Chairman Pip's Railway Thoughts

It isn’t really private is it

Posted in Great Britain, Infrastructure, Metro by Chairman Pip on 3 February 2010

And so the lunacy of the PPP foisted on Transport for London continues. Tube Lines, already suffering enormous criticism for the late delivery of the upgrade to the Jubilee Line, has now announced that they will need the Northern Line closed for 82 weekends over the next two years, as well as early closure during the week for 16 months from July. The Northern Line is the major trunk north-south Undergrond route through London, and is the busiest on the Underground network, with as many as 800,000 people using it per day. As a consequence, Boris Johnson, the Mayor of London, is furious:

The programme suggested is intolerable and there has to be a better way. I cannot possibly ask Londoners to put up with this pain unless Tube Lines can convince that every single closure is unavoidable and their overall plan will work. Their record of hideous delay and disruption on the Jubilee Line suggests otherwise.

The problem is that TfL are stuck with it, because they are bound by the PPP contracts, even though they didn’t actually want them. The Public-Private Partnership was the brainchild of our “esteemed” Prime Minister, when he was Chancellor of the Exchequer. The theory is that private companies are contracted to do work for public bodies, presumably at a cheaper price than would otherwise be possible. However, Tube Lines, although it is a private company, has only one customer, TfL – it doesn’t have any other source of income than what TfL pays it to do the maintenance work on three of the Underground lines. Therefore, it can’t really be called a private company – it is merely an extension of Transport for London, being paid public money to do public works, but it just happens to be owned by private companies. Tube Lines is responsible for maintaining one-third of the network (Jubilee, Northern and Piccadilly); the remainder was the responsibility of a second PPP firm called Metronet. This company operated from 2003 until 2009 as a private concern but, because TfL was its only customer, and because TfL and Metronet disagreed over the cost of the work needed, Metronet eventually went into administration and was subsequently nationalised as part of TfL, to ensure that the work that needed to be done on Metronet’s two-thirds of the network would continue. The government had to pay £2 billion to the takeover of Metronet, with the company’s five shareholders liable for only £70 million each. Now, with Tube Lines seemingly on the same road (they are now also in disagreement with TfL over the cost of the next batch of work), will lightning strike twice? There’s every possibility, and TfL’s management have floated the idea of taking over Tube Lines as it did with Metronet, and once again bringing all of the work in-house. It’s a rare thing when you find Boris Johnson and his predecessor, Ken Livingstone, in agreement, but this is one of those few occasions where both agree that the PPP has been a nightmare for all concerned. And we know who’s responsible for it.

“£2bn of public money goes down the Tube as Gordon Brown counts cost of failed deal”
“‘Intolerable’ two-year misery for Tube users”

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