Metromess "Efficiency" Drive

[suncloud]

Is this a bit of a worry?

news.bbc.co.uk/1/hi/england/london/6683689.stm

[Chris W]

I read that too

Lets have a quick political history lesson of railways (both national & LU over the past 28 years):

• 1979-90: Thatcher government under-invests (criminally IMO) in railways, saving money for voters so that they'll continue voting Tory as opposed to the 'wasteful' socialists
  
• 1990-97: Major government thinks "oh foxtrot, the railways are falling apart - what can we do?" promptly privitising the entire system. Some typically ex Tory politicians soon become so-called directors of such companies earning significant sums from their positions
  
• 1997-date: Blair Presidency decides that Public/Private investment is the right answer resulting in numerous hospitals being built & then being leased to the NHS & 30 year maintenance contracts being agreed between private maintenance firms & LU/TfL on the underground
  

Don't get me wrong I do NOT think that any system is perfect, however if decent investment had been continued in the railways throughout the 80's, there would never be a need for us to be in the position of mega investment today - in this case perhaps stretching one company to the edge of its financial limitations. Having said this I have NO doubt that such maintenance companies will be earning themselves very healthy incomes/bonuses in the later years of their respective contracts - should they survive that long.

[Phil]

There are seemingly only two possible scenarios here:

1. the loss of jobs doesn't affect work done (no mention of trackside jobs going) - so why have they waited all these years to do it? (Rider - is it because they are now outsourcing/going to competitive tender?)

2. the loss of jobs restricts the amount of work that can be done - fall further behind, more penalty payments.......then what?

Either way the colloquial name at the top seems that little bit less unfair again.

[Tubeboy]

What is/has happened is that they are [planning!!] to lay off some middle management and agency staff. At the same time, they have recently increased their track and signal worker numbers by 25% each.

The RMT have said if redundancies occur, they will ballot for industrial action.

[DWS]

tubeboy said:

What is/has happened is that they are [planning!!] to lay off some middle management and agency staff. At the same time, they have recently increased their track and signal worker numbers by 25% each.

The RMT have said if redundancies occur, they will ballot for industrial action.

How many middle managers and agency staff will be members of RMT, my quess is none, Bob Crow just shooting from the hip again ;D

[Tom]

Depends where the middle managers are located.

Asset Performance types could well be if they've worked their way through the grades.

ISTR the Bob Crow statement was subtly different to Tubeboy's post , that if any RMT Members are made redundant, they would be in dispute?

[stanmorek]

Quite a few of the senior and middle managers in areas like track maintenance started from the pway cabins and are still likely to be trade union members.

[Deleted]

Although I side with TfL on a lot of Metronet's incompentance, it was interesting to read the other side's take on things in the Daily Telegraph on Thursday. Their claim is that TfL considers all the contracts to be "fixed price, flexible scope", and that TfL change their mind as to what the contract includes on an almost daily basis.

One example cited, is that TfL insisted on platform handrails for people with immobility needs at stations where the only access to the platform was down stairs, for example at Lancaster Gate station. My opinion is that there could be good reasons for this, one of which is that older people can walk down the stairs but need some reassurance. The other is that TfL are perhaps future-proofing, as lifts may be installed at the stations later.

Of course, it is impossible for us mortals to know where the truth lies, but as the cliché goes, it is probably somewhere in between.

I merely wonder why Metronet lawyers didn't read the terms of their contract a little more carefully before they readily undertook commitments towards such flexible requirements.

[trainopd78]

I'm guessing that the whole thing is so complicated that it ended up being full of holes where nobody is 100% sure who is responsible for what in some areas, with other important things being missed out of the contracts altogether. The only real winner IMHO is PWC who fudged these very holed contracts together to start with.

[Tom]

alantan said:

Although I side with TfL on a lot of Metronet's incompentance, it was interesting to read the other side's take on things in the Daily Telegraph on Thursday. Their claim is that TfL considers all the contracts to be "fixed price, flexible scope", and that TfL change their mind as to what the contract includes on an almost daily basis.

My experience of doing LU 'Additional Works' isn't quite like that.

They (LU) have got a habit of requesting variations, but these do normally take the form of 'assess the cost and programme implications' before they actually request the work to be carried out.

What can often happen however is they look at a job, work out how much they're willing to pay for it (which is invariably a lot less than it will cost as they don't fully assess what's involved, for a variety of reasons) and then complain when the price finally comes in.

I dread to think what it's like for Tubelines, who charge a fair bit more!

I suspect on the Upgrades side things are a little different. As it's work that Metronet are supposed to be doing under the PPP, LU may well put every obstacle in their path. When it comes to additional works, because it's work LU wants doing they can be more helpful.

[prjb]

It's all pretty straight forward on upgrades if you cut through the c**p!

The Infraco's signed a contract with TfL and they are obliged to deliver what that contract stipulates. Sometimes there are disagreements on what the contract states, mainly because the people who wrote them are no longer around. So, as an example, the contract might say provide count down clocks at stations and LU take that to mean every station where as the Infraco interprets this to mean at certain key stations. Generally there is a 'bun fight' and we end up coming to an agreement.

Then there are 77 Use Cases which detail additional works and these allow the Infraco's to do this work and then get paid a set figure based on a scoring system. So, MRSSL decide to provide a crew management system/decision support system (as an example). They put this proposal to LU and then based on the usefulness and the features being offered we score them (1 being low and 10 being high). It's then up to them to decide if the score we offer them has enough financial incentive to proceed.

