With the greatest respect to this influential

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					   Transport
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                               Public Private Passengers
                                           ith the greatest respect to this influential     weeks and strengthened 130-year-old tunnels under

                               W           publication, and to its 20,000 well-
                                           informed readers, I would have preferred
                               not to be writing the article that you now see laid out
                                                                                            High Street Kensington inside 100 days. Without this
                                                                                            method of working, tens of thousands of Tube
                                                                                            passengers in south and west London would have
                               over the following pages. Not that I do not believe          faced delays and disruption lasting years not months.
                               passionately in every one of these words that sets out       There are also many other examples of how the public
                               our case for the long-running attempt to revitalise          and private sectors are working together to modernise
                               London Underground through partnership with, and             the 140-year-old system and bring real benefits
                               investment from, the private sector.                         for passengers. Witness the well-documented
                               It’s just that instead of outlining this case history, I     improvements to the Northern Line - the much-
                               would much rather be out on the Tube network, seeing         mocked ‘Misery Line’ of old - thanks to the provision of
                               what that massive £13bn cash injection would already         more than 100 new trains, built and maintained by the
                               have been doing to improve the lives of the three            private contractors Alstom.
                               million people using our service every day.                  Others in the series of wide-ranging private finance
               Derek Smith,    Forgive my frustration, but the fact that I am writing       initiatives are tackling key issues across the
                                                                                            Underground network, such as reducing congestion
               Chairman of     this in December 2001 underlines what an opportunity
                                                                                            and crime and improving train information and ticket
                               has been missed to transform public transport in the
                     London                                                                 machines. Already these joint enterprises have begun
                               capital, improve national network links and, by
               Underground     extension, to boost London’s economy and that of the
                                                                                            to bear fruit - encouraging indications for the new era
           argues that PPP     UK as a whole.
                                                                                            to come. In the last year alone, there have been four
                                                                                            million fewer transactions at station ticket windows,
             is the solution   I have no doubt that this transformation will happen,
                                                                                            thanks partly to new, improved machines that help cut
            for the London     hopefully starting within three or four months from
                                                                                            waiting and journey times for passengers. Meanwhile,
            Underground…       now. But two long years will have been wasted by then
                                                                                            another new British Transport Police station is under
                               - precious time that would have seen some £2.6bn of
                                                                                            construction - at Tottenham Court Road - further
                               the initial investment from private partners beginning
                                                                                            strengthening the resources of the force that has cut
                               to turn back the Tube’s long years of decay and delay.       pickpocketing crime to a record low.
                               This vital groundwork of renewing the tracks and
                                                                                            There is no question that these joint projects have been
                               signalling systems to deliver faster, more reliable trains
                                                                                            good for London Underground and therefore good for
                               and to ease congestion - the keystones to a better Tube
                                                                                            the people who have to rely on us, day in, day out, no
                               - should have been underway from April 2000. Now
                                                                                            matter what political posturing is taking place
                               we are still waiting to see whether a start can finally be
                                                                                            off-stage.
                               made in April 2002.
                                                                                            Just think, though, how much better things might
                               That is particularly galling when during that time,
                                                                                            have been by now had we had been allowed to get on
                               opponents of the PPP will have seen key renovation
                                                                                            with the job rather than waste time and money on
                               projects - forerunners for the publicly run, privately
                                                                                            High Court cases. Instead, in December, rather than
                               built Tube - delivered on time, on budget and -              preparing for a third year of investment, we found
                               most significantly - making a real difference to the         ourselves merely hoping to complete commercial
                               travelling public.                                           negotiations and receive final prices from the
                               Under the supervision of the Infracos - infrastructure       preferred bidders. The investment plans were then to
                               companies that are crucial cogs in restructuring the         be scrutinised to establish whether they offered
                               way London Underground will be run - engineers,              value for money - a consideration second only to
                               managers and construction workers combined to                safety in what will be the world’s biggest underground
                               replace a 30-year-old crossover at Brixton in three          renewal programme.


