Tram project ex-boss to get bonus despite walking out

Published on Tuesday 16 June 2009 22:45

THE controversial former boss of the Edinburgh tram scheme is to pick up a bumper cash bonus – despite plunging the project into chaos by walking out on his job last year.

Willie Gallagher, former chief executive of the city council's tram firm, will get 41,000 in bonuses despite the tram network running into a string of problems since his departure.

This works out at 270 a day on top of the 170,000-a-year salary he was on for his work with tram firm TIE from April-November, when he left abruptly.

TIE officials insist he was merely being paid for contracted bonuses, adding that the package of benefits for staff is being slashed from about 600,000 a year to 100,000.

Several senior managers are said to have agreed to defer promised bonuses until the completion of the project in a gesture of goodwill, while a further review of the bonus structure is under way.

Although Mr Gallagher did not pick up a pay-off when he resigned from TIE, he was due cash from a bonus structure that would have seen him pick up a total of 340,000 if he had stayed in his job.

It emerged in April that almost 1 million in bonuses had been paid out on top of salaries for staff – defended by TIE as "normal business practice". The figure did not include bonuses for the most recent financial year, when the bulk of construction work began.

Richard Jeffrey, TIE's new chief executive, said: "Bonuses are an important tool in the recruitment, retention and motivation of staff.

"It is right that outstanding performance is rewarded, but equally we cannot ignore the environment we operate in and the current status of the project," he said. "For example, some individuals have been to extraordinary lengths during the difficult negotiations with contractors."

Council transport leader Gordon Mackenzie said: "The payment of bonuses to Mr Gallagher was a contractual obligation which TIE honoured. With regard to payments in future, it is important for public confidence that bonuses are linked more closely with the overall performance of the tram project."

SNP MSP Shirley-Anne Somerville said: "People are rightly outraged that well-paid tram bosses have been pocketing public money while (the public] have faced nothing but chaos and delays.

"Staff are already paid to do their jobs and the public don't expect to pay people twice. I am pleased that TIE has been forced to cut back on the worst excesses, but I will be keeping a close eye on developments to make sure they (TIE] are held to account for every penny they spend."

Mr Gallagher was unavailable for comment.

LONG LINE OF TROUBLES

WILLIE Gallagher quit his post just weeks after an attempt to close part of Princes Street left city centre traffic crippled and months before a bitter dispute with a German-led construction consortium stalled work on the thoroughfare. The project suffered another major blow earlier this year when it emerged it had ran out of money for a crucial link from the city's waterfront to the Haymarket area.

A planned embargo on city centre tramworks during the summer festivals has since had to be scrapped, the cost of the project has risen from around 512 million to up to 545 million, and the planned opening date for the scheme in July 2011 has been shelved.