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Low payment puts Metronet BCV on the brink

Metronet BCV, the firm responsible for the refurbishment of the Bakerloo, Central and Victoria London underground lines, faces an uncertain future after receiving £430M less in Interim Infrastructure Service Charge (ISC) payments than it had asked for.
The PPP Arbiter today approved the payment of £121M over the next 12 months to Metronet BCV in a draft ruling. Metronet had asked for £551M. Metronet had asked the Arbiter to award it the extra cash to help it pay for cost overruns on the on-going upgrade of the Bakerloo, Central and Victoria lines. Metronet's failure to get what it wanted from the Arbiter has led to speculation that Metronet BCV, could be forced into administration.PPP Arbiter Chris Bolt justified his ruling. 'I have concluded that this increased ISC is at the appropriate level for an efficient and economic company performing in line with good industry practice,' said PPP Arbiter Chris Bolt.Metronet last week called for an 'extraordinary review', claiming £992M from London Underground for cost overruns.The arbiter's final decision will be published on 31 July'Metronet Rail BCV will respond more fully to the Arbiter's draft Interim Directions shortly, as soon as it has assessed the full impact on its business,' said a Metronet spokesperson.Metronet usually receives £337M per year from London Underground for its BCV business. The cash awarded today should therefore give an additional four months' funding.

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