Examination of Witness (Questions 270-295)|
WEDNESDAY 28 NOVEMBER 2001
280. But you are not familiar with a business
case for it?
(Mr Kiley) I do not know why seven and a half was
chosen instead of five or ten, maybe it is because it lies between
five and ten; but I do not think it was more complex than that.
281. Okay; plucked out of thin air. On the issue
of extensions, the contract, clearly, at one stage, tended to
be quite firm, and then I understand that any major extensions
that may be required fall upon Transport for London; is
that the case, under the PPP? If there is further work needing
to be done outside the contract, further development of the underground
system that falls outside of the terms of the PPP, then I think
the ball falls back in your court, does it not?
(Mr Kiley) It does, but the Infracos will still be
very much involved in that, and in as much as the consortia will
control the infrastructure companies for 30 years, so any enhancements
or improvements that require collaboration or priorities being,
shall we say, established by the Infracos, it is sort of a roll
of the dice. I am not saying that they are going to be doing the
projects, but we are going to have to be working cheek by jowl
with them, with, for example, enhancements or extensions of transit
lines, because it will be in their territory.
282. And have you had any discussions with the
Government about how these will be financed, further extensions?
(Mr Kiley) There are ongoing discussions with the
Government about financing of enhancements and extensions, yes;
Crossrail is one example of that, the East London Line.
283. Looking at the prospectus for the PPP,
there are various claims being made, I just really want to ask
you whether you think the business plan you have got will match
them, and a yes or no will really do?
(Mr Kiley) Yes.
284. All of them?
(Mr Kiley) Yes.
285. Mr Kiley, in answering an earlier question
from the Chair, you did say that when the question was, if PPP
fails, how long would it take to put your management plan and
financing into place, and I think you said between two and four
(Mr Kiley) Yes, if PPP does not happen, for whatever
reason, then I would say we would have a management team in place,
it will not be thoroughly fleshed out, within three or four months,
and we will be in a position, at least on rolling-stock, to begin
the procurement process, assuming there are resources for it,
almost immediately. But we would also commence immediately, in
week one, the thorough-going assessment of the physical plant,
particularly those so-called grey assets that have not really
been assessed at all in the recent past.
286. The answer you gave to the Chairman you
are repeating now. My question to you is, how do you envisage
that PPP will not go ahead, because the inference is that, well,
there is no alternative; how can you do it?
(Mr Kiley) My belief is that PPP does not meet and
will not meet the value for money test and will not pass the safety
test, and that it is, basically, fundamentally unmanageable, it
is a freak of nature.
287. So what you are saying then is that, from
your point of view, and because of the research that you have
undertaken, you are advising the Committee today that you consider
PPP will not go ahead; is that right?
(Mr Kiley) I am not the one who makes the decision,
so I cannot really make that statement. All I can say is that
I do not believe that it is fit to go forward, by the Government's
own tests and standards.
288. Let me put it another way then. If you
are of the opinion that PPP will not be in the best interests
of passengers or for the underground system, what are you prepared
to do to make sure that the passengers' safety and the London
Underground system come first?
(Mr Kiley) I will use every breath left in me to keep
making this case, during the period when the decision is going
to be made, hoping, praying, that the Government decides not to
289. Have you any allies to that, is there any
other evidence that will substantiate what you are saying this
(Mr Kiley) I think the riding public all oppose it,
overwhelmingly, in London, the people who watch this in London,
London itself, the business community; almost everywhere I have
gone there is an overwhelming resistance to PPP. There was a poll
that I read about in the newspaper last week, 7 per cent of those
polled were supporting PPP and between 40 and 50 per cent wanted
it stopped, immediately, and I think the opposition to this in
London is overwhelming. That is not just among users and citizens
but among experts and people who have looked at this plan; there
are times when I am not sure that there are many people in the
Government who really support this, you do not hear ringing defences.
290. Is a half and half solution possible, with
Transport for London running one part of it and an Infraco
concession running the other half?
