3 Performance
10. The deferment of major projects has meant that
"In the first contract period of 7.5 years the infracos focus
on reliability improvements, station works and on Line upgrades"[14],
although some of these are long term projects which will continue
into the second period. The infracos drew attention to their achievements
in procuring extra trains and carriages, and making infrastructure
improvements, such as renewing signalling and refurbishing track.
Clearly a great deal of work is being undertaken by the companies
involved, and a significant investment is being made. Nonetheless,
the TfL Report on the first year of the partnership suggested
that not all was progressing smoothly: we note that Tube Lines's
plans for station enhancements "have been rejected by London
Underground as inadequate",[15]
and that information from Metronet BCV on the Victoria Line Phase
1 upgrade and the Central Line upgrade was lacking. This is disappointing
considering that the private sector was expected to bring project
management skills to the Underground. However, by the time we
took evidence, Mr Terry Morgan of Tube Lines told us that he was
not aware of a single large project that was running late.[16]
11. The Transport for London Report noted
Based on the limited information available, London
Underground has some concerns regarding progress on major projects
and track renewal work. The Infraco accounts for the penultimate
period of 2003/04 indicate actual capital expenditure at 80-85
per cent of budgeted capital expenditure for all three Infracos
for the year. The concern in this area is not so much the absolute
levels of spend, it is the amount of work being produced per pound
spent. For example, completing 50 per cent of a given length of
track renewal work in the time allotted due to poor planning and
inefficient working still incurs the budgeted cost for the full
scope of work.[17]
12. The TfL Report noted that the infracos were failing
to invest in new equipment which would enable them to work more
efficiently. Mr O'Toole told us that he had very little power
to force such investment and that it was "a constant cajoling
and negotiation", even though the companies' need to manage
their assets on a whole life basis should give them an incentive
to introduce new equipment once they decided it would be more
efficient to do so.[18]
Day to day experience
13. The passenger is interested in whether the Tube
is running reliably, rather than how that reliability is achieved.
On day to day performance the infracos are judged on three outcomes;
availability (assessed in lost customer hours, weighted according
to the type of service disruption), the ambience of the network
(the quality of the passenger experience) and the speed and quality
of fault rectification. Here the performance of the infracos has
been mixed.
14. The infracos present their performance positively.
Tube Lines told us that "We believe that, through our improvements
in performance, innovation and infrastructure enhancements, we
are beginning to make the transformations necessary to reverse
decades of under-investment and deliver a better railway for London.".[19]
Similarly, Metronet asserted "Overall, Metronet's performance
developed a positive trend during the seven periods of 2004/5
and whilst there is much progress still to be made, a more reliable
service to passengers is now becoming evident." [20]
15. It is clear that both companies have now improved
the ambience of the trains and stations for which they are responsible.[21]
New cleaning schedules have been introduced, and the frequencies
of deep cleans increased. Graffiti on trains has been almost eliminated.
We welcome this, but ambience is the easiest of the three performance
measures to improve, and although it is important to customers,
it is less important than a speedy, reliable service.
16. The evidence on availability of assets and lost
customer hours is more mixed. Although the companies both claimed
that availability measures were improving, their figures tended
to be based on an average over an extended period.[22]
In contrast, Transport for London's Report on the first year of
the PPP looked at availability in individual control periods.
Performance below a benchmark triggers abatements to the payments
made to infracos; performance worse than an "unacceptable"
level triggers a higher degree of abatement. TfL's figures showed
that only the District Line had consistently produced performance
that met the benchmark; on most other lines London Underground
had considered performance had frequently fallen below benchmark
and for several periods had been at the level considered "unacceptable".Table
1: Lost Customer Hours: Performance against Benchmark, 31 March
2003-March 2004
| Line | Number of periods in which performance was below benchmark (out of 13)
| Number of periods in which performance was "unacceptable"*
|
| Bakerloo | 4
| 2 |
| Central | 8
| 5 |
| Victoria | 9
| 5 |
| Waterloo and City | 9
| 6 |
| Metropolitan, Circle and Hammersmith
| 1 | 0
|
| District | 0
| 0 |
| East London | 6
| 3 |
| Jubilee | 8
| 5 |
| Northern | 7
| 6 |
| Piccadilly | 7
| 2 |
Note: TfL figures for lost hours have been
used; some lost hours were in "abeyance", that is subject
to dispute between LUL and the infraco concerned, and it is possible
that settlement of those disputes might slightly improve these
performance figures.
Data Source: London Underground and the PPP, TfL
Since we took evidence there have, of course, been
further frequent, widely reported engineering overruns and repeated
failures of signalling equipment, which have had a severe impact
on the travelling public.
17. It should be remembered that the benchmarks are
set separately for each line; and the benchmark for lost customer
hours was initially set at 105 per cent of London Underground's
historic level. In other words, the benchmark for a line with
historically poor performance is set low to reflect past performance,
and the benchmarks at the beginning of the PPP were lower than
performance under shadow running. Mr Weight told us that this
was done to take account of the disruption caused by the introduction
of the PPP, and that the target would rapidly become more demanding.[23]
The improvement expected by Tube Lines is as follows:
Year Per period target for lost customer
hours[24]
2005 345,869.2
2006 340,012.8
3007 337,230.8
2008 334,923.1
2009 333,451.3
The improvements expected on each of the Metronet
lines is printed with the evidence.[25]
Performance during shadow running was abysmal. Availability is
the most important factor for Tube travellers. All the infracos
needed to do to meet their availability benchmarks was to perform
only a little worse than in the past. On most lines, they did
not even manage that. We hope that they will be able to meet the
more demanding targets for availability expected in future; we
have no confidence that will be the case.
18. Mr Morgan of Tube Lines assured us that the penalty
payments incurred by engineering overruns affected managers' judgements.
Although the penalties were small in relation to the total service
charges, they flow "right the way to the bottom line".[26]
We believe that this should not be the only discipline on the
infracos. Since the funding for the Underground ultimately comes
from the public purse there should be absolute clarity about the
degree to which the infracos are meeting their targets. Although
this information is eventually published, there can be significant
delays before it is available. One of the reasons for the PPP
was to introduce private sector disciplines. We need to be able
to judge whether this has successfully improved performance. London
Underground already publishes some information about performance
on its web site; it should do so in a much clearer way. In addition,
Transport for London should continue to give a detailed report
on the performance of the PPP each year.
14 Office of the PPP Arbiter, Introduction to Public
Private Partnerships, http://www.ppparbiter.org.uk/int_to_ppps.html Back
15
p 19 Back
16
Q190 Back
17
p 20 Back
18
Q 122 Back
19
Ev 30 Back
20
Ev 46 Back
21
London Underground and the PPP: The first year 2003-4, pp 14-6 Back
22
Ev 33 Back
23
QQ180 -182 Back
24
Ev 35 Back
25
Ev 54-57 Back
26
Q 185 Back
|
