Livingstone threatens action over Tube plans

Report says government's plan must be reviewed

London Mayor Ken Livingstone has threatened the government with legal action if it proceeds with its plans to modernise the London Underground.

An independent report has ruled the government's plans represent "poor value for money" and could jeopardise passenger safety.

The report by the Industrial Society said the government must introduce a much tougher value-for-money test if it was to go ahead with its proposed part-privatisation of the capital's crumbling network.

There is a possibility that a genuine public-private sector partnership can be established

Will Hutton, Industrial Society

The report also raised safety fears surrounding the public-private partnership (PPP) scheme, which it said needed to be fully investigated by Health and Safety Executive.

Mr Livingstone told BBC Radio 4's World At One programme: "If [the government] wants to go ahead with the same scheme, that must be challengeable in law as unreasonable behaviour."

Mr Livingstone has proposed raising the money for the modernisation programme through a bond scheme instead of the PPP plan.

Thirty-year contracts

Under the government's plan, the Tube would be separated into three parts, with its infrastructure and maintenance handed over to private firms on 30-year contracts.

While the report said the PPP scheme would bring about a much needed improvement in the performance of the Underground, it was doubtful whether it represented good value for money.

Ken Livingstone favours a bond scheme

It also warned the government's proposed procurement arrangements did not do enough to counter the risk of over-generous "sweetheart deals" being awarded to favoured contractors.

There was also potential, under private contracts, for safety being "traded off" against other improvements.

'Amber light'

Industrial Society chief executive Will Hutton described the report as an "amber light" for the PPP scheme.

"We recognise that the PPP could deliver considerable gains and with goodwill on both sides, there is a possibility that a genuine public-private sector partnership can be established," he said.

Mr Livingstone said it would be "unreasonable" of the government to go ahead with the PPP in the light of the report, without radical changes.

"This is a rotten deal which binds London for 30 years to over-generous contracts"

Ken Livingstone

"What Will Hutton has done is offer the government an honourable way out," he said.

"I would need to get legal advice, but I would have thought to proceed now in the light of Will Hutton's complaints - unless they adapt and take on board his points - there is an opening for a judicial review of the decision.

"I am not opposed to partnership with the private sector on principle, but this is a rotten deal which binds London for 30 years to over-generous contracts giving private sector monopolies intolerable powers over London's democratically elected authorities," he added.

Shadow transport minister Bernard Jenkin said: "The report was commissioned for Ken Livingstone at Labour's insistence and has been welcomed by the party's leadership. The author's findings are a spectacular blow to John Prescott.

"Of course, Will Hutton is simply confirming that Labour's PPP is a botched privatisation and will not provide value for the taxpayer."