3.10 Concurrent with the planning of the PPP, the Government had also been preparing to devolve certain powers to a new form of local government for London, the Greater London Authority, consisting of the Mayor of London (the Mayor) and the London Assembly. Transport for London came into being under the Mayor's direction, and had responsibility for meeting the Mayor's transport strategy. Originally the relevant legislation was drafted on the expectation that the PPP arrangements would be in place when the Mayor took office in 2000.
3.11 When it became apparent that the PPP procurement timetable was too optimistic, the Department decided that London Underground would complete the PPP before transferring the Tube to Transport for London. The GLA Act granted Transport for London consultation rights, recognising that the future owners of LUL should have some involvement in the process, mainly to facilitate the eventual transfer of ownership.
3.12 The Mayor and Transport for London had repeatedly and with determination objected to the PPP. During the course of the procurement London Underground engaged in twenty rounds of consultation and many meetings - mainly in the early stages. Increased resources had to be deployed to respond in detail to issues raised as the deals evolved but London Underground could not disaggregate all the associated costs from other transaction costs. London Underground, however, did keep separate records for the direct legal costs of meeting the two legal challenges brought by the Mayor, amounting to £1.5 million in the second case (and less in the first). The Department waived its rights to collect the costs awarded against the Mayor at the conclusion of both actions. Transport for London consider the scale of its legal costs to be very modest in comparison with the size of the deal and the professional costs incurred on other aspects of the PPP. The Department notes that London Underground's costs do not include substantial internal costs and extra work for non-legal advisers, nor reflect the impact on procurement negotiations, the timing and the market's perception of political risk.
3.13 The Department attempted to combine resources and negotiate jointly with the private sector from 4 May 2001 to 17 July 2001 by putting Transport for London's Commissioner for Transport in charge of the PPP negotiations, but his goal of unified public sector management control proved incompatible with the Department's aim of transferring comprehensive risk and responsibility to the private sector. Some benefits were, nevertheless, obtained during the prolonged consultation exercise - and the Department believes could have been obtained without prolonged opposition to the PPPs. Transport for London's scrutiny of the proposed PPP deals resulted in it raising numerous points where it was concerned, as the future owner of the Tube, that the client's position was or seemed weaker than it should be. In some cases the proposed contracts were redrafted to reduce, or remove, the expressed concerns.