LONDON Underground could be sold after a general election expected on May 1, although a memo from Transport Secretary Sir George Young to Prime Minister John Major warns that it will be ’a unique and very difficult privatisation to sell to the public’. Higher subsidies required to clear an investment backlog by 2002 could be ’greater than the net sale proceeds’.
The Commons Transport Committee heard on February 19 that higher funding since 1987 had cut LU’s renewal backlog from £2bn to £1·2bn, but it would rise to £1·5bn by 2002 if cuts in grant announced last November were not reversed.
Aggravating the situation is a £499m over-run on the Jubilee Line extension, now expected to cost £2·64bn. Although the government is providing an extra £100m to cover a 6 month standstill on NATM tunnelling, LT told the MPs that ’funding for the next three years is around £700m less than we had anticipated.’ o