Tube PPP will cost taxpayers £1bn a year

Click to follow
The Independent Online

The Government's masterplan to modernise the Tube by contracting out its infrastructure maintenance to the private sector will cost taxpayers £1bn a year, raising fears that the move will be a poor deal for the public, according to the National Audit Office.

The Government's masterplan to modernise the Tube by contracting out its infrastructure maintenance to the private sector will cost taxpayers £1bn a year, raising fears that the move will be a poor deal for the public, according to the National Audit Office.

In a report published today, the body highlights the high costs and delays already incurred in the signing of public private partnerships with companies including WS Atkins, Balfour Beatty, Jarvis and Amey.

The total cost of the project to taxpayers at current valuations is almost £16bn, which will have to be repaid over 30 years.

That will give the companies involved an annual return on their investment of 20 per cent a year - much higher than profits made by companies involved with other Government-led projects.

Edward Leigh, chairman of the Commons Committee of Public Accounts, said: "It is not clear at all that the Tube PPPs are good deals for the public sector. We can say for sure they are costly and complicated deals which contain a great amount of uncertainty."

The National Audit Office also calculated that raising funds to invest in the Tube in the private sector would work out as £450m more expensive than if it had been done by direct Government borrowing.

Comments