01 December 2000
Stephen Glaister, professor of transport and infrastructure at Imperial College, said the loan from the European Union's in-house bank reflects private sector companies' lack of confidence in raising their own finance for the controversial scheme.
'It compromises the policy of shifting the financial risks on to the private sector. The government is standing behind this, which is something it said it would never do,' he said.
News of the loan emerged on November 29. Consortiums that secure the contracts to run different parts of the Tube's track and signalling would each receive £300m from the EIB.
A spokesman for the bank confirmed the loan had been approved and said it reflected the bank's history of supporting Private Finance Initiative schemes.
These include a £105m loan for a schools project in Glasgow, announced in August, as well as assisting the Treasury in setting up Partnerships UK.
London Mayor Ken Livingstone confirmed this week that he is still considering legal action to force the government to hand over more documents on the PPP.
The man he has put in charge of the scheme, Bob Kiley, was this week in New York studying details of the government's proposals from papers released to him by officials. Livingstone's office said vital papers were still being withheld.
Controversy over the issue is expected to grow in the next few weeks with the publication of National Audit Office and Health and Safety Executive reports into the merits of a PPP for the Tube.
PFdec2000
