The National Audit Office in Britain questions whether the partial privatization of the London Underground is good value for money. Under a P3 scheme, private consortia Metronet and Tube Lines took over tracks, tunnels and stations last year. Ticket offices and train operations remain in public hands.
Auditors have found the private companies could make up to 18 to 20 per cent profit. Despite this, the British government covered the companies costs of preparing their bids, totaling 250 million. When negotiations took longer than expected, the contractors raised prices by 590 million. In addition, the London Underground paid out consultation fees of over 100 million.
Given there is no assurance that services will improve, the assistant auditor general described the absolutely enormous numbers as not very positive.
Earlier in June, another semi-privatized transport service the National Air Traffic Service was beset by computer software problems that resulted in massive delays across Britain.