There are then 'Specified Rights' in the contract, such as OPO CCTV or 7 Car Circle. These are things that LU can instruct the Infraco's to provide and then they charge us for delivering them.

Finally LU can include 'Candidate Requirements', these are things that we think we want or need as part of the upgrade but are not included in the contract/Use Cases/ Specified rights. The Infraco's class them as in or out of scope and we then have a bun fight to decide what we get for free and what we get for a price. Once we have a price we present a business case to the board and the board decide if it is worth it or not.

Generally in my experience, these things go quite well. As an example Metronet have just gone out to tender for a major piece of kit for the SSR Upgrade. They consider a lot of the features specified to be out of scope but have included them in their tender before we have even come to an agreement on them. They have said that in the interests of getting the project moving and keeping to schedule, even though they don't believe they are contractually obliged to provide most of the features, they will just include them for now and we can all sort it out later. This shows how well we are working and how committed this particular part of the project team are to getting the job done. Most of the Metronet people I deal with are ex-LU and dedicated professional railwaymen anyway.

[stanmorek]

My take on it is that the PPP contract is a general overarching contract covering all the different disciplines of which fleet, signalling, track, civils etc have been horsed into. It was not an easy task to come up with a single contract to reconcile all these individual workstreams in a highly interdependent system like a railway. Needless to say, the contract is better suited to some areas than others. Excluding the subcontracts, the main service contract amounts to several telephone directory like volumes.

My view is that PPP is essentially a performance based contract which suits the likes of fleet and signalling whereas civils infrastructure would be better measured on the condition of assets. As result there is a crackpot system in civils of scoping work and agreeing the cost and payment for work between LU and the infracos. The trouble is that LU only started a systematic process of categorising and assessing the true condition all its assets on the network about 10 years ago. PPP has convieniently got around this problem by not having any work done to large parts of the network expect that any assets subsequently found to a be safety risk is made safe on a temporary basis until an agreement is made on who pays for the permanent work. One of the main planks of civils works the infracos have to complete in the first 7 years of the PPP is to finish the assessments of all assets LU started.

So when PPP was in the bidding phase an incomplete picture of the condition of the network was provided to bidders to base their price on. In some ways it's apt that TfL considers the contract "fixed price, flexible scope" except that in contract law it doesn't quite work like that. It would be difficult to price work when you can't be sure of the amount of work required as the case is in station refurb work. Likewise before the track replacement works can take place, civils work ahead assessing the effect of the BTRs on structures. In the outside world contractors would be charging top dollar to carry the risks where insuffient information has been provided by the client for a job. The issue of being uneconomical and inefficient aside (which is a different kettle of fish) the infracos could well have underpriced work.

The lack of information of existing assets is endemic and to my understanding, the costs infracos are liable for are capped in case of damaging buried LU services in course of their work. In short loads of below ground cables have been laid over the years that there is not a comprehensive record of where and how many cables there are in locations such as depots. and no contractor is able to get insurance to cover the risks.

Historically under LU, each discipline has operated in isolation from the others, which we called a siloed approach, and this has not translated well into the private sector. Back then where there were overlaps between areas of responsibility in track, civils and signals some kind of local agreement could be sorted out. In this day and age it has to be argued out on who pays for what to cover the gaps in each others contractual obligations. Like when leaking drainage though not a direct short term threat to civil structures causes havoc with track and signalling. During bidding for PPP, LU baulked at the cost of track drainage replacement and removed it from the first contract review period.

Getting back on topic, the decision by Metronet to go outsourcing/competitive tender on some of its work wouldn't have much bearing on redundancies as the affiliate subcontractors were staffed by employees of shareholder companies.

[Phil]

The situation is strangely reminiscent of Railtrack. There the contract was seen to be a way of making shedloads of dosh for the shareholders, and when it turned out some serious money needed to be spent the Railtrack directors screamed 'foul' and went back for more......and more........and more again except that this time the answer was 'no' and the company folded.

And though there are differences*, so it is also with Metronet. As stated above it is almost suicidal to take on a contract without knowing the state of the assets UNLESS you think there are shedloads to be made anyway.
So it does seem that TfL are playing games and increasing the scope of almost every job whilst insisting on the fixed price - but if that was the way the contract was written (and I bet it was....) Metronet only have themselves to blame.

As put in a previous signature 'History is a study of the inability of man to learn from his own mistakes'.

* the biggest seeming to be that Metronet are apparently unable to be sacked whatever they don't do.

[stanmorek]

That's how Metronet will put forward their case in recovering their cost overruns with the PPP Arbiter's assessment. If they don't like the verdict then it will go to the courts and expect that either way TfL are found to be playing games or have aspects of PPP ruled unfair.

In the cut throat world of construction it is not uncommon for a contractor to undercut its rivals to win the job knowing it will make a loss. They'll have their lawyers and QSs pick through the contract documents and claw back money through claims and the courts...

The PPP is over half way through it's first quarter, the first contract review period. Assuming no other external factors, unilateral termination of the contract is unlikely to happen though the terms will certainly be renegotiated with downsizing of scope quite possible.

Fair point you make Phil about Railtrack but I think it took Hatfield and it's aftermath to really break them. Also, Metronet should take heed of what happened with Railtrack in it's efficiency drive and not losing it's in-house technical capability inherited from the infracos. Railtrack contracted out everything becoming a middleman ran by accountants and ended up being totally reliant on outsiders charging the earth.