Mr Livingstone has warned that the project in its current form is unworkable and must be taken apart under state ownership, in a process that would unravel one of Gordon Brown's signature policies.

The London mayor's transport body has staked its claim to acquire the contracts and restructure them in-house by portraying the tube PPP as effectively worthless and unfit to be taken on by another private company.

Metronet, the PPP contractor responsible for upgrading three-quarters of the tube network, entered into administration in July after building up a projected overspend of £2bn.

Tim O'Toole, managing director of London Underground, said he would be "shocked" if a private company lodged a bid for the two PPP contracts operated by Metronet. Speaking at a recent London Assembly transport committee, Mr O'Toole said he expected that TfL will be "the only bidder" for Metronet's assets. Asked if Metronet would be bought by a private company, he said: "I will be shocked if it is. I don't think there will be any buyers."

The Tube PPP, one of Gordon Brown's cornerstone policies during his time as Chancellor, was bitterly opposed by London’s mayor. Mr O'Toole indicated that Mr Livingstone would have the final say in a row that went to the High Court six years ago, as he outlined plans to dissolve the PPP project while it is under TfL ownership.

The LU boss said that the contracts would be split into their constituent parts - including track replacement work, building new trains and rebuilding stations - before the work is resold to private companies, with tasks such as track replacement kept in-house. Asked if the contracts would return as part of a restructured PPP project, Mr O'Toole said: "Whether it is a PPP; that is what we will have to determine." Shortly after Metronet went into administration TfL held talks with the government about taking over the contracts on a temporary basis, but it has now decided to make an official approach to administrator Alan Bloom, the Ernst & Young accountant who was called in to manage Railtrack's insolvency.

Mr Livingstone has played an astute political game second time round, refusing to criticise the PPP process or its intellectual godfather. However, his office has made clear in talks with government officials that they believe Metronet's internal problems to be more severe than envisaged and they are unlikely to be resolved if the contracts are returned to the private sector.

Tim O'Toole, the head of London Underground, said last month he expected the government to refund any money spent by TfL on propping up Metronet while it is in administration.

Under the terms of the PPP, Metronet was paid around £860m a year in taxpayers' money. Other funds came from Metronet's shareholders.