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PPPs and the London Underground: 150 years of development

Posted by on Jan 10, 2013 in All news, Funding, PPP, Rail, Sustainability, Systems, Urban planning |

One hundred and fifty years ago today the world’s first underground railway opened to its first paying passengers when the London Metropolitan carried 30,000 people between Paddington and Kings Cross.

“The 120 trains in both directions that day suffered no serious breakdowns and the only major delays were caused by the crush of people trying to get on the trains,” writes Christian Wolmar, in a new edition of his highly enjoyable history, The Subterranean Railway.

There are still ‘no serious breakdowns’ on most days, and the system remains uncomfortably congested at peak times, but much else has changed.

That first line was built and operated through what would now be called a public-private partnership (PPP), but how different its effects from those of the latest PPP that ended in fiasco at a cost of more than $2 million more than the same investments would have required through conventional public borrowing.

The London Underground was the brainchild of the visionary Charles Pearson, who was the City of London Corporation’s in-house solicitor from 1839 to 1962. Today it comprises more than 400 kilometres of track represented schematically in the iconic map designed by Harry Beck in the 1930s.

Beck was then employed by the Underground as a draughtsman, and both his and Pearson’s contributions underline a truth that is often lost these days — that the public sector at its best is full of imagination, innovation and creativity.

The ethos that guided Pearson’s work might seem like a throwback to 19th century attitudes of patrician public service, but — like the Underground itself, and its map design — it has never been more relevant.

Pearson’s employer was the public side of that original PPP, and when the private side, the Metropolitan company, offered him a reward, Wolmar records that he replied:

“I am the servant of the Corporation; they are my masters and are entitled to all my time and service. If you have any return to make, you must make it to them.”

How Pearson must have turned in his grave as the most recent PPP unravelled.  Wolmar notes that it did mobilise a great deal of much needed investment to upgrade the Tube lines, before being scrapped only a quarter of the way through 30-year contracts, but he adds:

“The concept had been pushed through on the basis of extremely dubious evidence that suggested that the PPP would be cheaper than an entirely public-sector option, but in the event proved precisely the opposite.

“It is no exaggeration to say that billions of pounds were wasted in pursuing this ideological concept when the money could have been invested in simpler and more cost-effective ways of improving the Underground.”

  • The Subterranean Railway: How the London Underground was built and how it changed the city forever, Christian Wolmar, Atlantic Books (London), 2012 (Revised and Updated Edition).

For more about PPPs, go here.

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