Edinburgh trams: Ministers to help finish project

The Scottish government had said it would withhold about £72m from the project

Scottish ministers have stepped in to help run Edinburgh's troubled tram project, to ensure its completion.

A team of officials from government agency Transport Scotland has been sent in to take up senior positions at the city council.

At the same time, ministers have agreed to reinstate £72m of government funding they earlier decided to withhold.

The move came just hours before a deadline on resolving a dispute with tram contractor Bilfinger Berger.

Infrastructure Secretary Alex Neil said the government was taking forward the project in "partnership" with Edinburgh City Council, which is still responsible for delivering the trams.

But he stressed the government had powers of veto and "the power to direct", while insisting: "The buck still stops with the city council".

Opposition parties said the government's intervention had come years too late.

Major construction on the trams - due for completion in summer 2014 at a cost of £776m - had been halted more than two years ago, following a dispute over who should pay for additional costs.

Senior Transport Scotland director Ainslie McLaughlin will sit on the new project board set up to see the trams project through, while as many as four other staff at the agency will work with council officials in key, senior roles.

Mr Neil said: "The Scottish government has a strong track record, through Transport Scotland, of delivering major projects like the M74 early and under budget and secured significant savings on the three contracts to deliver the new Forth Replacement Crossing.

Project 'abandoned'

"As part of the arrangements put in place today, ministers will receive regular updates on the progress of the project, and will also retain a veto over strategic decisions in respect of remaining government funding."

Edinburgh City Council had earlier made a decision to run the tram line from the airport to Haymarket, rather than to St Andrew Square in the city centre.

That prompted ministers to withhold the remaining chunk of the £500m of government funding for the project.

But ministers have now agreed to provide the final £72m, after the council overturned its decision.

The original budget for taking the line from Edinburgh airport through the city centre to Newhaven, in the north of Edinburgh, was £545m.

Mr Neil said TIE, the arms-length company originally set up by Edinburgh City Council to deliver the trams, "effectively is no longer".

Major work on the trams had been halted, as a result of the dispute

Edinburgh City Council had previously been given until Wednesday to settle the contract dispute with Bilfinger Berger.

Council leader Jenny Dawe, said: "We have been in constant dialogue with Transport Scotland throughout and both parties agreed that it would be beneficial to have a closer relationship in the operational management of the tram project.

"We have a joint interest in ensuring a clean, green and efficient transport network is delivered in Edinburgh and our new working arrangements are a logical extension of the discussions we have had with them."

Scottish Labour leader Iain Gray said the SNP government abandoned the trams project four years ago, adding: "This is a flagship project in Scotland's capital and it is a disgrace that the SNP government has had to be dragged kicking and screaming into sorting out a shambles of their own making.

"They have let Edinburgh down badly."

Tory transport spokesman Jackson Carlaw, said: "Nobody is fooled by the SNP pretence that the trams fiasco has nothing to do with them.

"The SNP government signed the cheques. They removed Transport Scotland and its expertise from the project in the first place and SNP councillors signed the contracts."