FURTHER to Richard Greenwood's letter "Metrolink Fares Shock" (May 18), I would like to clarify for your readers a number of issues that concern the operation of Metrolink.

Greater Manchester Passenger Transport Authority recently took the decision to enter into negotiations with Altram, the company awarded the present Metrolink contract, over early termination of this contract.

This move was taken to achieve a smooth hand-over of the system to the company to be appointed within the next 12-18 months to develop and operate the third phase of Metrolink extensions and to run the existing three lines. It is not true that Metrolink is making an operating loss. It is, however, true that Altram could increase fares by the 30 per cent mentioned because this is within the terms of the present contract. Given Altram's position as the "retiring" operator, it would be entirely within the private sector rights to take a purely short-term commercial action.

By re-negotiating with Altram, the Authority is striving to avoid such an outcome and, if successful, will achieve its aim of stabilising fares, maintaining passenger numbers and safeguarding Metrolink's long-term future, including that of the Oldham-Rochdale line.

To suggest that Altram's present situation has arisen because politicians pushed to get the Eccles extension built rather than "other, more financially sound, extensions", is untrue. Eccles was the only extension GMPTE was able to deliver at the time and had a financially robust case, it having significant guarantees of private sector investment.

This was, of course, testified when central government, having gone through the financial forecast with a fine tooth comb, decided to give grant funding to the scheme. Patronage along the line, which has been open less than 12 months, is continuing to grow and will be boosted with the opening of a Park and Ride site at the Ladywell Metrolink stop in the coming weeks and, further, when the Phase Three Metrolink extensions are up and running.

Whatever decision Altram takes will be short-term and commercial, based on achieving the best possible returns for their shareholders. What the Authority is attempting to do by acquiring the concession, is to make sure passengers are protected from the possible outcome of this decision-making and ensure that we are in the best possible position for the future development of the Metrolink network in Greater Manchester.

GEOFF INSKIP,

deputy director general,

Metrolink project director.