Underground bosses clash over estimated cost of Tube line upgrades

A fresh war of words erupted between Tube Lines and London Underground (LU) yesterday in the ongoing row over how much

it should cost to upgrade the capital's creaking Tube system.

Tube Lines is fighting hard to push up the price for its next seven years of work on the Jubilee, Northern and Piccadilly Lines, after Chris Bolt – the arbiter brought in to settle the dispute – produced a draft determination of £4.39bn, which is £1.35bn lower than Tube Lines' own estimate.

In the latest bout, the company claims that cost estimates LU provided to the arbiter on its own upgrade of the Victoria Line are too low, potentially dragging down the ruling on the Tube Lines deal.

But LU's managing director, Richard Parry, said the contractor was "dissembling" and was"deliberately confusing" attempts to produce a like-for-like comparison between the two organisations.

Tube Lines says information it obtained under the Freedom of Information Act suggests that costs of nearly £13m per kilometre on the Victoria Line, more than double the £4.5m per kilometre figure that London Underground submitted. As requested by the arbiter, LU submitted a breakdown of its calculations this week.

Tube Lines claims that the sums exclude key items including project management and systems integration which would bump up the costs. Andrew Cleaver, the commercial director of Tube Lines, said: "The number submitted to the arbiter doesn't appear to match up with the costs they should have put in there."

But LU claimed that the only costs which have been stripped out are those which have no equivalent in the Tube Lines contract with which it is to be compared.

Mr Parry said: "We stand by the analysis we submitted. We have done our very best to establish what is comparable, and in good faith we have come up with an analysis and shared it with the arbiter and with Tube Lines."