Tangled web at Metronet

OUTRAGEOUS, SCANDALOUS, disgraceful... are a few of the printable words to describe the government's £2 billion bail-out of Metronet - the failed London Underground infrastructure company.

Simon Carter

Metronet (comprising five allegedly 'world class' companies as shareholders - Atkins, Balfour Beatty, Bombardier, EDF and Thames Water) was awarded the franchise to maintain and improve two-thirds of the Underground network under Gordon Brown's 'public-private partnership' (PPP) venture. (The other 'third' is maintained by Tube Lines consortium.)

PPP was meant to be a cost-effective way of improving the Tube without involving large sums of public money. In reality, like all PPP and PFI privatisation schemes, it meant private profits paid for out of public funds.

Under PPP, Metronet received about £70 million a month of government money, pocketing about £1 million a week in profits. But still it ran out of cash, forcing it into administration last July. Under the 2003 PPP contracts, the government effectively guaranteed 95% of Metronet's borrowings.

In July 2007 a London Underground Central Line train was derailed, trapping 800 passengers underground for about two hours. Passengers feared they were victims of a terrorist attack. In fact they were victims of gross negligence by Balfour Beatty, one of the companies working under Metronet. The company had stored some equipment badly and it had come loose, falling across the track.

Another problem arising from the Underground's fragmentation is that Metronet's signalling equipment on tracks and trains - contracted to Bombardier and supplied by Westinghouse - is not compatible with equipment from Alcatel, a rival, for Tube Lines' track and trains.

Metronet's failure and the unwillingness of other private sector companies to take on the task of tube track maintenance, has led to Metronet being taken back into the public sector under the wing of Transport for London (TfL- the London mayor's transport organisation),

Arguments between Bombardier and TfL over Bombardier's contract with Metronet, have delayed the transfer.

Last April, rail union RMT members working for Metronet balloted for strikes to stop the transfer of their posts to Bombardier. The threatened action forced Metronet to back down.

The Metronet fiasco further exposes Brown's support for privatisation and New Labour's belief that private profit is the way to provide public services.

The only way London Underground and the national rail networks can ensure proper investment and a safe and reliable service, is if they are taken back into public ownership and democratically run under workers' control and management.