One of Britain's largest regeneration projects may have to be scaled down because it is unclear who will pay for road construction.
The £1bn Newham Arc of Opportunity, a 5000-home mixed-use project in east London, requires a 2.5 km PFI road to link six parcels of land between Stratford and the Lower Lea Valley. But there is confusion over whether the DTLR or Transport for London is to pay for it.

Advisers say the DTLR does not have sufficient PFI road-building funds for regeneration projects in London. TfL is also unlikely to have the funds to cover the Newham Arc, as its transport budget would be eaten away by the £90m north-south London spine road.

David Lock, an executive at PFI consultant 4Ps and an adviser on the scheme, said TfL, the Greater London Authority and the DTLR were discussing the question.

He added: "The problem the scheme has hit is that the GLA hasn't got enough money [to fund the road]."

Project sources believe that without a road, some of the 5000 homes could be at risk. The road is seen as vital to create a new urban quarter in London as it would link up the six areas involved.

A DTLR source said it would apply for extra PFI credits in next year's departmental spending review to help fund road-building projects in London.

Newham council claimed the confusion would not affect the long-term future of the project. Its head of environmental engineering, John Herman, said the project was unlikely to be delayed. Herman added that Arup's transport consultancy will shortly be commissioned to draw up an assessment of the road scheme. The council is also in talks with British Waterways to include a canal in the project.

An international station at Stratford is under construction.