London Underground (Hansard, 16 November 2001)

§ Mr. Pickles
To ask the Secretary of State for Transport, Local Government and the Regions what was the estimate of the interest charged to support the PPP for the London Underground at 1 October; and what is the current estimate. [13989]

§ Mr. Spellar
London Underground is currently negotiating the contracts to deliver this investment. To estimate at this stage of the negotiations what rate of interest the private sector infrastructure companies might be charged on the debt they raise would undermine London Underground's commercial position and jeopardise its ability to deliver best value.

§ Ms Buck
To ask the Secretary of State for Transport, Local Government and the Regions when he expects the Health and Safety Executive to complete consideration of the safety case for the PPP for London Underground. [14492]

§ Mr. Jamieson
The independent Health and Safety Executive is responsible for the timetable for consideration of London Underground's safety case. They will reach a decision after considering all the relevant issues.

§ Ms Buck
To ask the Secretary of State for Transport, Local Government and the Regions at what level of cost overrun under the PPP for the London Underground infracos will be able to demand additional financial support; and if he will make a statement. [14482]

§ Mr. Jamieson
The modernisation contracts provide for an "extraordinary review" if costs are increased by more than £200 million despite the infrastructure company carrying out the investment in an economic and efficient way. This is aimed largely at external events, which the infrastructure companies might be unable to bear and which could arise in any long-term contractual relationship.

§ Mr. Coleman
To ask the Secretary of State for Transport, Local Government and the Regions (1) how the budget for London Underground step-in inspection and maintenance powers will be set; who will be responsible for funding that budget; and if he will make a statement; [14518]
901W
(2) how long infracos will be allowed to comply with a notification of the need for safety works, before London Underground can invoke its step-in works to default powers under the PPP arrangements; and if he will make a statement; [14516]
(3) if he will make a statement on the arrangements that London Underground will have available to them to inspect the tube for safety concerns under the (a) proposed works in default and (b) step in powers process under the PPP arrangements; [14517]
(4) how many staff will be employed in (a) the inspection team and (b) the maintenance team available to London Underground to carry out its step in powers under the PPP arrangements: and if he will make a statement. [14513]

§ Ms Buck
To ask the Secretary of State for Transport, Local Government and the Regions if he will make a statement on the detailed arrangements under the works in default step-in powers for(a) notifying infracos of the need to take action on safety grounds and (b) performing works not carried out by infracos under the London Underground PPP. [14480]

§ Clive Efford
To ask the Secretary of State for Transport, Local Government and the Regions how disputes between Transport for London and infracos as to the exercise of step-in powers by London Underground will be resolved; and if he will make a statement. [14495]

§ Mr. Jamieson
London Underground will have a range of methods under the contracts for checking whether the infrastructure companies are carrying out their obligations. The contracts will require the private companies to provide asset management plans and detailed information on asset condition on an open book basis. London Underground will have rights to audit or inspect work and records at short notice.
Where London Underground finds a safety concern it will be able either to direct action from the infrastructure company or to step in itself, whether or not the infrastructure company has complied with its obligations. This step-in power allows London Underground to do the work itself or to employ an outside contractor or another infrastructure company. In either case, if the infrastructure company has breached its obligations, the work will be done at the expense of the infrastructure company that failed to meet its obligations. If action is determined by London Underground in these circumstances to be needed, it can be taken immediately with any disputes resolved later. In such cases London Underground does not need to give notice of its intended step-in.
It is for London Underground to determine the appropriate number of staff to be employed for inspection and step-in, and to set the relevant budgets.

§ Mr. Coleman
To ask the Secretary of State for Transport, Local Government and the Regions if he will deem approval by the HSE of the safety case for the London Underground PPP arrangements to be a guarantee that the PPP regime is safe: and if he will make a statement. [14519]

§ Mr. Jamieson
It is the responsibility of London Underground Ltd. under health and safety legislation to ensure safety on the underground network. It is the role of the Health and Safety Executive to assess and consider902W for acceptance London Underground's safety case, and to inspect for compliance as necessary. Acceptance of London Underground's safety case would mean that London Underground had made a satisfactory case under the Railway Safety Case Regulations 2000 to give confidence to the HSE that it has the ability, commitment, and resources to properly assess and effectively control risks to the health and safety of the public, staff and contractors.

§ Mr. Coleman
To ask the Secretary of State for Transport, Local Government and the Regions what proposals he has to request the National Audit Office to review, prior to the award of the contracts, the value for money of the proposed PPP for the London Underground; and if he wil I make a statement. [14514]

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions when he expects the NAO to report on the London Underground PPP; and if he will make a statement. [14485]

§ Mr. Jamieson
I refer my hon. Friends to the answer given to the Member for Truro and St. Austell (Matthew Taylor) on 12 November 2001,Official Report, column 503W.

