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By Andy McCue, 10 October 2003 16:34

NEWS A £3.5m payment to Capita for improvements to computer systems running London's £280m congestion charging scheme has come under fire from London Assembly members. Concerns have also been also raised about Transport for London (TfL) signing away intellectual property rights to Capita in a budget report released by TfL to the London Assembly. The report, Public Interest, Private Profit, also reveals that Capita was fined £1m for "liquidated damages and service credits" prior to the contract being renegotiated, with Capita being given an extra £31m over the remaining four and a half years of the deal to make improvements to computer systems, customer service and the enforcement of fines. That £31m included a one-off payment of £3.5m to Capita for IT systems which the services firm estimated would total £5m. The report said it did not view the extra payment as "a good deal for Londoners" as this was "a cost which should have been met by Capita and not TfL". TfL signed a non-exclusive licence for the Capita software that effectively signs away its intellectual property rights to the congestion charging system, according the budget report. The Assembly expressed concerns as to whether TfL has "secured sufficient rights of veto over and of exclusivity in intellectual property should the scheme be introduced in another city in a similar form". The contract renegotiation also increases Capita's share of fines recovered from those motorists who fail to pay the controversial £5-a-day charge to drive into London. Currently only 59 per cent of the 441,000 penalty notices have been enforced and the increase of Capita's share from £2.06 to £4.90 per fine is supposed to be an incentive to encourage the firm to recover more fines. But the Assembly report pointed out that this reduces TfL's share of the penalty revenue by £2.84 per notice. In addition to the success of the scheme in deterring drivers from coming into London, this will contribute to a reduction in congestion charge income for TfL of £64m over the course of the contract. Sally Hamwee AM, chair of the London Assembly’s Budget Committee, said: “There is no doubt that the Mayor’s Congestion Charging Scheme has been a success in reducing congestion in central London. But in fulfilling our duty to scrutinise the Mayor’s spending we have discovered that Transport for London’s administration of its contract with Capita has fallen down." TfL was not immediately available for comment.