Report urges councillors to vote to build capital tram

The tram project is behind schedule and over budget

Council officials are recommending councillors should vote to complete the tram line to St Andrew Square instead of scrapping the project.

It emerged that it would cost about £750m to cancel the project, more than £200m over the original budget of £545m.

The report said it would cost up to £770m to build the line from Edinburgh Airport to St Andrew Square.

It found it would cost £700m to build it to Haymarket from the airport.

First Minister Alex Salmond has given his backing to calls for a public inquiry into the handling of the Edinburgh trams project.

Mr Salmond said some parties would have more to fear from an inquiry than others.

SNP MSPs have always opposed the controversial project.

An Edinburgh City Council report on the tram was revealed online at 1600 BST, but the cost to scrap the tram project, which was leaked a day early, were omitted for legal reasons.

Councillors will decide the fate of the project at a meeting next week.

The original budget of £545m had been the figure for running the line through the city centre and on to Newhaven in the north of the city.

A contractual dispute between the tram company Tie and contractors Bilfinger Berger pushed the project over budget and behind schedule.

Mediation talks are understood to still be under way after the initial meetings between Tie and Bilfinger Berger were held in Glasgow in March.

In May, a report published by Edinburgh City Council said work so far had cost £440m - about 80% of the original budget - with huge sections of the line still to be completed.

Edinburgh councillors ordered a report to be written by officials into the estimated costs of scrapping the tram project.

A full council meeting will be held on Thursday 30 June to decide the future of the scheme.

Officials have indicated that the line to St Andrew Square could be finished by 2013, and operational by 2014.

Completing the line to this point is said to save 500 jobs associated with construction, and 147 tram operations jobs.

In their report, officials admitted that it will take several years to build public confidence to a level where the trams system could be extended beyond St Andrew Square.

Jenny Dawe, Edinburgh City Council leader, said: "This report is crucial for the tram project. The options presented give elected members a lot to think about over the next week in deciding the future of integrated transport for the city.

"Nobody would have wished for the problems that have beset the scheme.

"However, we must find a way forward that sees trams running on our streets in the next couple of years."

A council spokeswoman said the costs of phase one of the project were still subject to commercial negotiations and legal scrutiny.

"In accordance with the outcomes of the mediation process in March, we cannot publicly divulge these figures until both parties have agreed to do so," she said.

The tram control room in Gogar has nearly been completed

"Members are, therefore, being given this confidential information to help them make informed decisions at next week's council meeting and we will ask them not to disclose this to ensure we comply with the mediation process."

When the news was leaked on Wednesday, Andrew Burns, Edinburgh City Council's Labour leader, called for a public inquiry into the tram project.

The issue was raised at first minister's questions on Thursday by Labour MSP Kezia Dugdale.

Mr Salmond replied: "I think we should let Edinburgh Council continue its deliberations, but certainly I think a public inquiry would be an excellent thing to do."

Ms Dugdale said later: "A full, independent public inquiry is the only way we can get to the bottom of exactly how the project has been allowed to go so badly wrong and I am pleased the first minister has backed my call.

"This is now about making the best of a bad situation and I look forward to working constructively with the Scottish government to get the inquiry up and running as soon as possible."