    100
                                                                                                                                               Transport
                                                                                                                                            and Logistics
                                                            q   Infrastructure - competitively tendered private
                                                                sector contracts to go to Infracos, which would
                                                                invest in, maintain and modernise the network.
                                                                Bonuses would be paid for work certified and
                                                                completed ahead of schedule; penalties incurred
                                                                for failure to deliver on time or for asset failures
                                                            This division of operations and infrastructure and the
                                                            inclusion of maintenance within the management of
                                                            ‘infrastructure’ were clearly envisaged when the
                                                            Deputy Prime Minister made his announcement.
                                                            It was these specific issues that were to become
                                                            significant points of difference between the pro and
                                                            anti PPP lobbies over the following three years.
                                                            While opponents of the PPP mounted their campaign,
                                                            London Underground carried on doing what was in the
                                                            best interests of the people that matter most: running     ‘Without this
By now, the process should have advanced to the next        the service for the passengers, despite what was            method of
stage, with a further top-to-bottom review of the
                                                            happening ‘above ground.’                                   working, tens
objectives, and culminating in a ‘final’ decision in
January 2002. At that point, the contracts could be
                                                            Efforts were also continuing to hone the PPP process.       of thousands
                                                            Early in 1998, we started work on the detailed design
signed and would be expected to take effect some two                                                                    of Tube
to three months later - perhaps hitting that April date     of LUL and the Infracos and began appointing teams of
                                                            key advisers. Later that year we took market soundings
                                                                                                                        passengers in
mentioned earlier.
                                                            and hosted an industry conference into how best to          south and west
Two other dates play a significant part in the whole
PPP process which has been set out publicly in great
                                                            implement the PPP.                                          London would
detail over the past four years. One relates to London      This feedback indicated a preference for three separate     have faced
Underground’s problem and the other to a solution           Infracos as the best way forward for a better service.      delays and
that we believe will deliver the safe, quick, clean,        Other options were evaluated but the preferred model        disruption
reliable Tube network London demands and deserves.          stood up best to a series of rigorous tests.
                                                                                                                        lasting years
The first is 9 January 1863 - birth of the world’s first    By early 1999, the key PPP structure was in place and
underground railway - and a daily reminder that many
                                                                                                                        not months.’
                                                            from then on, the workload and the pace increased.
of the problems we face in the 21st Century stem from       Initial bids were invited for the Deep Tube lines;
failure to improve a railway built largely in the 19th
                                                            ‘shadow running’ began - detailed preparation for
Century. In time, the second date might prove just as
                                                            transfer to the private sector; service contracts were
significant: 1 May 1997, when with the election of a
                                                            signed; and preferred bidders were eventually
new Government, there was a public commitment to
                                                            announced for the three separate Infracos: the deep
tackle the ‘historic problem of under-investment in the
                                                            Tube lines JNP and BCV and the Sub-surface lines (SSL).
Underground.’
                                                            Looking back over that potted history of the PPP serves
That statement was contained in the Labour Party’s
                                                            only to increase my frustration at the blocks that have
election manifesto, referring to plans for a new public
                                                            been put in the way of putting real pounds in the
private partnership to improve the Tube, safeguard its
                                                            ground to rebuild the Underground.
commitment to the public interest and guarantee
value for money to taxpayers and passengers.                In short, this process has been subjected to repeated
Immediately after the General Election, the structure       and stringent analysis from teams of professionals,
of the PPP began to take shape and within 12 months,        expert in many fields but with one sole aim: to create
Deputy Prime Minister John Prescott, then also              the best Tube that money can buy - not to put profits
Secretary of State for Transport, had outlined the PPP      before passengers, or leave safety lagging behind          Derek Smith
                                                                                                                       Chairman
plans in a Commons announcement. In effect, the PPP         performance.
                                                                                                                       London Underground
would comprise two elements:                                Hopefully, this year we will finally be allowed to         55 Broadway
q
                                                                                                                       London SW1H 0BD
    Operations - a single, integrated entity, retained in   achieve that goal. If so, all the hard work will have
                                                                                                                       Tel: 020 7222 5600
    the public sector and responsible for running the       been worth it; if not, the Tube’s quickest line to         Fax: 020 7918 3134
    Underground services                                    improvement will have been blocked yet again.              www.thetube.com


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