Transport for London has formally bid to take over collapsed tube maintenance company Metronet it has been announced.
The company collapsed earlier this year after it failed to secure an increase of £551 million in the money paid to it by London Underground. Chris Bolt, the statutory Arbiter for the London Underground PPP Agreements, decided that the company was entitled to just £121 million extra.
Under TfL’s plans staff and and assets of the two Metronet companies, BCV and SSL, will be transferred into two Transport for London nominee companies, which will be managed on a standalone basis whilst the long-term structure is agreed with the Mayor and Government.
London Underground Managing Director, Tim O’Toole said “In dealing with the collapse of Metronet, and through the Administration process, we have had two key priorities. First, to ensure the continued safe and reliable operation of the Tube network for passengers. That has been achieved and I would like to pay tribute to the hard work and dedication shown by all Metronet and London Underground staff, as well as the Administrator and his team. We need to continue to work together for passengers.
“Secondly, once under Transport for London control, we seek to put in place a stable, economic and efficient structure that is better able to deliver our investment priorities that will lead to increased capacity on the Tube in future.
“We strongly believe that the best and most robust way to achieve our ultimate goal is for an exit from the Administration process as early as possible. It is for this reason that we have now lodged our formal bid for Metronet, which I trust can be concluded as swiftly and efficiently as possible.”
Last month union demands for assurances on pensions and redundancies led to strikes by some tube staff.
Speaking in August One London leader Damian Hockney said “Londoners may very well find they’ve swapped one under-performing organisation for another that’s far worse.
“TfL, as a publicly-funded organisation, can never go into administration because it has a steady stream of taxpayers’ cash being pumped into it, which means it will never have any incentive to cut costs. If anything goes wrong, it just raises fares or increases its demands on the taxpayer.”