Tube commuters hit by £1bn bill for Metronet collapse

Work to improve the network, used by 3.2 million people a day, could be drastically cut back to help pay the bill.

The move will infuriate Mayor Ken Livingstone, who has repeatedly condemned Metronet for failing to do the job properly. Transport for London (TfL) responded by saying it was "adamant" fare and taxpayers would not foot the bill.

The station improvement programme will be one of the first casualties as work is reduced.

Chris Bolt, arbiter of the Tube's public-private-partnership (PPP) ruled today that Metronet is due anything between £ 370 million and £1070 million for extra work over and above that specified in the first seven and a half years of its 30-year contract.

Metronet went bust in August as spending soared. It originally demanded more than £2 billion for the extra work - a claim robustly denied by TfL. The consortium-is now in administrationand being run by TfL as "caretaker" manager.

Metronet was responsible for maintaining and improving two thirds of the Tube network including the Circle, District, Bakerloo, Central and Victoria lines.

TfL is submitting a formal bid to take over the Metronet contracts. Mr Bolt today published his "initial thoughts" into how much Metronet could be due.

He said an "appropriate figure" for the Bakerloo, Central and Victoria lines could be anything between £140 million and £470 million.

For the sub-surface Circle and District lines, the figure rises to between £ 230 million and £600 million, meaning a total of up to £1.07 billion.

Mr Bolt said he had reached his preliminary analysis following submissions made by Metronet and London Underground. He expects to conclude final costs mid-November. A TfL spokesman said: "We are at a loss to understand how and why the arbiter has produced these figures. It seems he has made a purely hypothetical judgment on the finances of Metronet had it continued to run and become an efficient and viable company.

"Given it is currently languishing in administration, we cannot see how he (Mr Bolt) has made that judgment."

But a senior Metronet source said: "These figures show that a substantial part of our claim for extra money for extra work was correct.

"LU has said all along that it did not order extra work - that has also been shown not to be true. LU, and the Mayor, have and continue to play a political game over this whole affair."

Metronet's four years in charge have been dogged by administrative, financial and engineering failures.

There have been frequent delays to night engineering work - which meant the lines did not open in time for the morning rush hour. Two years ago there was chaos because Metronet did not carry out maintenance to prevent tracks expanding in the summer heat.

Metronet was also forced to admit responsibility for the Central line derailment near Mile End because one of its shareholder partners, Balfour Beatty, left a huge roll of fire blanket too close to the track.

However, Metronet's selfinflicted troubles will be a boost for the Mayor as he continues to "save" the Tube during his campaign for re-election next year.

The legal moves for administration guarantee that Metronet's 5,000 staff, and its many suppliers, will continue to be paid. Up to 2,000 work on the tracks and in the tunnels every night maintaining the system.

Metronet initially applied for an interim payment of £551 million, but Mr Bolt, awarded just £121 million and judged that Metronet was itself mainly responsible for the overspend.