the four bidders for the £10bn part-privatisation of London Underground this week received letters believed to contain improved compensation offers
The letters were received on Wednesday. It is understood that they discuss the pay-off that the losing consortia for the two deep lines packages will receive to compensate them for delays to the project. At present, they are expected to get £5m each.

One bidder said the matter needed resolving. He said: "They [the DETR] have to clear up the whole thing at this stage." The new offer follows initial talks between the bidders and Transport for London chief Bob Kiley in the last week. Kiley was allowed to make changes to the contract at the start of the month by deputy prime minister John Prescott.

One bidder said the talks were positive, although Kiley did not reveal further details about his proposals for a unified management structure to oversee the partly privatised Tube. The bidder said: "It was an exchange of views. Kiley was keen to get up-to-date on the specific details of the deal so he can further work on the unified management system."