Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

MARKET FORCES

  • Comment
London Underground plans will not provide value, says report ...
London Underground plans will not provide value, says report

The government's plans to part-privatise the Underground have come in for renewed criticism, following the high court's decision to reveal a report which suggests the scheme does not provide value for money.

The report, from financial advisers Deloitte & Touche, says there is no evidence a private/public partnership will provide value for money, and the decision to pursue a 30-year contract is flawed because bidders were not required to submit firm prices for the whole period.

It adds: 'In compiling the public sector comparator, a number of adjustments have been made to the base costs provided by London Underground staff. These adjustments amount, in aggregate, to some£2.5bn.'

The report describes government changes as 'judgmental, volatile or statistically simplistic', and says public bond finance has been largely dismissed.

LU chairman and managing director Derek Smith said: 'It does little to further any informed debate. It is rushed, wrong and riddled with errors.'

The report had been kept secret by an injunction obtained by London Regional Transport and London Underground.

A spokesman for London Underground said: 'The Tube's legal team sought the injunction because the report contained confidential commercial information.'

Mr Justice Sullivan, who previously ruled against transport commissioner Bob Kiley and London Mayor Ken Livingstone's challenge to the plans, described the report as: 'A serious report by a serious player on a matter that is of very considerable public importance.'

Mr Kiley said the analysis of any public sector alternative was manipulated to make it appear more expensive.

US giant buys lobbyist GJW

A global advertising and communications organisation has bought GJW, a lobbyist with a large local government customer base.

The Interpublic Group of Companies Inc, based in the United States, has bought up True North Communications.

True North includes UK firms GJW and BSMG, which handle public affairs for local government. Interpublic owns lobbyist Shandwick.

A spokeswoman for Interpublic said: 'These companies will continue to operate independently although they have been acquired by Interpublic.'

School fires cost at record levels

The cost of arson is reaching record levels, council insurer Zurich Municipal is warning firms involved in school building projects.

The total cost of school fires will reach£87m this year and the firm is sending out an advice booklet to council architects, education departments and building contractors involved in the private finance initiative.

Larry Stokes, underwriting manager at Zurich Municipal, said: 'Those responsible

for design should seize

this opportunity to design schools more resistant to attack.'

PFI to provide learning centre

One of the first private finance initiative deals to be endorsed by two government departments has been signed by Sunderland City Council and Jarvis plc.

The Department for Education and Skills and the DTLR have approved plans to build a community learning centre in the city.

The centre will provide facilities for about 900 pupils and the deal is worth more than£50m over 25 years. The initial capital investment is around£21m.

During the life of the contract, Jarvis will provide a facilities management services including building and grounds maintenance, caretaking, cleaning, catering and security.

  • Comment

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions.

Links may be included in your comments but HTML is not permitted.