Costs have risen since the scheme was approved in 2002

The Merseytram scheme faces the axe after Transport Secretary Alistair Darling said he would not stump up extra cash to meet rising costs.

He said the government had originally agreed to pay �170m in 2002 but was now being asked to find �238m.

But project leaders have questioned his figures, saying they did not take account of rising prices and inflation.

They say steel prices have risen by 40% and construction costs by 20% since the scheme was agreed in 2002.

The government accepted DLR (Docklands Light Railway) were allowed to do this but not us Merseytravel

The delegation from Merseytravel - the passenger transport authority - met Merseyside MPs and was hoping to meet Deputy Prime Minister John Prescott.

Chief Executive Neil Scales said he was "seeking clarification" of the government's figures.

It included Mr Darling's refusal to allow Merseytravel to take out a leaseback on the building stock and claim tax relief on �30m which it wanted to be paid upfront.

"We're doing exactly what the Docklands Light Railway (DLR) did with the same bank, the Royal Bank of Scotland," said a Merseytravel spokesman.

Alistair Darling said he would not back Merseytram 'at any cost'

"The government accepted DLR were allowed to do this but not us, and we are seeking clarification on this as well."

Total costs for Line One of the project - from Liverpool city centre to Kirkby - have risen to �325m from �225m in the past three years.

Mr Darling told MPs, in a written statement on Monday, that he was still committed to Merseytram but "not at any cost".