This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.
You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/6900360.stm
The article has changed 11 times. There is an RSS feed of changes available.
| Version 3 | Version 4 |
|---|---|
| Metronet is facing administration | Metronet is facing administration |
| (about 2 hours later) | |
| Tube maintenance company Metronet is facing the threat of administration unless there is a last-minute rescue. | Tube maintenance company Metronet is facing the threat of administration unless there is a last-minute rescue. |
| Metronet is part of a public-private partnership (PPP), which use private sector money to fund public projects. | Metronet is part of a public-private partnership (PPP), which use private sector money to fund public projects. |
| It had asked London Underground for £551m to cover extra costs to upgrade parts of the Tube system but instead was awarded £121m by the PPP regulator. | |
| Metronet said that its board would be meeting before making a statement either late on Monday or on Tuesday. | Metronet said that its board would be meeting before making a statement either late on Monday or on Tuesday. |
| 'Intervention' | 'Intervention' |
| "Metronet has been a disaster for its owners, WS Atkins, EDF, Balfour Beatty, Thames Water and Bombardier," the BBC's business editor Robert Peston said. | "Metronet has been a disaster for its owners, WS Atkins, EDF, Balfour Beatty, Thames Water and Bombardier," the BBC's business editor Robert Peston said. |
| "Unless there's a last minute intervention by the Treasury this morning, Metronet will go into administration today," he added. | "Unless there's a last minute intervention by the Treasury this morning, Metronet will go into administration today," he added. |
| "The losses for Metronet's lenders may run to hundreds of millions of pounds." | "The losses for Metronet's lenders may run to hundreds of millions of pounds." |
| Metronet is responsible for maintaining London's Bakerloo, Central, Victoria, District, Circle and Metropolitan tube lines. | Metronet is responsible for maintaining London's Bakerloo, Central, Victoria, District, Circle and Metropolitan tube lines. |
| The company had planned to invest £17bn over the next 30 years under a PPP scheme. However, it is estimated that there will be an overspend of as much as £2bn by 2010. | |
| Metronet has been embroiled in a battle over who should foot the bill. | |
| Transport for London (TFL), the transport authority that controls London Underground, said that the overspend was down to mismanagement and a failure to control costs by Metronet. | |
| Metronet has countered that TFL and London Underground have changed the specifications outlined in the contracts, asking for higher quality work and more expensive upgrades. | |
| All change | |
| Should Metronet go into administration, then there would be very little impact on consumers and travellers, London Underground said. | |
| Metronet is not responsible for the day-to-day running of the underground train system, and London Underground said it would look to ensure that services and maintenance carried on as normal. | |
| At the same time, Metronet would continue to function as a company, albeit run by administrators that would be appointed at a later date. | |
| However, one significant change would be that TFL rather than Metronet would probably be left to pick up the bill for any overspending on maintenance or renovation work, analysts said. | |
| The collapse of Metronet would also be a blow to the UK's new Prime Minister Gordon Brown as he pushed through the PPP for maintaining the Tube as Chancellor, the BBC's business editor said. | |
| Analysts added that the fate of the Tube's maintenance contracts, and whether they should be run by private or public companies, could become a hot political topic as Londoners are asked to vote for a new Mayor. |