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The battle between London mayor, Boris Johnson, and the Tube Lines contractor is heading towards arbitration. Talks between Tube Lines, the public-private partnership, and London Underground (LU)– backed the by the mayor – have reached deadlock over delays and future costs. Tube Lines, the last contractor overhauling part of the Tube network, had requested extra time to complete work on the Jubilee line, which was vetoed by Mr Johnson. Dean Finch, chief executive of Tube Lines, said: ‘We don't think we will quite get there in December. And we will pay the price for that lateness. It is not the taxpayer who pays for that, it is us.' The firm is jointly-owned by US engineering group, Bechtel, and Amey, a UK support services group. Talks have also been continuing over the next seven years' of costs, which will begin in July 2010. London Underground has decided to refer the issue to arbitration, despite claims by Tube Lines that an agreement had been reached to cut £1.5bn of costs. London Underground's acting managing director, Richard Parry, claimed the negotiations had reached an impasse. He is seeking an independent assessment of the costs, since part of the dispute centres around the level of inflation over the next period of the contract, which could add a further £400m to the final bill. But Mr Parry signalled that his priority was getting clarity from the firm over the delays on the Jubilee line contract. ‘I am not at all surprised by this. We need Tube Lines to admit what it is actually capable of doing – and just come clean,' he said.

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BUSINESS

Arbitration lined up to resolve Tube row

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