Edinburgh in legal action over nine-year-old tram

Edinburgh City Council is still dealing with an ongoing legal claim almost a decade after the opening of its troubled tram system, it has emerged.

The Scottish local authority included £4.5m for “resolving outstanding disputes” in a table of estimated costs to the public purse from the project.

A public inquiry in September published a critical report into the three-year-late, £300m over-budget construction of the first phase of the tram network.

Now a report to councillors has detailed the local authority’s response and set out more detail of how costs escalated on the scheme.

Construction of the tram system was priced at £852.6m in the council’s latest document, up from an initial budget of £545m.

The updated cost includes £4.5m for outstanding disputes, with the report saying this related to two separate claims, one of which had been detailed to councillors in private and paid out on.

“The second is still to be settled, but will be reported to members prior to any payment being made,” said the document.

Other additional costs included staffing and pension payments as well as funds awarded to businesses on the line.

The report added that including the £207.3m budget for the second phase of the project, linking York Place to Newhaven, took the final cost above £1bn.

In September, public inquiry chair Lord Hardie cited “poor management and abdication of responsibility on a large scale” as he picked through the debris of the error-strewn project.

Arm’s-length operating company TIE, which was responsible for negotiating design and construction contracts on the tram build, came in for particular scrutiny. It had “no knowledge of, or experience in, managing the particular difficulties associated with the construction of a tram or light rail system through the centre of a city in the UK”, said Hardie.

The inquiry found that when TIE entered into a contract with Bilfinger Berger and Siemens, trading as Infraco, to undertake construction and engineering works on the tram project, utilities had yet to be cleared and design work was incomplete.

Evidence collected by the inquiry included a 2010 note from a senior solicitor at the council to its head of legal services, headed “Tram briefing”, which warned that “dissemination of the actual history here could cause serious problems” and said keeping “politicians” on “restricted info flow” was “critical”.

The council said in its response to Hardie’s report that a probe had been conducted to consider the actions of those employees still working for the local authority. “Following completion of the investigation process, recommendations were considered by the chief executive, who was satisfied that the process had been robustly conducted and concluded that there was no further action required,” it added.

The report and its recommendations will be considered by Edinburgh Council’s Governance Risk and Best Value Committee, Transport and Environment Committee and full council. The council is expected to accept the bulk of suggestions made by Hardie.

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