(Mr Kiley) My honest reaction to that is that that
is really an inane notion. Either PPP is solid and works, or it
does not. To begin to suggest that maybe one will be held back
because it fails this test or that, I think that is a sign of
desperation. PPP either goes and makes the case as a coherent
concept, or it does not; if you scrape the barnacles off a third
of it and then try to throw it over the transom to the public
sector, it is just going to make a worse mess than already exists.
291. Do you have full confidence in the Health
and Safety Executive on the safety case?
(Mr Kiley) I have met with the Health and Safety Executive
recently, and this was an extensive meeting, and I think they
are treating this with the utmost seriousness. They are very clear
that they are going to take all the time that they believe they
need to finish this off, and I think they know that the world
will be watching this, so I believe that they are going to give
us their best professional undertaking.
292. And how fed-up are you with the whole process?
I could imagine that you would almost feel, well, you might as
well walk away from it?
(Mr Kiley) No, I do not feel that way at all. The
democratic process is wending its way forward, and I could not
have survived in Boston and New York if I had been impatient about
politics, because those can be pretty brutal cities as well. It
is the price we pay for having the kind of country that we have,
which is generally wonderful; but we got this one wrong, and I
hope, eventually, the democratic process will work its way forward
and we will all see the wisdom of moving away from PPP.
293. Can you finish with any good news; the
East London Line, Crossrail, the Hackney-South West Line, is it
making any progress?
(Mr Kiley) We have formed a company, joint venture,
between the Strategic Rail Authority and ourselves, that will
move both Crossrail and Chelsea/Hackney forward. The East London
Line Extension, where we are working in collaboration with the
London Underground, has already begun construction. We had resource
problems, serious resource problems, with each of those projects.
I think we can probably come up with creative solutions for financing
Crossrail, if the more ambitious configuration is accepted; but
for the East London Lines, we are going to need help from some
quarter, namely the central government, for that project to continue,
and this is an example of one that we are building on an annualised
basis, and it makes me very uncomfortable. There is not a commitment
yet to the overall financing of this programme, and it is urgently
needed, and I hope it will come early in this next fiscal year.
294. Is it now, with all the delays that have
taken place, with all the mechanics that we still have to go through
to get PPP decided one way or the other, if we look through the
next five years, in five years' time, is it actually possible
now to deliver noticeable improvements to the tube service?
(Mr Kiley) I think, under the best of circumstances,
given the task ahead, that it will be four, five, maybe as many
as six years before there is perceptible improvement on a wide
scale. It will begin to emerge, if we get it right from the beginning,
after 18 months, two years, but it will be in pockets, and it
will be by no means system-wide; but, certainly, by the end of,
let us say, a seven and a half year period, which is the number
we are working with right now, you should expect to see very substantial
improvements. When you get to the three- to five-year mark, if
you are doing it well, you develop a kind of momentum that gathers
itself, and you have got the self-confidence, the experience base,
the resources have been invested, and it really does gather significant
force. And I just speak from my New York experience, which was
seven years, just a little bit more than seven years, that you
get to that mid point and you can just feel it lifting. But the
first few years will be very, very tough, very tough, and the
truth is that the public will experience a different kind of disruption,
but frequently as debilitating as they experience now. Because
in the big tube lines there are going to have to be line closures,
station closures, to really get this work done at a rapid pace,
and that is going to be very disruptive, and there will have to
be great co-operation from those who are providing a bus service
and the people who are running the Underground, and making sure
that there is at least some minimal acceptable level of transportation,
and we have to go through this, but there is no escaping it.
295. Mr Kiley, that is very helpful. We are
always grateful to you for coming to give us evidence and it is
always useful. Thank you very much indeed.
(Mr Kiley) Thank you for the opportunity, Madam Chair.
Chairman: I have failed in my duty. I should
have asked for declarations of interest. Can I have the declarations
of interest, please.
Mr Donohoe: A member of the Transport and General
Mr Stevenson: Transport and General Workers'
Mrs Ellman: Transport and General Workers' Union.
Mr O'Brien: Working Men's Club.
Chairman: I am a member of the Rail, Maritime
and Transport trade union.
Miss McIntosh: I am a minor shareholder in Railtrack,
First Group and Eurotunnel.
Chairman: Thank you very much.