§ Mr. BrakeTo ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the level of(a) public and (b) private funding of London Underground from 1997–98 to 2001–02 using figures at 1997–98 prices. [100949]
§ Mr. Hill[holding answer 6 December 1999]: Figures are provided for the years 1997–98 to 2000–01. Figures for this year and next are plans/estimates. Levels of Government support for the Underground in 2001–02 have not yet been determined.
(a) The Government provide grant to London Transport for Underground and bus services, and not separately to London Underground Ltd.
Government funding for London Transport is as follows:
Grant to London Transport £ million Cash 1997–98 prices 1997–98 629 629 1998–99 411 401 1999–2000 740 705 2000–01 349 324 Note:
These figures reflect the position up to the end of October 1999, including the allocation of the 15 July additional resource package. They will need to be adjusted to take account of more recent decisions including the £50 million for bus initiatives announced on 15 November.
336WThis funding, together with LT's own revenues and investment through Private Finance Initiative (PH) deals (see following table), supports the following levels of investment in the Underground.
Investment in London Underground £ million Cash 1997–98 prices 1997–98 961 (485) 961 (485) 1998–99 751 (468) 733 (457) 1999–2000 803 (531) 765 (506) 2000–01 753 (535) 700 (497) Note:
Figures in brackets represent Underground investment excluding the Jubilee Line Extension.
(b) LT have made the following estimates of the value of investment provided through the PFI. The figures show what would have been the cost to LT if they had made the investment themselves. The actual cost of the investments to the companies concerned is not available.
Value of PFI investment in London Underground £million Cash 1997–98 prices 1997–98 161 161 1998–99 53 52 1999–2000 179 171 2000–01 150 139 LT resources have been supplemented by the following contributions from third parties:
Developer contributions £ million Cash 1997–98 prices 1997–98 31 31 1998–99 22 21.5 1999–2000 — — 2000–01 65 60.4
§ Mr. BrakeTo ask the Secretary of State for the Environment, Transport and the Regions if he will make a statement on the Government's plans for the central funding of London's Underground over each of the next five years; and if he will list the figure for investment in each year in real terms. [100950]
§ Mr. Hill[holding answer 6 December 1999]: The Government provide grant to London Transport (LT) and not specifically to the Underground. LT have been allocated Government support of £349 million for 2000–01. Some of this funding will be transferred to the Mayor in July next year, when Transport for London assumes responsibility for LT activities other than the Underground.
Levels of government support for the London Underground (LU) in 2001-02 and thereafter have not yet been determined. They will depend on: the extent to which bidders for Public Private Partnership (PPP) contracts improve on the public sector comparator; 337W decisions on the level of Government funding to be taken following the 2000 spending review; and decisions on funding and fares made by the Mayor for London.
Planned investment in the Underground in 2000£01 totals £753 million (£717 million in 1998–99 prices). This comprises investment of £535 million (£509 million in 1998–99 prices) in the core Underground and a projected £218 million (£207 million in 1998–99 prices) in payments to JLE contractors for investment that took place in previous years.
It is not possible to provide a breakdown of investment figures for 2001–02 and beyond. The PPP is designed to deliver around £8 billion worth of investment. PPP contractors will be required to implement a combination of specific projects and performance enhancements specified in terms of outputs to be delivered. Because the PPP contracts will require the delivery of service outputs, they will not generally specify particular works to be carried out or the amounts of money to be spent on them.
§ Mr. BrakeTo ask the Secretary of State for the Environment, Transport and the Regions what assessment he has made of the London Transport report of 1997 into options for London Underground; and if he will make a statement. [103562]
§ Mr. HillThe Government took account of LT's analysis in deciding on the Public Private Partnership route for London Underground. We published, and placed in the Library, a description of the facts and analysis underpinning our decision at the time.
§ Mr. BrakeTo ask the Secretary of State for the Environment, Transport and the Regions if he will list the Government and other reports compiled since May 1997 covering PPP, public interest companies, privatisation and other options for London Underground; if he will place them in the Library; and if he will make a statement. [103563]
§ Mr. HillPrice Waterhouse submitted a report on a variety of options for London Underground to us in 1997. London Transport also shared with us the analysis they had undertaken at that time. In order to avoid releasing material that would compromise our commercial negotiating position we published, and placed in the Library, a summary of the facts and analysis which underpinned our decision to proceed with the Public Private Partnership for London Underground in March 1998. PricewaterhouseCoopers produced a paper specifically comparing the PPP to a public sector bond-financed approach for us which was published, and placed in the Library, earlier this month.
§ Mr. BrakeTo ask the Secretary of State for the Environment, Transport and the Regions, pursuant to his answer of 6 December 1999,Official Report, column 431W, when he will report on London Transport's expenditure on external consultants up to the end of the first half of the current financial year. [103582]
§ Mr. HillI shall shortly be providing an up-dated figure for London Transport's expenditure on external advice for the London Underground public private partnership.
338W
§ Mr. LivingstoneTo ask the Secretary of State for the Environment, Transport and the Regions what account the Government took, in developing its proposed public-private partnership scheme for London Underground, of the bond-financed investment scheme set out in the report, "The Way Out—An Alternative Approach to the Future of the Underground". [103018]
§ Mr. HillThe Government considered fully a variety of options for financing the investment needed in London Underground, including issuing bonds as advocated in this report. We continue to believe that the Public Private Partnership approach will achieve best value for taxpayers.