The government's bid to privatise the Tube is facing further problems after one of the key firms involved described the deal as "an albatross round its neck".

Amey, the construction firm that is putting £60 million into the project, is withdrawing its interim dividend to shareholders and admitted it may have to find a buyer.

There are also claims that taxpayers will end up with a bill running to billions of pounds as part of contingency plans to underwrite the project against further legal challenges by Ken Livingstone.