Scramble to rescue city centre tram line

A special meeting of the full council has been called, at which the Liberal Democrats will seek to overturn last week’s vote to stop the line at Haymarket rather than carrying on to St Andrew Square.

Council chief executive Sue Bruce flew to Germany yesterday for talks with representatives of the construction consortium headed by Bilfinger Berger. The administration said she was told they would charge much more than the original estimated cost of £700m for building the line to Haymarket.

It was also claimed the consortium had warned it would treat the council as being in breach of contract if it does not get a final decision on whether to build to Haymarket or St Andrew Square by midday on Friday.

If no decision is made by that time, the contract termination clause would be invoked, leaving the council facing an immediate £161m charge that it would have to strip from this year’s budgets.

The Lib Dems, the largest party on the council, are expected to argue that the Haymarket option – pushed through last week by Labour and the Tories – is too costly and the route should continue to St Andrew Square, although that will mean borrowing £231m and paying off the loan at £15m a year for 30 years.

The increased costs for Haymarket - estimated at around £30m - are understood to relate partly to the need to build a turning circle if that is to be the end of the line.

Transport convener Gordon Mackenzie said: “As the Tories and Labour were warned, the contractor has indicated that they are not happy with this change and there is going to be increases in price. They are going to write to us with details of that.

“The reason we have to have the meeting on Friday is the contractor has made it clear they need a decision by midday on Friday, or the contractor will see us as being in breach of contract.”

The meeting has been called for 10am, leaving councillors with only two hours to come to a decision.

Cllr Mackenzie said: “The last thing that we want to do is have a meeting for two hours to have Labour and Tory councillors asking questions of officers and not get a decision. We need to have as much time as we can to look at costs, but there is a deadline.

“This was predictable. The council was warned this could happen and that the contractor could turn round and say they are increasing the price as a result of changes in scope.

The official calling notice for Friday’s meeting also notes that the Scottish Government would review its funding if the route was limited to Haymarket.

Cllr Mackenzie said: “I would like to see the other parties look at the options. Just now, Haymarket is the option the council has chosen but the vast majority of people think that is the wrong option and I hope that, in the next few days, there will be movement in the other parties. I do not think that is unrealistic.”

Tory group leader Jeremy Balfour said he and other group leaders were being briefed tonight on the latest development and the Tories would then decide their position. “Until we know exactly what is going on, it is difficult to say what is going to happen next.”

Cllr Andrew Burns, leader of the Labour group on the council, said: “Rather than trying to unpick the decision, they should be getting on with delivering the will of this council.

“It sounds like a desperate attempt to justify St Andrew Square at any cost. If the figures we got in June or August are incorrect, that is very serious because it means we have been given false information.”

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