Costs have risen since the scheme was approved in 2002

Merseyside's five local authorities will meet on Friday to discuss revised funding for the Merseytram system.

Confusion has surrounded the future of the project amidst spiralling costs and the government's refusal to increase its funding for the scheme.

But Keolis project manager Mike Flynn said the system would be in service for Liverpool's Capital of Culture year.

Spiralling bill

"It will be finished in 2008 and it will be open in 2008," he told the BBC.

Mr Flynn said there would be a period of testing in the first half of the year when trams would run without passengers.

He added: "We will reach a full passenger service timetable in the mid months of 2008."

In June, all five local authorities expressed their support for the scheme despite uncertainty over funding.

The total bill for Line One of the project - from Liverpool city centre to Kirby - has increased to �325m from �225m.