Metronet (British infrastructure company)

Following a two-year bidding process,[12] Metronet and Tube Lines were selected as the preferred consortiums in May 2001.[13]

In April 2003, Metronet began to maintain, upgrade and renewal London Underground infrastructure as part of the PPP.[9] Metronet Rail had been the successful bidder for the two 30-year contracts for the following tube and sub-surface lines:

• BCV (tube) lines contract: Bakerloo, Central, Victoria and Waterloo & City lines.
• SSL (sub-surface) lines contract: Circle, District, East London, Hammersmith & City and Metropolitan lines.

Tube Lines, held the contract for the other London Underground lines – Jubilee, Northern and Piccadilly. Both Metronet and Tube Lines were colloquially referred to as "infracos".[13] Contracts were worth around £17 billion over the 30-year period, with each contract receiving around £660 million each month from the Government, albeit with reductions if targets are not met.[14]

Under the terms of the PPP contracts, Metronet agreed to maintain London Underground infrastructure (track, trains, tunnels, signals, and stations) to the standards and performance levels set in the contract. Furthermore, Metronet committed to delivering substantial improvements to the network, by refurbishing, upgrading and renewing track, trains, tunnels, signals, and stations. To encourage high reliability, deductions suffered for poor performance were set at twice the rate of increase in revenue for improved performance.[2][9]

At a cost of £7 billion, Metronet promised substantial investment during the first 7.5 years of the contract (2003 to 2010):[2]

• 147 stations (including lifts and escalators) modernised or refurbished by 2012
• 127 miles (204 km) of track renewed and 166 points/crossings replaced
• Upgrade and refurbishment of tunnels, bridges, embankments, track drainage and other civil structures
• Refurbishment of existing rolling stock, as well as making them more reliable
• 47 new trains with upgraded signalling on the Victoria line by 2012 (delivered as 2009 Stock)
• 190 new air conditioned trains for the District, Circle, Hammersmith & City and Metropolitan lines by 2015 (delivered as S Stock)
• 24 new Bakerloo line trains by 2019 (cancelled following the collapse of the PPP)

From 2006, Metronet used five Class 66 locomotives from GB Railfreight to help speed up track replacement works

In June 2004, the National Audit Office criticised the complexity of the PPP deals, noting they offered "the prospect, but not the certainty" of improvements.[15] In August 2004, Metronet was declared at fault by an accident investigators' report into a May 2004 derailment at White City, for failing to implement sufficient safety checks despite being ordered to do so by TfL.[16][17]

In March 2005, the House of Commons Transport Select Committee noted that "Availability is the most important factor for Tube travellers. All the infracos needed to do to meet their availability benchmarks was to perform only a little worse than in the past. On most lines, they did not even manage that."[18] In March 2005, the House of Commons Public Accounts Committee, charged with ensuring value for money in public spending, published a report concluding that it was "impossible to determine" whether the PPP was better value than a publicly run investment programme.[19]

In April 2005, the Commissioner of Transport for London, Bob Kiley, pressed for an urgent review of the PPP, describing its performance as "bordering on disaster". TfL also said that new technology promised by Metronet had yet to be seen — "We were supposed to be getting private sector expertise and technology with the PPP (Public Private Partnership) but instead they are just using the same old kit."[11] A week later the chief executive of Metronet was sacked,[20] after complaints that it had made £50 million profit despite being behind on all its major works.[21] By April 2005, it had started work on only 13 station refurbishments, instead of 32 as scheduled, and was more than a year behind on the refurbishment of 78 District line trains. It was also behind on its track replacement programme, having completed 28 km of the anticipated 48 km.[22]

In November 2006, Metronet were heavily criticised by the arbiter of the PPP, the Office of Rail Regulation (ORR) over their performance from 2003 to 2006.[14] Analysis included criticism that Metronet had not performed in an economic or efficient manner, and had failed to follow good industry practice. The ORR also stated that Metronet would be held responsible for £750 million in cost overruns.[14][23] The other PPP consortium, Tube Lines, noted that they were delivering projects on time and on budget.[10]

In July 2007, Metronet admitted that it may have caused a Central Line train derailment near Mile End, in which a train hit a fire blanket left by maintenance workers.[24][25]

In April 2007, Mayor Ken Livingstone stated that Metronet could collapse due to a £750 million overspend.[26] In July 2007 it was reported that Metronet was "teetering on the brink of administration".[27] The situation arose because it had received only £121 million out of the £551 million it needed to cover cost over-runs. By contrast, Tube Lines, the other PPP consortium, had brought in almost all of its works on time and on budget.[28] On 18 July 2007, the company was placed into administration.[6][3]

To enable its business activities to be kept going while the winding-up of the company was in progress, the UK Government provided Metronet with £2 billion in 2008.[29] Following negotiations with Bombardier, Metronet modified contracts to allow for continued delivery of 2009 Stock and S Stock trains, while releasing Bombardier from its obligation to resignal the sub-surface lines.[4]