Exclusive: Only two possible outcomes for trams

Published on Friday 3 September 2010 12:12

TRAM bosses are ready to move to tear up the contract with their German contractor if they cannot agree a deal to build the route as far as York Place, it has emerged.

• PLANS: TIE aims to persuade Bilfinger Berger to build the route as far as York Place before finding a new contractor

The Evening News understands that tram firm TIE has ruled out the possibility of opening smaller sections of the route, such as Edinburgh Airport to Haymarket, as they would not be financially viable.

Tram chiefs have instead set their hopes on getting Bilfinger Berger to build the line to York Place before advertising for another contractor to finish the route as far as Newhaven.

But if an agreement cannot be struck with the construction giant - a deal previously described as a "mature divorce" - then TIE will look to terminate the contract, a move which is likely to lead to a lengthy court battle and further delays to the opening of the route.

Insiders dismissed a suggestion that there is not enough money left to take the route even as far as Haymarket, but sources close to the consortium of which Bilfinger Berger is part are insisting that is true.

• Tram project: 'The city has been sold a pig in a poke'

A long-awaited report on the future of the project was expected later this month but has now been postponed until October.

It is understood that a team at TIE have been tasked with looking at plans for the "mature divorce" under the name "Project Carlisle."

However, failure to negotiate a deal with Bilfinger Berger will lead to tram chiefs beginning moves to rip up the contract.

One source said that option was the "next most likely outcome" after an agreement over York Place.

He said: "We will enforce the contract, which could lead to the tram being built very slowly over many years or termination of the contract.

"It would not be the first and won't be the last tram line finished by a different company from that which started it. But we are talking cancellation of the contract, not the project." John Carson, an outspoken critic of the trams and a former maintenance director at Network Rail, said the project was now a "busted flush."

He said: "If it's between building it to York Place and terminating the contract, then they will be terminating the contract because there's absolutely no way they have enough money to get it to York Place.

"I know people have doubted me, but to get the line to Leith it's going to cost a billion pounds and there's not enough money to get it to Haymarket.

"If you pulled the plug tomorrow, this project would end up costing the city more than 600m and we'd have nothing to show for it."

Earlier this week it emerged that TIE had lost a key adjudication battle which raises the possibility of workers downing tools when estimates have not been agreed for how much a piece of work will cost.

Shirley-Anne Somerville, SNP MSP for the Lothians, said: "It sounds like the best case scenario is that we're going to get half a tram line for all of the money.

"It's a complete slap in the face for people in Leith who have put up with so much and yet more evidence that nobody call tell us what we can get for our money."

A spokeswoman for TIE said: "There are a number of options currently under negotiation."