MIDLAND METRO, the tram system that links Birmingham and Wolverhampton, was on the brink of financial collapse last night after auditors refused to sign off the accounts of the company formed to build and run the system under the Private Finance Initiative (PFI).
Midland Metro was built by a consortium called Altram LRT, which includes John Laing and National Express. The revelation of its financial problems comes days after it emerged that Croydon Tramlink, another PFI tram network, is desperately trying to refinance itself ahead of a deadline next month.
The financial setbacks for the tram networks raise questions about the future of the PFI for light rail systems and heighten analysts’ concerns about the lack of disclosure of PFI projects in parent companies’ accounts.