Edinburgh Christmas festival: Council could face legal action over claims it flouted contract rules

Edinburgh’s Christmas festival ‘at risk’ as council faces backlash over contract failures

Edinburgh City Council could face legal action over the Christmas festival amid allegations the award of last year's contract flouted rules.

It comes after a spate of controversies around the festival, with doubt now having been cast over the future of Edinburgh’s Christmas, which includes the Christmas market, George Street ice rink and a programme of events.

A report has been raised through Safecall, the council’s whistleblowing service, over the handling of last year’s contracts. It follows the collapse of the contract in 2022, when organisers backed out, resulting in £3 million in losses for the council.

Edinburgh’s Christmas festival in 2022 collapsed, resulting in an emergency contract award to deliver it last year

After Angels Events Experience walked away from the contract, Unique Assembly Ltd were given an emergency contract and subsequently a one-year extension. Now the consortium is also in the running for this year’s event, along with two other bidding companies. But it has sparked fresh anger over an alleged lack of transparency and fair process.

Now several companies are seeking legal advice over alleged breach of public contract tender rules – as the festivals are plunged into controversy once again.

A source close to the event said: “The council took the festivals off a company and gave it to another company ... then extended their contract unchallenged for 2023. Since 2022, all contract decisions have been closed room briefings.”

The source added: “The council knew the tender rules and let it slip through anyway, then extended it without due process. They could face a judicial review if other companies knocked out decide to pursue legal action. They shouldn't be allowed to get away with it."

An investigation was launched into claims senior council officers misled councillors over the botched 2022 contract, following a complaint from the main contractor’s business partners.

After Unique Assembly Ltd were given the contract, council bosses said they ‘rescued’ the festival, delivering it at short notice. Following a successful Christmas again in 2023, the contract was extended based on performance.

Concerns about planning delays and implementation had been raised “for months” with the council when the 2022 contract collapsed.

But it is claimed the emergency contract was a "done deal" within hours after Angel Events backed out in September 2022. Councillors didn’t ratify it until two weeks later at a finance committee meeting in October.

Despite backing out, bosses of the company were then involved in the running of the festival in 2022.

Sources said many were “uncomfortable” that Angels managing director David Kohlert remained in charge of the festival’s Christmas market in 2022. In an email seen by The Scotsman, Mr Kohlert told his business partner he was “confident” they’d be back trading – after reneging on the contract.

The company, which runs Winter Wonderland in London’s Hyde Park, had a number of local traders already in place for stalls at Edinburgh’s Christmas 2022 and the council said it wanted to “support” local businesses.

Concerns were raised by a finance officer about lack of scrutiny around the 2023 contract, following promises from the council to have an “open book” approach after the 2022 debacle. The authority has declined to share accounts for the 2023 event.

Ian McAteer, chairman of the Union Group, said: “If it is indeed the case that the companies bidding for the festival’s finances do not meet the requirements stipulated in the tendering process, then questions should be asked as to why they are allowed to tender. Given our experience from the abortive Angel Event Experience Ltd tender, where we discovered they had in fact set up a shell company and thereby avoided liability, I think it is vital that the council is clear on who it is dealing with.

"The 2022 event resulted in several Edinburgh companies, including ours, left out of pocket, and the council washed their hands of us. Is it incompetence or something more? The bottom line is that the council is aware that Edinburgh businesses were effectively defrauded. They refused to help us and a number of other companies. We were thrown to the wolves, and together local companies lost more than £120,000."

A spokesperson for Unique Assembly Ltd said: “Following the stepping back of the winning tenderer for Edinburgh’s Christmas contract, an emergency one-year and subsequent one-year extension was awarded to Unique Assembly Ltd to deliver Edinburgh’s Christmas 2022 and 2023. This emergency award was not part of the original Edinburgh’s Christmas tender, and the historic finances outlined showing subsequent losses incurred from the project, but do not reflect the current financial position of the company or our ability to deliver future contracts.

“As Unique Assembly, we are immensely proud of our part in delivering both Edinburgh’s Christmas and Edinburgh’s Hogmanay over the last two years, projects which we have invested significantly in delivering to huge success for the city. We can make no comment regarding the current bid during the tendering period.”

Council leader Cammy Day said: “Following the termination of the contract for Edinburgh’s Christmas in October 2022, we had to work quickly to find a suitable alternative under a very tight timescale. The process for the emergency award was followed properly.

“We’re committed to putting on the highest calibre events possible for our residents and visitors, and we’ll be working closely with the organisers and other partners as we prepare for the 2024 edition and beyond.”