§ Mr. Coleman
To ask the Secretary of State for Transport, Local Government and the Regions under the(a) actual and (b) proposed (i) contracts and (ii) understandings, what level of compensation will be payable to the infracos who have submitted bids for the PPP for London Underground in the event of the PPP Scheme being found not to represent value for money; and if he will make a statement. [14512]

§ Mr. Jamieson
No compensation will be payable to bidders in the event of bids for the modernisation plans for the underground being found to be not value for money.

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions what definition of a fair return on investment is being used for the private sector infracos investing in the London Underground PPP; and if he will make a statement. [14488]

§ Mr. Jamieson
I refer my hon. Friend to the answer given to my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) on 23 October 2001,Official Report, column 186W. The rate of return will be determined by the fair and rigorous competitions that London Underground are conducting.

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions what projections he has made as to fare increases after the London Underground PPP contracts are signed; and if he will make a statement. [14489]

§ Mr. Jamieson
I refer my hon. Friend to the answer given to the Member for North Essex (Mr. Jenkin) on 26 April 2001,Official Report, column 312W. Fare decisions on the London Underground are now a matter for the Mayor of London.

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions what assessment he has made of(a) the management structures proposals for London Underground PPP from the point of view of safety and (b) the conclusions reached by 903W Sir Desmond Fennell in his report on the King's Cross fire as to the management structure operated by London Underground. [14490]

§ Mr. Jamieson
As the Duty Holder under the relevant legislation, London Underground is responsible for ensuring that safety risks are reduced to as low as reasonably practical. The independent Health and Safety Executive is responsible for safety regulation of London Underground.

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions what contingency plans he proposes to put in place in the event of insolvency by one or more of the infracos in the London Underground PPP; and if he will make a statement. [14487]

§ Mr. Jamieson
The Greater London Authority Act 1999 contains specific provisions to protect the public interest should an infrastructure company perform poorly and be at risk of becoming insolvent (sections 220–224).

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions if he will indicate(a) for each year of the first seven and a half year period and (b) for the total of the first seven and a half years of the infraco contracts for the PPP of London Underground, what proportion of investment will come from (i) the private sector and (ii) the public sector; and if he will make a statement. [14484]

§ Mr. Jamieson
The plans for the modernisation of the Underground will deliver around £13 billion of investment to improve the underground's infrastructure over the next 15 years. London Underground is in the process of negotiating the contracts to deliver these plans. It is currently estimated that in the first seven and a half years some 25 per cent. of finance for these plans will be provided by the private sector, with the remainder coming from London Underground fares and Government grant.

§ Mr. Dismore
To ask the Secretary of State for Transport, Local Government and the Regions what discussions he has had with London Underground on the future membership of its board post PPP; and if he will make a statement. [14491]

§ Mr. Jamieson
The board of London Regional Transport is responsible for considering and approving appointments to the board of its subsidiary, London Underground Ltd. This responsibility will remain with London Regional Transport until London Underground Ltd. transfers to Transport for London.

§ Clive Efford
To ask the Secretary of State for Transport, Local Government and the Regions if he will make a statement as to the phasing of works under the London Underground PPP between different tube lines and between(a) stations, (b) track and signalling infrastructure and (c) rolling stock. [14494]

§ Mr. Jamieson
I refer my hon. Friend to the answer given to my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) on 18 July 2001,Official Report, column 195W. Bidders have said that in the first period of the Tube modernisation plans: over 60 miles of track will be repaired or replaced; over 500 carriages will be replaced or refurbished; over 50 stations will be modernised; new 904W signalling will be installed on the Northern and Victoria lines, with improvements elsewhere; and CCTV will be installed to improve security in trains and stations.

§ Clive Efford
To ask the Secretary of State for Transport, Local Government and the Regions if he will make a statement as to the guarantees under the London Underground PPP which will ensure(a) replacement and (b) upgrading of the tube infrastructure. [14498]

§ Mr. Jamieson
The public private partnership is designed to achieve a comprehensive modernisation of the entire underground network. The infrastructure companies will be contractually required to deliver specified upgrades of each line by dates set by London Underground. In addition infrastructure companies must meet specified levels for the condition of all underground assets, comply with London Underground standards and the requirements of their safety case.

§ Clive Efford
To ask the Secretary of State for Transport, Local Government and the Regions what discussions the Government have had with the National Audit Office over the value for money of the London Underground PPP; and if he will make a statement. [14493]

§ Mr. Jamieson
I refer my hon. Friend to the answer given to the hon. Member for Truro and St. Austell (Matthew Taylor) on 12 November 2001,Official Report, column 503W. My Department's officials have had numerous meetings with the National Audit Office on the value for money evaluation of the Government's plans for London Underground.

§ Clive Efford
To ask the Secretary of State for Transport, Local Government and the Regions if he will make a statement as to which risks will be transferred to the private sector under the London Underground PPP, and the extent to which those risks will be transferred. [14497]

§ Mr. Jamieson
In line with Treasury guidance, the Government's plans for the London Underground follow the principle that risks should be allocated to whoever is best able to manage them. The aim is not to transfer risk for its own sake, as this would lead to a decline in value for money, but rather to optimise the transfer of risk.