CITY leaders today accused the Scottish Executive of "killing stone dead" any hope of a tram line linking the city centre with south-east Edinburgh.
Transport chiefs have been told there is no prospect of the Executive providing any more money towards the 198 million scheme in the foreseeable future.
The proposed tram line, which would serve the ERI at Little France, the growing research park beside it and Edinburgh University, is a crucial part of the city’s transport plans.
The council had hoped to fund it with money raised from road tolls, but defeat in last month’s referendum left it relying on the Executive for funding.
But the Executive has now made it clear to the council’s arms-length transport company, TIE, that there is no more cash in the pipeline.
Today, council leader Donald Anderson said the decision was "a crushing blow" for the Capital, which would leave it lagging behind other major European cities. He is demanding a meeting with Transport Minister Nicol Stephen in an effort to persuade him to reverse the decision.
The south-east Edinburgh tram line would run from Waverley Station to Newcraighall, serving Newington, Cameron Toll, the ERI, plus the planned biomedical research park next-door, and Craigmillar.
The research park at Little France is expected to employ up to 6000 people in the coming years.
The proposed line would link in to two others - a loop linking the city centre with Leith and Granton and a line from Haymarket to the airport and possibly Newbridge - which are expected to start running in four years.
The Executive has provided 375m of the 473m cost of the first two lines.
Senior councillors now fear plans for the third line will have to be shelved for up to 20 years.
Councillor Anderson said: "The south-east of the city is one of the key areas of economic growth in Edinburgh and the business case for building a tram out there is far more robust than it is for the Waverley line. A decision at this stage to rule out funding is putting future development in this area at risk.
"It’s a crushing blow for the city that this has been effectively killed stone dead."
He added: "What we’re being told is that it would be a waste of time for us to submit a Bill [to approve the third line], as there is not going to be any funding available for the foreseeable future. I will be seeking an urgent meeting with Nicol Stephen on the issue."
The Executive said it cannot justify putting in any more cash into the project after awarding an initial 3.5m for preparatory work. It says that funding was granted on the understanding the scheme was to be funded by road tolls and contributions from developers.
An Executive spokeswoman said: "It is now up to the council to develop an alternative viable funding strategy.
"We are not prepared to underwrite the costs of further work on tram line three without a viable funding strategy, and believe the council should focus on delivering the projects for which it has funding."
City transport leader Andrew Burns said: "This is obviously a hugely disappointing decision, but it is also a direct consequence of the referendum vote against congestion charging.
"It was made clear by the council that the scheme was dependent on that.
"Our next step will be to take measures to safeguard the route of the proposed third tram line, while concentrating on delivering tram lines one and two."