London Underground

May I say how collectively sorry we are that the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) is not with us? I very much hope that the hon. Member for Liverpool, Riverside (Mrs. Ellman) will pass on my good wishes and doubtless those of colleagues on both sides of the House. There is no doubt that this PPP has been a catastrophic and expensive failure, as the hon. Lady indicated; it has also been an avoidable one. There is no doubt that some of the measures put in place to set up the PPP were flawed from the beginning, and I shall come back to some of them. The consequences are the one or two lines in the enormous tome produced by the Treasury that sets out the billions of pounds of taxpayers' money that has been necessary to deal with the problem that was unnecessarily created. The Secretary of State herself called the measure ““a terrible failure”” when she gave evidence to the Committee, and the hon. Member for Liverpool, Riverside rightly referred to the failure to deliver stations and track maintenance and to get anywhere near meeting any of the targets that were set for Metronet. It is worth going back to 1998, when the PPP was rushed through. Hon. Members may recall that at the time there was considerable uncertainty about whether the PPP was the correct course of action to follow. The Mayor, whatever else his faults, was clear that it was not the appropriate measure. He called the PPP ““inherently unworkable””. He even took High Court action—unsuccessfully—to stop it, whereas the Chancellor at the time, now Prime Minister, talked about the PPP in glowing terms, saying that it would remove the need for public subsidy entirely, which reminded me of the suggestion that nuclear power might be too cheap to meter. Perhaps we should mind the yawning gap between the Government's policy platform and the drain down which public finances roll. This is the second debate today indicating a failure of the Treasury to get a hold on important financial matters. We had a debate on Northern Rock and now this debate on Metronet. Metronet has plenty of faults, but I want to come on to the Government, because they cannot escape the blame for the situation. The Government have even managed to alienate some of their supporters who were in favour of PPP or PFI schemes. Jeremy Warner, the respected economic journalist, wrote in The Independent that the justifications for the PPP that needed to be met"““seem to have been largely trashed by the experience of Metronet””." One of them was that"““the private sector is likely to invest the money more efficiently than the state and so achieve a cheaper end result.””" It is difficult to see how that has applied in the case of Metronet. Jeremy Warner also spoke of the PPP's sharing the risk of a cost overrun, which is difficult to justify in this case, given that London Underground has been landed with 95 per cent. of the debt. The Liberal Democrats do not take the dogmatic view that PPP is always the right solution or always the wrong solution. I disagree with the Committee's absolute hostility to it, although I would add that the Government's trust and confidence in it has not been borne out by reality. As late as 18 July last year, the Prime Minister was still saying—in response to a question from my hon. Friend the Member for Twickenham (Dr. Cable)—"““If Metronet pulls out, another company will be found to take its place””.—[Official Report, 18 July 2007; Vol. 463, c. 276.]" That was clearly the Government's preferred model at that stage, but of course it has not been possible to implement it.