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Taxpayers lost up to £410 million due to the failure of Tube upgrade firm Metronet, a scathing report found today.
Britain's spending watchdog blasted ministers, London Underground and the company itself for the scandalous waste of public funds.
The National Audit Office concluded that the Metronet fiasco led to a direct loss to the taxpayer of between £170 million and £410 million.
The firm had been contracted to upgrade and maintain stations, tracks, trains, bridges and other infrastructure on ten lines under a public-private partnership. But it went into administration in July 2007 "predominantly because its poor corporate governance and leadership" meant that it could not manage its shareholder-dominated supply chain, according to the NAO.
This left the Department for Transport having to pay out £1.7 billion because it had effectively underwritten a guarantee by Transport for London for Metronet's borrowings.Gordon Brown was also criticised over his decision to part-private the London Underground.
Reader views (6)
£410 million loss, £1,7 million from the budget of TfL / LuL leading to the £2.4 billion cost cutting and the issues around next weeks strike.
Metronet failed because of profiteering why dont people look at how much they were charging for swopping a lightbulb or changing a tile? or how much money they were giving in salary to their bosses!!
TfL / LUL are doing better, ask the chiefs how much they have completed whilst its been in LU's hands.
- Steve, London, UK, 07/06/2009 08:31
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Taxpayers' £410m bill for Metronet - so who else was going to pay for it?
- Rogan, Irving, 05/06/2009 21:18
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The problem is that London Underground staff have a vested interest in making organisations such as Metronet fail and thereby bring all their colleagues back into TfL employ and into the RMT. Collusion, incompetence in scheduling work and poor management have allowed TfL to push all major contractors into loss making situations when in reality, TfL could do no better themselves. If Metronet had succeeded, them the RMT would have gradually been broken but not the RMT have largely won and any danger of their stranglehold being broken has gone for now.
- Graham, Fleet, 05/06/2009 14:59
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£240 million --> more expense claims?
- Josh, London, 05/06/2009 13:25
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Not flash, just gordon!
- Chris, Brighton, England, 05/06/2009 12:20
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"the Metronet fiasco led to a direct loss to the taxpayer of between £170 million and £410 million."
Excuse me, but there seems to be a variation of £240 million which has yet to be properly accounted for. Where did all our money go?
Yet another Gordon Brown PPI failure.
- Kate, London, 05/06/2009 12:13
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