The PPP Agreements

London Underground Limited (LUL) entered into three separate Public Private Partnership (PPP) Agreements, with Tube Lines in December 2002 and with Metronet (two separate agreements) in April 2003. Under these PPP Agreements, three private sector companies (Infracos) maintain, renew and upgrade discrete parts of LUL's infrastructure under separate 30 year Agreements. LUL remains responsible, in the public sector, for delivering services to customers.

What the PPP delivers

The programme of works delivered under the PPP Agreements is long term, scheduled to be carried out over 30 years. In this period the Infracos will deliver:

• a line upgrade (new trains and or signaling) on every line except the Central line (where existing trains and signalling may not need to be replaced in the life of the PPP)*;
• an extensive station modernisation and refurbishment programme;
• improved understanding of the condition of all of LUL's assets; and
• recovery of a backlog of underinvestment in LUL's infrastructure assets.

In the first Contract Period of 7½ years (Review Period) the Infracos focus on reliability improvements, station works and Line upgrades which are long term projects generally spanning the first and second Contract Periods.

In addition to capital intensive projects the PPP performance regime incentivises the Infracos to improve the quality or ambience of the travelling environment and improve the reliability of the Underground assets. There are a number of metrics in this second area, the most important of which is ensuring that trains and stations are available for use; the availability measure.

Line Upgrades

Although delivered during the second Contract Period the Infracos are already well advanced on several line upgrade projects, i.e. for Tube Lines the Jubilee and Northern lines; and for Metronet the Victoria and Sub-Surface lines. The lead time for these projects is necessarily long but the Agreements anticipate that certain milestones will be met within the first Contract Period.

The diagram below illustrates the timings of the various line upgrades. Both the Central line initial improvements and the interim Victoria line upgrade are close to completion. Significant work was also undertaken on a closure of the Waterloo and City line over the summer of 2006.

Station Works

In the first Contract Period the Infracos are also scheduled to deliver a station modernisation and/or refurbishment at most Underground stations. The chart below illustrates the number of station modernisations and refurbishments due to be delivered during the first Contract Period:

Other Works

Under the PPP Agreements LUL also retained "specified rights" to require the Infracos to undertake works in certain areas that could not be fully described and therefore priced as part of the bidding process.  In the case of Tube Lines a number of specified rights have been exercised by LUL, including one for the delivery of an extra trailer car for every Jubilee line train (completed on time in December 2005) and two, to deliver works in relation to the extension of the Piccadilly Line to Heathrow Terminal 5.  A number of specified rights have also been exercised for Metronet SSL, including the installation of air conditioning on the Sub-surface lines and the increase of the Circle line to a seven car service as part of the line upgrade.  A single specified right has been exercised for Metronet BCV relating to power upgrades.

In addition to these specified rights all Infracos have been undertaking congestion relief and/or step free access programmes at a number of stations.  In particular, Tube Lines has been undertaking significant works at Wembley Park, in preparation for the opening of the new Wembley Stadium.