: "My understanding when I was looking at this is that the cost is the issue.

"What we can't do is extend the overall budget of the Department of Transport, but what we can do is continue discussions with local civic leaders and business people and others to find out how we can make sure what the people of Manchester want happens without us going over the limits we have already set ourselves.

"Light rail has been a success, but in the end we've got to cut the cloth according to our needs.

"We set aside a significant sum of money for this but we have got to make sure it's going to be done in a way we can afford."