From the Guardian Weekly, Jan 8-14, 2004:
“Private Tube firms fined £32m in the first year of PPP”
“Travellers on the London Underground have suffered a collapse in the network’s reliability since its part privatisation a year ago, with private contractors being heavily fined for failing to deliver on their commitments. Internal London Underground(LU) documents reveal that the Government’s public private partnership(PPP) has had a disastrous start.
“Tube Lines and Metronet, the two consortiums that took over the network, have been handed £1.2 bn of public money to invest in the infrastructure. But since they signed the PPP they have been fined £32m for failing to hit benchmarks, while receiving just £12m in bonuses for reaching targets.
“Under the PPP, Metronet and Tube Lines have 30-year leases over the Underground’s infrastructure and are responsible for maintenance and modernisation. But LU, which remains in public ownership, still operate trains and stations.
“LU’s chief programmes officer, Bob Janowski, said: ‘Where we are right now is not where we’d like to be. Some of these figures are a surprise to me and to us. I thought they would have been better.’ According to LU’s internal figures, the number of train failures every month jumped by 23% in 2003. Track problems have risen by 20% to 76 a month and points failures are up by 38% to 46 a month.
“The general secretary of the Rail, Maritime and Transport union, Bob Crow, described the figures as “abysmal” and called on the Government to follow Network Rail’s example by taking all maintenance on the Underground system back in-house.
“Experts said the progress of the PPP would have huge implications for the future of the Government’s policy of using private finance to raise funds for health, education and other public services. Other deals that have run into trouble include the part privatisation of air traffic control, which had to be rescued by an emergency refinancing last year.
(see paragraph 2 - paid bonuses for _reaching_ targets...I thought that was the point of a contract. Bonuses for _exceeding_ targets maybe, but _reaching_ them? Break out the $400 hammers, and Haliburton-priced gas...)
Does anybody know of anything that Tony Blair has actually done right? His take-over of Labour more and more resembles Brian Mulroney’s take-over of the PC’s, distorting each into something requiring time to recover from. Let’s hope Labour has more success than the PC’s.