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Tube Lines and LU in battle over upgrade costs

Tube Lines and London Underground (LU) were this week locked in a bitter dispute over the cost of upgrade work on the Victoria, Jubilee and Northern Underground lines.

The row follows a freedom of information request by Tube Lines for LU costs for Victoria Line upgrade work, which Tube Lines said reveals massive cost escalations. LU is now responsible for this work following the collapse of Metronet.

However, LU has fiercely hit back at Tube Lines and accused it of “deliberately and willfully misinterpreting the data”.

Tube Lines told NCE that the information on overall project costs shows that over the past six months the cost of the Victoria Line upgrade had risen to three times the £4.5M/km figure that LU claims is the true cost of the project.

By contrast, Tube Lines argues that its upgrade of the Jubilee and Northern Lines is costing £10M/km.

Ongoing disputes

LU and Tube Lines submitted project costs to PPP Arbiter Chris Bolt, which led Bolt to order Tube Lines to cut its costs. He rejected the £5.75bn it had asked for and instead said the contractor could spend £4.4bn over the next seven and a half year review period (NCE 7 January).

Tube Lines rejected the order and is appealing for Bolt to look closer at LU’s costs.

“The costs for the Victoria Line are an important input into the Arbiter’s consideration [for what Tube Lines can spend],” Tube Lines commercial director Andrew Cleaves told NCE. “We have concerns about comparability. These things can make millions of pounds of difference − they’re very important.”

An LU spokesman said that Tube Lines failed to make a fair comparison by taking the whole project costs and ignoring core costs, which are more comparable.

Readers' comments (1)

  • It would seem that having mis-managed Metronet and encouraged them to walk away, LU are now intent on achieving the same result with Tube Lines.

    Never mind, at least that will allow them to return to the cosy public service model of delivering minimal service at maximum cost, secure inthe knowledge that for the majority of customers there is no alternative.

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