Conclusions and recommendations
Major works
1. The
Government set an affordability threshold for the London Underground
PPP which meant that work had to be delayed until after the first
seven and a half year contract period. The Transport, Local Government
and the Regions Committee warned that there was a real prospect
that this would recur at future reviews: it must not happen. (Paragraph
6)
2. We strongly support
London Underground Ltd's initiatives to establish alternative
suppliers to the infracos for infrastructure improvements. Not
only will this help to reduce the cost of additional works in
the short term, it should help the PPP Arbiter determine a fair
price for the PPP if there is disagreement during the future reviews.
(Paragraph 9)
Performance
3. 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. (Paragraph 17)
4. 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. (Paragraph 18)
Safety
5. The
HSE noted that there had been an increase in the number of incidents
with potential for an adverse effect on safety over the last three
years. Many of these may have been an unavoidable consequence
of the ageing assets, rather than a direct result of infraco performance.
Nonetheless an increase in the number of incidents has potential
to become an increase in the number of accidents. The infracos
and LUL must ensure that the complex interfaces between the many
organisations involved in the underground do not increase the
risks. (Paragraph 23)
6. It is clear that
the fragmentation of the system has led to inconsistent communications
between the infracos and their employees. Much better communication
and consultation is needed. At the very least, the infraco management
and LUL need to ensure that all employees know that no matter
who is employing them, the same standards of training are required
for the same tasks.(Paragraph 26)
London Underground's powers
7. As
the result of the PPP, London Underground is left with a plethora
of different arrangements with private partners all responsible
for different bits of the infrastructure. It has no public interest
right to terminate the PPP contracts. It is responsible for the
overall running of the Underground and for managing the performance
of the infracos. It vital that it has the information it needs
to do its job. It is astonishing that it took a year to negotiate
access to the information London Underground needed. (Paragraph
29)
Ownership
8. The
PPP was drawn up in the expectation that shareholders in the infracos
might change during the 30 year life of the partnership. When
it was in difficulties, Jarvis was able to use its share in Tube
Lines as a source of funds. On this occasion, London Underground
Ltd was able to ensure that the change was acceptable, but we
agree with them that the PPP contract is susceptible to the changes
in the commitment of the members of the consortia to the London
Underground. Future transfers might not have such a satisfactory
outcome. Members of the consortia can sell their share in the
Underground relatively freely; the taxpayer is committed to continued
funding of the PPP whatever changes in ownership occur. (Paragraph
32)
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