GOVERNMENT OFFICIALS were expected to meet with London's Transport Commissioner Bob Kiley this week to head off a threatened legal challenge to the privately funded upgrade of the Tube.
London Mayor Ken Livingstone last week increased pressure on the Government to scrap the Public Private Partnership project by threatening seek a judicial review when contracts are awarded.
A judicial review could force the Government to rethink the PPP plan, delaying the urgently needed Tube upgrade.
Kiley objects to Government plans to hand Underground infrastructure to the private sector for 30 years, while allowing Transport for London to retain control of station staff and train drivers.
He hopes to persuade Prescott to combine responsibility for station staff and drivers with infrastructure renewal work as part of a compromise over the future of the upgrade work.
It is unclear whether Kiley will push for a change in the way private finance is used to fund the upgrade, although it is thought likely the project will still go ahead under the PPP banner.
'PPP can be anything you want it to be, ' said a source close to Kiley.
Irving Yass, director of policy and transport at business lobby group London First, said he expected Kiley and Prescott to thrash out a compromise. He described the original PPP contracts as 'untenable'.
Kiley is understood to be recruiting a team of subway experts from the US to integrate into the existing Transport for London management.
His team is expected to include engineers who worked with him on the Boston and New York subway upgrades.