TfL and Tube Lines Disputes Continue

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Perhaps predictably, the recent Arbiter decision on funding for the Second Review Period (RP2) of the PPP agreement with Tube Lines hasn’t marked the end of the dispute with TfL. With the saga sure to drag on for some time both parties will likely continue to feature in the news, and a couple of interesting stories have already appeared giving an insight into their relationship.

On New Year’s Day The Daily Telegraph reported Tube Lines’ unusual step of reaching for the Freedom of Information (FOI) Act in its latest bout with TfL. The company claimed that LU planned to allow itself five times more full line closures for the Victoria Line upgrade than Tube Lines expects to be granted on the Jubilee Line, and spent twice as much per kilometre – £20m vs £10m – than Tube Lines is spending on Northern Line work:

“If we’d had even a proportion of the full line closures that have been granted on the Victoria line, we are very likely to have finished the Jubilee line by now.”

LU challenged the comparison, citing the different lengths of the Victoria and Jubilee Lines and claiming that Tube Lines originally asked for twice as many Jubilee Line closures. The Telegraph also quoted interim MD Richard Parry’s denial that Northern Line costs were directly comparable:

“We only recognise £100m as direct cost comparisons, which is around £4.5m per kilometre,” Mr Parry said [and] added that, given “the billions of pounds we are spending, it’s very difficult to get information out of Tube Lines. They want to dig out information on us that we don’t think is particularly relevant to them but we have complied with their FOI request. Part of our reluctance was we suspected they would be up to no good with it.”

Meanwhile, according to comments from chief executive Dean Finch in The Guardian, TfL made an offer to buy Tube Lines last year (although the company denied receiving an approach in December). Finch also says that the company’s solvency was considered amidst concerns of bankruptcy following the Arbiter’s December ruling; unsurprisingly, he sees the outcome as better news for taxpayers than shareholders:

“I don’t think Tube Lines is insolvent. I think it can survive this but it is extremely challenging […] This is a fantastic deal for taxpayers but probably not a very good deal for shareholders. They are going to have to work very hard to make a return.”

Written by Totteridge