Audit Scotland to review Edinburgh trams project

Edinburgh's tram project had been expected to cost the city £545m

The public spending watchdog is to review Edinburgh's controversial trams project.

Audit Scotland will compile a report on the scheme following a request from the Accounts Commission and Robert Black, the Auditor General for Scotland.

The multi-million pound project has been hit by delays and a dispute with contractors Bilfinger Berger.

The watchdog said it would produce an interim report in 2011, drawing on other audit work already carried out.

A spokeswoman for Audit Scotland said: "The auditors of Transport Scotland and the City of Edinburgh Council have been closely monitoring the project and its associated risks as part of their ongoing audits.

"This report will draw on their findings."

The spokesman said the interim report would consider the progress of the tram project to date, governance arrangements and the key issues affecting it in future.

A spokeswoman for Edinburgh City Council said the authority's understanding was that Audit Scotland would not be seeking to audit the tram project, but would focus on the project's progress, costs and key issues to date.

'Hide problems'

Lothians MSP Shirley-Anne Somerville gave a "cautious welcome" to the development but raised concerns about the timescale of the report's publication.

She said: "With the council set to make key decisions on the project in December, it is essential the people of Edinburgh have answers before then.

"The devil is in the detail and any effort to hide problems with the management of the project under commercial confidentiality will be unacceptable - as would any attempt by anyone involved to draw this inquiry out or to delay this report."

The MSP also called for Holyrood's Transport Committee to hear from tram chiefs at the earliest opportunity.

In June this year it emerged that the trams scheme was facing cost overruns of more than £50m.

Contingency plans were drawn up to borrow the additional funds for the project, which had been expected to cost £545m.

David Mackay, who was appointed to the role of project chairman two years ago, stepped down from his post last week.

On Tuesday, it emerged that the main contractor of the tram scheme, Bilfinger Berger, dropped a legal action for defamation against Mr Mackay after he described them as "delinquent" in a newspaper article.