Rail groups signal Tube interest
Wednesday 19 August 1998
The list of organisations features more than 20 construction companies, 17 banks, a handful of other rail operators and a smattering of lawyers, accountants, consulting engineers and even one advertising agency.
Precise details of how the Deputy Prime Minister John Prescott's "public- private partnership" for the Tube will operate are fuzzy. But Mr Prescott has pledged that it will bring in pounds 7bn of private capital to modernise the Underground over the next three years while retaining ownership and operation of the network in public hands.
The Government is anxious that the exercise does not turn into the kind of gravy train for the private sector that British Rail privatisation proved. Former BR managers made a killing from the sale of the rolling- stock leasing companies. Sandy Anderson, managing director of Porterbrook, made pounds 33m after the business was sold on to Stagecoach within months of privatisation for a pounds 400m profit. Andrew Jukes made pounds 15m from the sale of Eversholt to HSBC, while John Prideaux made a similar sum from the sale of Angel Train Contracts to Royal Bank of Scotland.
A report from the Commons Transport and Environment Select Committee yesterday drove the point home, urging ministers to avoid the "extravagance" of their predecessors in spending large sums on consultancy.
Under Mr Prescott's proposals, the Tube's infrastructure and responsibility for maintaining it will be handed over to up to three private sector consortia. They will be responsible for track maintenance, station refurbishment, replacing rolling stock and maintaining signalling systems.
In return for investing in the modernisation of the network, London Underground will pay them an annual rental. The infrastructure contracts are likely to last between 15 and 35 years, with review every 10 years. Freehold ownership of the assets will remain in the public sector and the leasehold interest will revert to the taxpayer at the end of the contract. Responsibility for operating the system will remain with the public sector.
Mr Prescott hopes that the public-private partnership will be up and running by spring 2000. The 100 or so organisations that have registered an interest will be whittled down through a process of "market sounding" over the next month.
Bidders will be invited to pre-qualify in November or December and invitations to tender sent to shortlisted bidders early next year. The aim to is sign concession contracts by April 2000.
Outlook, page 13
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
Sony hack: Angelina Jolie branded 'seriously out of her mind' in further embarrassing leaked email saga
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
iJobs Money & Business
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...
$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...