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The former chair of collapsed tube consortium Metronet was forced to defend accusations of corruption yesterday during a heated Select Committee hearing into its failure.

Graham Pimlott, Metronet chair from January to July this year, faced a grilling from MPs while transport secretary Ruth Kelly was pushed to begin a public inquiry into the collapse, now costing 拢13m a week in administration costs.

Ernst and Young said it hoped Metronet would emerge from administration by mid-January, by which time the company should be transferred to the sole bidder for its contracts, Transport for London.

Metronet went into administration after racking up 拢2bn in losses on its public-private partnership contract to upgrade two-thirds of the London Underground network.

Metronet failed because, at risk of being simplistic, it ran out of cash.

Metronet, chair Graham Pimlott

Yesterday, blame for the collapse was spread between shareholders, financiers, executives and the consortium鈥檚 structure.

Five of its former managers, including chief executive Andrew Lezala, left in October. Pimlott, left to explain the debacle, told MPs: 鈥淢etronet failed because, at risk of being simplistic, it ran out of cash鈥�.

The contractual relationships were fatally flawed and, he said, 鈥渋t seems to me in this case what has happened was that one or two things have gone wrong and ultimately badly wrong over a period of time鈥�.

The evidence was attacked by Labour MP Graham Stringer who said Metronet 鈥渋n straightforward English language, is corruption. It is looking even more corrupt when companies that are doing work don鈥檛 have a contract for the work they are doing鈥�.

It is looking even more corrupt when companies that are doing work don鈥檛 have a contract for the work they are doing.

Labour MP Graham Stringer

London Underground managing director Tim O鈥橳oole said Metronet failed because of a 鈥渦nique flaw in its structure鈥�.

There was no-one with 鈥渁n iron fist鈥� who could force the contractors to do the work 鈥渙r fire them if they didn鈥檛鈥�.

Difficulties with the contract resulting in 鈥渁 self-perpetuating army standing around and nothing getting done鈥�, he said.

鈥淸Even] if Jack Welch [former chair and chief executive of General Electric] had been running the company it would have failed. The structure guaranteed failure in my opinion鈥�.

Thyere was no evidence of corruption but collapse was great failure

Ruth Kelly

Stringer pushed Kelly for a public inquiry, saying what she considered poor governance practice 鈥渟eems to me corrupt. There is nobody publicly accountable. Don鈥檛 you think, given that, there should be a public inquiry?鈥�

Kelly said she had no evidence of corruption but accepted the collapse was a 鈥済reat failure鈥�.

She defended PPP arrangements, saying they can 鈥渄eliver very good outcomes and value for the taxpayer,鈥� but adding, 鈥渋t鈥檚 clearly the case they won鈥檛 automatically deliver value for money鈥�.

None of the committee鈥檚 witnesses were able to put a figure on the final cost to London taxpayers, despite pressure from the MPs. Kelly said that figure would become apparent 鈥渋n due course鈥�.

She said the shareholders鈥� reputations had suffered and warned their history could count against them when bidding for future contracts. Three of its five shareholders 鈥� Balfour Beatty, Atkins and Bombardier - have written a combined total of 拢300m off their books.