London's mayor says that London Underground would take over maintenance work if Metronet opted for insolvency
London mayor Ken Livingstone said yesterday that Metronet, the troubled London Underground infrastructure company, could collapse because of financial woes.
Livingstone said: “It is quite possible that the shareholders will opt for insolvency.” If that happened he said that London Underground management would intervene to take over maintenance and renewal work.
His message come just two weeks after Atkins, a stakeholder in Metronet, announced that it would be taking a £36m hit because of cost overruns on the programme. Balfour Beatty, also a stakeholder, said that Metronet’s finances were under increasing pressure.
Last week the two companies said that they remained “committed” to Metronet, but the relationship with client London Underground is worsening. It is likely that a lengthy extraordinary review by the independent arbiter will be necessary because neither party can agree on who should pay for what for the cost overruns.