Trams cash row: 'The dispute has sparked a bitter war of words'

Published on Thursday 19 March 2009 09:22

DUE to the deep divides that have surfaced over the past few weeks between TIE and one of the main contractors on the trams project – Bilfinger Berger – an amicable solution to their differences seemed unlikely.

And so it has proved, resulting in a failure by today to reach a compromise over their cash dispute which, as expected, has led to the matter being referred to adjudication.

Under the terms of their agreement a single industry expert will now examine all the evidence, the claims and counter claims, and interview key personnel on both sides before ruling on whether the city must pay out more money to the firm, and how much.

The dispute has sparked a bitter war of words, with both sides attempting to influence public opinion in their favour. TIE boss David Mackay fired the first bullet almost exactly a month ago when he confirmed Bilfinger Berger was seeking more money before it would start work on Princes Street. Mr Mackay pledged to stand firm, pledging that the city would not be held to ransom, and he has stood by his word.

But the German firm has also refused to capitulate over its claim, said to be in the region of 20 million for works it says should have been done prior to its arrival on site. It is said to have 100 separate grievances.

Despite weeks of talks no middle ground has been reached by two sides who have remained determined to stand firm. It can only be assumed that both regard themselves as being in the right and we will have to wait until May to find out who will win.

That is all very well, but in the meantime a project that is already slipping badly behind schedule will face further delays. Mr Mackay has already admitted in an Evening News interview last year that it is "inevitable" costs will rise and this unwelcome dispute will do little to help him keep a cap on the final bill.

It was proposed initially to close Princes Street for one lengthy spell of eight months and to have the works completed well before Christmas. It is clear that this now cannot, and should not be allowed to happen. Even if they started in May they would overrun into the busy festive shopping period and the build up to the city's world-famous Hogmanay celebrations. And that is assuming that both sides agree to the outcome of the adjudication process.

Should either be deemed to be in breach of contract thereafter and the agreement terminated it could be a year before a new contractor could be brought on board. That, even at this stage, is unthinkable.