Tube Lines – the end?

I have been hearing reports that the PPP Arbiter for the Tube, Chris Bolt, is minded to rule much nearer TfL’s estimate of the cost of the next 7.5 year period than the amount Tube Lines is seeking. If that is the case, then probably Tube Lines would decide that it is not worth the hassle and would walk away from the contract, which would spell the end of the PPP.

Now today, The Sunday Telegraph is reporting that TfL is drawing up contingency plans to take over the contract. Certainly it seems that given the huge dispute over the Jubilee Line and the problems that Tube Lines would have in raising any cash, the PPP’s days are numbered.

The delay over the Jubilee Line resignalling has tested TfL’s patience, culminating in Boris Johnson sending a furious letter to the company last week which could be read as a prelude to TfL actively trying to withdraw. What an irony it would be if the Jubilee Line were the catalyst for the collapse since it was precisely the overspending on the Jubilee Line Extension, a mere peccadillo of around £1bn, which prompted Gordon Brown and the Treasury to push through the PPP rather than simply giving LUL the money to upgrade the Tube for which it had been asking.

As I have written many times,the PPP is one of the great unheralded scandals of our time, having cost the taxpayer hundreds of millions – and probably billions – of pounds that could have been spent on upgrading the system instead of creating this complex system to upgrade the network. Yet, those accountable for this scandal, from Brown through his advisor Shriti (now Lady) Vadera and its inventor, Martin Callaghan now of PWC, have never been brought to book. Indeed, all been promoted or rewarded for this disgraceful episode.

It is precisely the complexity of the PPP and the fact that the detail of its contracts are hidden behind commercial confidentiality, that has prevented the scheme from getting the publicity which the sums of money involved merit.

  • Well, it’s our fault for electing these incompetent idiots in the first place.

    No, I tell a lie: the fault is entirely everybody else’s *except* mine. I’ve never voted for either Tory or Labour, so I can sit here in my grotty little basement with this hot cup of top quality M&S Smugness (with croutons). From their “Extreme Self-Righteousness” range.

    If the equally incompetent Tories get back in next year, this country will deserve everything it gets.

  • Dan

    Just goes to show how skilled you can be at making sure no one knows who is to blame – just make the whole thing too contractually complicated. Think how many other govt actions could benefit from this approach – eg maybe after Saturday’s news Tony Blair is wondering if the justification for going to war in Iraq could have been made so contractually complicated the press and public would not have understood the reason why – indeed the decision to send the troops in could have been farmed out to a regulator and maybe some ‘consultants’ of the type used in the PPP negotiations? I was not myself opposed to military intervention – but you can see the benefits that govt could obtain from much wider use of the PPP type contracts and structures in policy making and implementation.

    Makes one wonder if the real beneficiaries of this govt could be lawyers, financiers etc – all the people who are now turning against Labour for one reason or another – talk about biting the hand that feeds you!

  • RapidAssistant

    I’m pretty sure Ken is quietly sitting thinking “I told you so!”

  • Innocent Abroad

    I think it tells you all you need to know that the Tories never showed any great enthusiasm for this part-privatisation. The Tube is a “natural” (as economists understand the word) monopoly (like the armed forces) and in such cases there should be a presumption of direct in-house provision unless there is a darn good reason to bring in outsiders.

    But railways have always been political playthings, haven’t they?