Metronet nearer exit from administration
Metronet has lurched a step closer to exiting from administration after it cancelled a major contract to upgrade the signalling systems on nearly a third of the London Underground network.
The company said that the cancellation of the £550m contract, which had been previously granted to Westinghouse Rail Systems, would result in "significant savings" and allow it to keep completion of the troubled multibillion-pound project on track. The contract will be re-tendered once Metronet emerges from administration and will be overseen directly by the company.
Administrators have been working for months to unravel the labrynthine structure that governed Metronet, a firm set up by five private companies to overhaul the Tube. It went into administration in July amid £2bn in cost overruns. Transport for London, the company that controls the Tube and is ultimately overseen by the Mayor of London, Ken Livingstone, has agreed to take over Metronet once it has returned to health.
Tim O'Toole, managing director at London Underground, said the deal was a "real step forward in the process of removing Metronet from administration". He added: "A great deal of progress has already been made and we remain on track to transfer the two Metronet companies to two Transport for London nominee companies as soon as possible."
As a result of the dissolution of the contract yesterday, Bombardier agreed to make a one-off £95m payment to Invensys, the owner of Westinghouse. The train-maker had originally subcontracted the work to install a signalling system on the Circle, District, Hammersmith & City and Metropolitan lines to Westinghouse.
Invensys said it still expects to book £180m from other upgrade work and that it plans to bid on the lost contract when it comes up again for tendering. The contract under which Bombardier is providing 47 new trains to the Victoria line while Westinghouse upgrades the signalling system, will continue untouched.
Metronet entered administration in July last year amid cost-overruns and delays. Its failure is a major source of embarrassment for Gordon Brown, who had hailed the project as a prime example of the Public-Private Partnership (PPP) model that has been championed by the Labour government. In an indication of the inherent complexity of Metronet's structure, the move was explained in four press releases, each published by different parties to the negotiations.
- 1 Rarest Beanie Baby bought for just £10 at car boot sale could be sold for £62,500 on eBay
- 2 Katie Hopkins and The Sun editor David Dinsmore reported to police for incitement to racial hatred following migrant boat column
- 3 Giorgio Armani criticises the way some gay men dress saying 'a man has to be a man'
- 4 Rebecca Francis accuses Ricky Gervais of using 'influence' to target female hunters after receiving barrage of death threats
- 5 Australian student Tommy Connolly, 23, adopts his pregnant, homeless 17-year-old cousin to give her a chance at 'a better life'
Rarest Beanie Baby bought for just £10 at car boot sale could be sold for £62,500 on eBay
Katie Hopkins and The Sun editor David Dinsmore reported to police for incitement to racial hatred following migrant boat column
'Jihadi John': Isis executioner Mohammed Emwazi wanted to wage jihad in Somalia until his friends were betrayed and killed by al-Shabaab
Parma, Missouri: 80 per cent of town's police quit after first black mayor is elected
Australian student Tommy Connolly, 23, adopts his pregnant, homeless 17-year-old cousin to give her a chance at 'a better life'
If I’m being racially abused I don’t need a stranger with a saviour complex to rescue me
The only black face in the Ukip manifesto is on the page about overseas aid
Ukip is the only main political party to not address LGBT rights in its manifesto
Food banks: One million Britons will soon be using them, according to Trussell Trust
Religion isn't growing, it is becoming vigorous in its demise, says philosopher AC Grayling
BBC election debate: The one photo that summed up the whole 90-minute leaders debate
iJobs Money & Business
£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...
£30 - 35k (DOE): Guru Careers: We are seeking a Pricing Analyst with experienc...
£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...
£21000 - £24000 per annum: Ashdown Group: The Ashdown Group has been engaged b...