Wow, this subject is still going round in circles.
I think there are some common misconceptions about the funding of these large projects. Let me give you an example.
Heathrow built a tunnel fairly recently to transfer baggage from T5 to the new T2 and T3. As is the way with tunnels this was not cheap but being inside the airport perimeter was funded by BAA.
One of the large costs in any tunnelling project is the cost of the tunnel boring machine (TBM). This was manufactured by a company in Doncaster and would have provided an income for many workers who then took it back home with them where it was probably spent in local shops, pubs restaurants etc. This project also provided a profit for a northern based business.
The tunnellers came from all over the country as well as some from abroad. I cannot remember a single one that actually lived within the M25. They all earn't very good money and took it back home with them where it was probably spent in local shops, pubs restaurants etc.
Another large cost is the tunnelling segmental lining. This was manufactured by a company in Derbyshire and delivered by road using a haulage company from the north also. This would have provided an income to the northern based workers who then took the money home to spend on .........
The project also consisted of plant hire, concrete finishing, excavations, employment agencies plus many other trades and services, to much to mention here but I cannot think of many that came from within the M25.
I then worked on Crossrail. Pretty much the same happened there with the exception of the TBM's being from Germany. They were still driven by people from all over the UK and Ireland though and the project being a lot bigger employed many more workers from the regions and put a lot of money out into the local economies.
It is easy when looking at these huge figures to think it is just disappearing from the government coffers to benefit the capital but it is truly filtering back into the economy throughout the whole country. One of the main costs is wages. Straight away part of that comes back in taxes. Companies around the whole of the UK benefit as suppliers and we end up with a new piece of infrastructure and most of the money back into our economy. This is why countries like to build during a recession.
If we get finance from a foreign nation then we get the infrastructure built, the money into the economy and can then pay it back out of the income generated from the new asset. It is a win win situation. The only caveat is that the proposed project has to be a solid investment opportunity that has the ability to generate the cash to pay back the loan and any interest.