Boris Johnson to bring London Underground upgrade work back into public sector
Transport for London has bought out the £310m private stake in Tube Lines, ending the Underground’s PPP fiasco.
Mayor of London, Boris Johnson, and Transport for London have entered an agreement to buy the £310m private equity stake in Tube Lines from consortium partners Amey (a subsidiary of Ferrovial) and Bechtel.
The buy-up will make Tube Lines a wholly TfL-owned entity.
Johnson said: “Freed from the perverse pressures of the Byzantine PPP structure, I am confident that London Underground and private contractor are more than capable of delivering the improvements to London’s transport network we need, on time and on budget.”
Amey will continue to provide management and maintenance services, whilst Bechtel will hand over capital works after an interim period.
However, the Rail, Maritime and Transport Workers Union’s general secretary, Bob Crowe, has warned Boris Johnson to expect industrial action over any job cuts.
Crowe said: “We have made it clear again today that unless we get assurances that staff will not be expected to pay the price for the collapse of Tube Lines and the last knockings of the failed tube privatisation experiment we will push on with plans for action and our ballot of members will go ahead.”
The move comes after the public-private partnership arbiter ruled that London Underground should pay Tube Lines £4.46bn for work over seven-and-a-half years. LU maintains it should give the firm £4bn to deliver the upgrades. Tube Lines, insisted it needed £5.75bn to deliver the upgrades.
Completion of the sale is expected on 30 June.