1 The bidders were not asked to provide 30 year funding and LUL wanted flexibility to vary contract terms at set times, and to alter performance outputs to deal with discrepancies or improve incentives.11 The parties agreed therefore to submit the contracts to periodic review every 7½ years. The Arbiter was created in the 1999 Greater London Authority Act to help facilitate this review, but also to manage extraordinary reviews and provide guidance as and when required - see Figure 13 for more detail.
2 Chris Bolt took up the post of Arbiter in December 2002. He is on a 4-year contract and has a budget of £1.6 million in 2004-05. Two of his staff were closely involved in the negotiation of the PPPs on the public sector side.
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11 It was LUL's assessment, after taking advice, that poor value for money came from asking for a 30 year fixed price. The bidders were therefore asked to provide firm prices for the first 7½ years.