MUSIC producer and rail enthusiast Pete Waterman has approached the National Railway Museum with an offer from an anonymous benefactor to take Flying Scotsman and complete its restoration.

The York-based museum was offered £450,000 for the famous steam loco, which would then have been operated by a third party for a decade before being given another overhaul and returned to the NRM.

A museum spokeswoman said it declined the offer, and revealed the refurbishment was now gathering pace and the locomotive should finally be ready to return to steam next summer.

Mr Waterman, whose engineering company, the London & North Western Railway Co Ltd, would have carried out the work, claimed the offer was worth about £2.5 million in total, telling The Press: “It’s the most amazing offer I have ever heard.”

The restoration of Flying Scotsman started in 2006, when it was expected to cost only £690,000 and be completed by August 2007.

The museum spokeswoman said it had become increasingly apparent as the project went on that more work was needed than originally anticipated and the total cost of the restoration was now estimated at £1.6 million.

She said it had been funded through a grant from the Heritage Lottery Fund, corporate sponsorship, individual donations, income from the sale of Scotsman products and the “Steam Our Scotsman” appeal, to which the public had so far generously donated more than £199,544.

She said: “The NRM is careful to ensure that Flying Scotsman meets the highest standards of safety, efficiency and engineering quality and therefore the restoration is a lengthy and complicated process.

“The project is now gathering pace, with the chassis due to return to the museum from Ian Riley & Son Ltd in the next few weeks, ready for the locomotive’s return to steam in summer 2011.

“Discussions are underway with operating partners to establish the schedule for Flying Scotsman’s first season on the mainline and an announcement will be made to the public as soon as they are finalised.”