London will deliver the major transport scheme using Transport for London (TfL) and Greater London Authority (GLA) borrowing, with most of the funding provided by the two bodies.
The government will also contribute over the long term.
The budget reads: “The government will continue to work with London to finalise funding details and will continue to work with the GLA to look at options for innovative financing to support the delivery of infrastructure projects in the capital.”
The DLR extension is just one of several measures announced in the Autumn Budget today (November 23).
The Chancellor, Rachel Reeves, also announced a budget focused on delivering change to cut NHS waiting lists, debt and borrowing, and the cost of living.
Thamesmead is currently the only London postcode without a direct rail service, and the extension of the DLR is expected to significantly improve transport links in the area.
The project, which has been long supported by the council, has also been backed by the Mayor of London, Transport for London, and key partners including Newham Council, Peabody, and Lendlease.
The Chancellor said she was determined to double down on the decisive action to grow the economy and create good jobs.
This includes increasing public investment by over £120 billion over the Parliament, creating the National Wealth Fund, which has already invested £3.8 billion, and supporting the expansion of Heathrow and Gatwick airports, plus the construction of Sizewell C.
There will also be further investment in the Lower Thames Crossing and a drive to bring £4 billion of investment into the stock market.
The Royal Borough of Greenwich is set to continue working closely with the Government and its partners to maintain momentum on the DLR extension project.
Councillor Anthony Okereke, leader of the Royal Borough of Greenwich, said: “In June’s Spending Review, the Government acknowledged the potential growth and housing benefits of extending the Docklands Light Railway (DLR) to Thamesmead.
“We’re delighted to see this enthusiasm translate into real action, with the funding commitment to this vital project for our borough.”
Councillor Majid Rahman, cabinet member for planning, estate renewal and regeneration, said: “Extending the DLR to Thamesmead will further underline its potential as one of the largest regeneration areas in London, with a focus on homes, jobs, schools, culture, and green spaces.”
The government has already recognised Thamesmead’s enormous potential by shortlisting it as one of 12 possible new towns.
Councillor Rahman added: “Following the success of the Elizabeth Line and its impact on our own work to regenerate Woolwich, we can’t wait to get started on this exciting new chapter for Thamesmead.”
Councillor Okereke said: “We look forward to carefully scrutinising the funding commitment once the full details emerge.”
