The highly critical report from the National Audit Office on the collapse of Metronet Public Private Partnership (PPP).
This document was published on 5th June 2009 by National Audit Office.
It was written by National Audit Office.
The original document format was PDF File, and comprised 62 pages.The original document can be found here.
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"The main cause of Metronetís failure was its poor corporate governance and leadership. Many decisions had to be agreed unanimously by five shareholders, which all acted as Metronetís suppliers and had different
motivations depending on their roles. The executive management changed frequently and was unable to manage the work of its shareholder-dominated supply chain effectively. These suppliers had power over some of the scope of work, expected to be paid for extra work undertaken and had better access to cost information than the management. The poor quality of information available to management, particularly on the unit costs of the station and track programmes, meant that Metronet was unable to monitor costs and could not obtain adequate evidence to support claims to have performed work economically and efficiently...
DfTís role in securing value for money was: (i) to protect the taxpayer from potential financial liabilities; and (ii) to ensure that those responsible for the delivery of the improvements, which it was funding, were operating effectively. Metronetís poor corporate governance and tied supply chain created financial and delivery problem DfT had few formal levers to influence outcomes as it was constrained by devolved oversight arrangements and was not itself a party to the contracts. Instead, it relied on other parties whose ability to identify risks was hampered by the poor quality of information available from Metronet. The fact that these other parties did not mitigate the risks effectively exposed DfT to major residual risks which it had few levers to manage. As a result, the taxpayer was not effectively protected."
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