Foreign cash may bail out trams

EDINBURGH council chiefs have claimed that finance from overseas firms could be a possible “funding avenue” for completing the route of the Scottish capital’s troubled trams project.

The claim comes after councillors backed a plan to build the tram line to St Andrew Square, leaving officials with just two months to make up a £228 million shortfall.

City council leader Jenny Dawe has said she had received a number of inquiries from well-known global companies interested in completing the line to Newhaven.

A council spokeswoman told The Scotsman that “experience from elsewhere” – such as a €150m extension to the Dublin tram system involving private finance – showed that kind of scheme was a possible option for completing the line in Edinburgh.

Councillor Gordon Mackenzie, the council’s transport leader, said the authority was exploring the possibility of a private firm building the remainder of the 11.5-mile route and allowing the council to rent it back.

He said he had received a “couple of approaches from different companies”.

But Jeremy Balfour, leader of the Tory group on the council, warned that the authority’s leaders “should tread carefully” about committing more tax- payer cash to the scheme, which is expected to cost at least £200m more than the £500m in funding capped by the Scottish Government, and is also three years behind schedule.

Ms Dawe said the focus was on finding the cash needed for the rest of the route, but there had been a great deal of interest in the future of the project.

She said: “The challenge now is to find the money. I have to say there is no shortage of ideas coming forward and I have been surprised by the number of e-mails I have had from all over the world – some from well-known companies.”

The council suggested that the opening of a third extension just days ago to the Dublin tram system, which received more than half of its funding from the private sector, showed a possible way forward.

Fifty-five per cent of the funding for the scheme to extend the western branch of the Dublin line came from the Citywest Luas grouping of landowners and business interests based in the Irish capital.

A spokeswoman for City of Edinburgh Council said: “Experience from elsewhere has shown that once a line is operational and successful, there is an appetite for extensions.

“Private sector investment is one funding avenue used for future expansion of tram systems, but all options will be explored at a relevant time in the future.”

Mr Balfour said: “I would want to tread carefully, as I would want to be sure that we get an integrated trams and bus system in Edinburgh, and we would also need to know who would be involved and what price they would charge.”

He added: “We need to focus on finishing what has already been agreed, if it is financially possible.”