BusinessBusiness RecoveryBig Four firms used to damn Metronet

Big Four firms used to damn Metronet

Transport minister claims Ernst & Young and KPMG help support PPP policy and prove Metronet at fault for Tube troubles

KPMG, Ernst and Young and the NAO are being cited by the government to prove

Prime Minister – then chancellor – Gordon Brown was right to insist on the
disastrous Metronet PPPs to maintain and improve a large part of London
Underground.

Transport minister Rosie Winterton told a critical Commons debate: ‘The
failure of the Metronet PPPs is a corporate failure, not a failure of the
PPP contracts.’

Winterton insisted the principles on which the PPPs were based ‘were
rigorously tested as the PPP proposals developed.

‘Considerable time and effort were expended in understanding the comparative

value of the PPP versus conventional public sector-led procurement.

‘That work, based on the public sector comparator, was independently
scrutinised by KPMG and Ernst and Young, and subsequently the NAO. Both
found the methodology to be robust and fit for purpose.’

She conceded the government ‘certainly recognise that Metronet has failed’

but insisted it was Metronet’s failure to deliver satisfactorily on track
renewal and station upgrades and control costs ‘that ultimately led to its
collapse’.

She claimed: ‘The PPP secured significant additional investment at a time of

many competing priorities for the public purse.’

Other contributors to the debate were less convinced.

Liverpool MP Luise Ellman, opening the debate in place of
Transport committee chairwoman Gwynneth Dumwoody, recovering from an
illness, said the ‘catastrophic financial failure’ came with ‘a £2bn
price tag’.

Lib Dem MP Norman Baker said the original contract was ‘flawed’ and
‘difficult to defend’.

And Tory accountant MP Justine Greening, Putney, blamed London mayor Ken

Livingstone, Metronet and Gordon Brown for the collapse.

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