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Thursday, 3 May, 2001, 11:14 GMT 12:14 UK
The London Underground

The London Underground is one of the longest running transport problems in the UK - why is it still being argued over?

London's transport problems are bigger than any other British city Three million journeys are made every weekday on the London Underground - more than the entire rail network in the UK.

Labour promised a part privatisation of the Underground but four years on, the plans are mired in controversy and a year behind schedule.

Meanwhile, the Underground remains one of the most expensive, over-used and underfunded urban transport systems in the world.


The Tube is the oldest underground railway in the world, serving some 275 stations on 253 miles of track.

Opened on a small scale in 1863, last year passenger numbers rose above one billion.

But overcrowding is a daily problem and commuters regularly have to endure maintenance problems and breakdowns.

One in 20 peak trains don't run, escalators remain broken for months and some stations have been neglected since they were built.

The Tube is estimated to need 1.2bn worth of immediate investment and a further 400m annually just to keep it going.

Labour has long blamed the problems on "chronic underinvestment" caused by short-term financial planning.

It rejected the Conservatives' then plan for privatisation and proposed a public/private partnership (PPP).

It [the PPP] will mean the traveling public will get more reliable, better quality investment, delivered far more efficiently and cost-effectively

John Prescott, June 1999
Under the PPP, the tube, station services and drivers would be operated by a publicly owned and publicly accountable London Underground.

Three private groups would take 30-year leases to maintain and upgrade all of the infrastructure from the track and tunnels to the lifts and escalators.

These "infracos" - infrastructure companies would spend some 13bn over 15 years and recoup their money over the second half of the contract term.

At the end of the lease, the assets would return to the public sector.

The government says that 52 stations will be modernised in the first five years, including some of the most overcrowded stations such as Leicester Square and Brixton.

Two preferred bidders have been named to enter final contract negotiations for the "BCV" and "JNP" deep tunnel parts of the system, named after the initials of the lines in each package.

  • Metronet, comprising Balfour Beatty, WS Atkins, Thames Water, Seeboard and Adtranz, is bidding to run the Bakerloo, Central, Victoria and Waterloo & City lines.
  • Tube Lines, comprising Amey, Bechtel-Halcrow and Jarvis, is bidding to run the Jubilee, Northern and Piccadilly lines.

    No preferred bidder to run the sub-surface lines has been announced so far. An initial idea to integrate these with the national railway network made no headway.

    Click here for a diagram of how it would work


    A key benefit of the PPP, said its advocates, is that it transfers to the private sector. Secondly accountants for the government said it could save 3bn over other schemes.

    PPP proposals
    2010: Jubilee, Victoria
    2012: Piccadilly
    2015: District, Circle, E London, Metropolitan, Hammersmith & City, Northern:
    2019: Bakerloo
    Stations modernised by 2009
    CCTV for carriages/stations
    24-hour repair targets for escalators
    48 hour signaling repair targets
    But opponents, which include the London Mayor, Ken Livingstone, Liberal Democrats and various transport economists and academics have questioned the high level of efficiency savings.

    Mr Livingstone made opposition to the PPP the main plank of his 2000 mayoral campaign, arguing that Londoners wanted the Underground to remain wholly publicly owned.

    After being elected, Ken Livingstone brought in Bob Kiley, the man responsible for modernising public transport in New York, to implement his transport strategy.

    Mr Kiley immediately attacked the PPP scheme as "fatally flawed".

    Safety would be compromised, he said, because the public would own the tube but not control it. He wanted the Underground to be kept as a single integrated entity under his control.

    One of the companies now marked in the preferred bidder consortia is Balfour Beatty.

    It, along with others, is under investigation over what role it played in the 2000 Hatfield train crash in which four people died.

    But ministers have insisted that not only would London Underground be responsible for the day-to-day operations, but PPP would only go ahead following approval from the Health and Safety Executive.

    After spending 100m, the creators of PPP have come up with something which defies common sense and repeats the mistakes that led to Hatfield

    Robert Kiley, London Transport Commissioner
    John Prescott has cited the success of the Docklands Light Railway - the overland system connecting east London's office developments with the centre - as a privately financed scheme delivered on budget and ahead of time.

    Mr Kiley has also attacked the maintenance timetable, saying that PPP would mean delays and breakdowns continuing on most of the system for another decade - despite rising passenger numbers.

    An alternative plan, put forward by Transport for London, the body run by Mr Kiley, would replace or refurbish 85% of trains in seven years.

    That alternative plan involves issuing bonds.

    A new Underground trust would raise finance without splitting up the tube by issuing bonds against existing passenger revenues and proposed congestion charges.

    Supporters point to the New York Subway as a metro that has successfully used bonds to regenerate the system and expand at a lower cost to the public purse.

    But the scheme would also require an underwriter to guarantee the returns - almost certainly in the form of the government.

    It is this risk that ministers refuse to take on.


    After months of apparently unproductive meetings, a deal appeared to be on the table in February.

    Mr Prescott announced PPP could be modified to give Mr Kiley "unified management control" in return for the mayor's team dropping the bonds proposal.

    Transport for London's Plans
    Nearly 13m investment over 15 years
    One third funded by bonds
    Stable investment from Government
    Private sector to play 'significant role'
    But TFL retains overall control
    TFL responsible for running trains
    But Mr Kiley said that the government had failed to give him total control of tracks and signalling. Ministers accused him of moving the goal posts, something which he denies, and the talks broke down.

    Tony Blair reportedly intervened to defuse the crisis and get negotiations back on track.

    However, despite fresh negotiations, Transport for London says that it will still press ahead with a judicial review of the government' position.

    That legal action was originally set for days after the general election. But it has been substantially set back to 23 July to allow room for negotiations. Is a deal finally emerging?

    But the dispute raises questions about the mayor's transport responsibilities as set out in the Greater London Authority Act.

    According to the act, the Mayor is required to "develop and implement policies for the promotion and encouragement of safe, integrated, efficient and economic transport facilities and services to, from and within Greater London."

    Mr Kiley maintains that PPP fails to satisfy the mayor's legal duties because the proposed system would be "neither safe nor integrated".

    But one thing is certain; the dispute has overshadowed the election campaign in London.

    The Conservatives and Liberal Democrats have recognised that the issue is important to the capital's voters - and a problematic one for Labour.

    While the Toies attack Labour's handling of the tube's future, it has pledged to tear up the current scheme and renegotiate it with Bob Kiley and Transport for London.

    Crucially, it says that a "no-strike deal" by London Underground staff would be at the heart of its rejuvenation - though it's far from certain that the unions would agree.

    Ken Livingstone has appealed to London's electorate to reflect on the importance of the Tube to their lives - and 11 of Labour's top 30 marginal seats are in the capital and the south-east.

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