Railtrack gets head start in PPP race
In return for a promise not to bid for London Underground's deep tube lines, Railtrack has won exclusive rights to negotiate to take over the sub-surface lines which share a common loading gauge with its network. Announcing the deal on June 15, Deputy Prime Minister John Prescott said 'for many years I have advocated linking the national railway with the Underground to make it easier for the public to travel to, from, within and across London.'
On June 21 London Transport invited firms to prequalify for 25 to 30 year concessions to manage infrastructure and trains on three networks - two covering the small-profile tubes and one the sub-surface lines. LU is forming three 'infracos' for the successful bidders to take over next year, but will continue to staff trains and stations and carry the revenue risk.
A shortlist of six to eight groups will be invited to tender for the tube infracos in the autumn. Bids will be expressed in terms of payments required from LU for overcoming a £1·2bn investment backlog, and then maintaining the assets in good order. Collectively, the three concessionaires would be expected to invest £7bn in asset renewal over the first 15 years, but the bill for Railtrack would be much higher because additional cash is needed to join up main lines with the Underground.
Prospective bidders told the government that they were unwilling to invest in a costly bid preparation where Railtrack was able to exploit its unique position. But LU stressed that Railtrack would only get the sub-surface infraco 'if a value for money solution were found' to the creation of integrated routes.
Without consulting LU, Railtrack developed elaborate plans to use the Circle line as a substitute for the aborted Crossrail tunnel to join up Paddington and Liverpool Street (RG 1.92 p34). Though details were only published in the vaguest terms, LU effectively dismissed this notion as impractical. However, an Undergound-style service might be introduced between Heathrow airport and the City of London.
What LU really wants to see is Railtrack funding its long delayed plan to develop the East London line into a third north-south route, parallelling the overloaded Thameslink line 3 km to the west.