Tube Upgrades At Risk As Tube Lines Are Denied £327m claim
Tube Lines claim for an additional £327 million of public funds, for changes imposed by London Underground which they alleged infringed their PPP contract, has now been rejected “in its entirety”. The adjudicating QC found that London Underground bore no responsibility for Tube Lines increased costs and also ordered them to pay LU’s costs.
This comes at the same time as Tube Lines, owned by Bechtel and Ferrovial, is struggling to negotiate the funds they believe are necessary to deliver the second 7 yr tranche of PPP work, which kicks off in July. Tube Lines wants £5.7b, whereas the PPP Arbiter (Chris Bolt) will only approve the £4.4b which he feels the work should cost.
As Tube Lines admit insolvency concerns, doubts are now being raised as to whether they may consider abandoning their 30 yr PPP contract to upgrade the lines, which would of course jeopardise the Northern Line’s signalling upgrade ready for the Olympics. But as each month of delays is thought to be costing them £10m, and the Jubilee Line being 10 months behind schedule when it is delivered in October, this is a significant possibility.
LU’s forthright acting MD, Richard Parry, said: “Tube Lines need to stop making spurious claims for additional fare payers’ and taxpayers’ money, given the handsome returns being earned by shareholders Bechtel and Ferrovial, and get on with the job in hand.
Further detail can be found on TfL’s news page.