Transport for London is expected to take control of Metronet – maintenance and renewals contractor for most of the Underground network – early in the new year.
The PPP administrator of Metronet, Alan Bloom of accountants Ernst and Young, confirmed on 6 November that TfL’s was the only formal bid to have been received.
London Underground’s managing director, Tim O’Toole, said: “We are now working with the administrator to transfer the Metronet companies to Transport for London’s control in early 2008.”
Under TfL’s plans, the staff and assets of the two companies (Metronet Rail SSL for the sub-surface lines and Metronet Rail BCV for four of the deep-level lines) will be transferred into two nominee companies. They will be managed on a stand-alone basis while the long-term structure is agreed with the Mayor and Government. Tube Lines, contractor for the other deep level lines, is unaffected by the proposals.
Mr O’Toole said: “An exit from Administration as quickly as possible is the best way to maintain the continued safe operation of the Tube network, to mitigate the performance and cost risks that inevitably come with such a situation, and to ensure the continuation of the Tube’s vital upgrade and renewal programme.”
He paid tribute to the hard work and dedication shown by all Metronet and London Underground staff, as well as the Administrator’s team, in achieving the continued safe and reliable operation of the Tube network.
TfL’s bid for the two Metronet companies has been constructed on the basis that there should be no net additional cost to the organisation. Mr O’Toole added that once under TfL control, it would seek to put in place a “stable, economic and efficient structure” to deliver investment priorities to increase capacity.
The two Metronet companies went into Administration in July after an emergency funding decision by Chris Bolt, chairman of the Office of Rail Regulation, who is also the arbiter for Metronet’s contract with TfL. He awarded just £121 million to Metronet Rail BCV but the company had been seeking an interim £551 million and £992 million in total.