Scottish Government agency Transport Scotland should become more involved in the management of the Edinburgh Tram project, a report into the beleaguered scheme project has stated today.
The report by Audit Scotland said that the City of Edinburgh Council and the body set up by the council to deliver a tram system for Edinburgh, Transport Initiatives Edinburgh (TIE) urgently need to establish a clear way ahead for the project as “public confidence in the project is extremely low”.
The project, which is the fourth largest public capital project in Scotland, has been beset by delays and cost increases caused by a greater than anticipated amount of work in moving utilities such as water and gas from the line, and a contractual dispute with the the Bilfinger Berger Siemens consortium responsible for infrastructure construction.
So far, £402M has been spent on phase 1a, which is intended to run from Edinburgh Airport to Newhaven. This is 74% of the total £545M funding currently available, but only 28% of infrastructure construction works have been completed against an original plan of 99% by the end of December 2010. Work on the project has “essentially ceased” due to the dispute, TIE has said.
£500M of funding is provided by Transport Scotland, and Auditor General for Scotland, Robert Black said: “Transport Scotland has committed £500M to the trams project. Given this significant interest and its expertise in managing major transport projects the Scottish Government needs to consider whether it should become more actively involved to help avoid possible further delays and cost overruns.”
Until the contractual dispute is resolved the total cost of completing the line cannot be accurately estimated, although the report states it is clear that it will not be completed within budget. It is possible that trams will not be operational until at least 2013, almost two years later than originally planned.
TIE is now considering the completion of phase 1a in incremental stages due to the difficulties experienced so far. However, Audit Scotland says that TIE must clarify the cost of this initial section to St Andrew Square in central Edinburgh, and the other sections of phase 1a which would be delivered later.
The report does not include a detailed review of the various works contracts or express any opinion on the project’s management or the performance of any of the contractors involved. Audit Scotland said this would be inappropriate due to an ongoing contractual dispute between TIE and the consortium, which may be the subject of future litigation.
A mediation process is planned between the two, which is expected to be completed by mid March, but TIE has stated that other options, including terminating the contract, remain open.
The report was undertaken by the Auditor General for Scotland and the Accounts Commission, and Accounts Commission chair John Baillie said: “Mediation talks between the City of Edinburgh Council, TIE and the Bilfinger Berger Siemens consortium are due to take place soon. It is important that these talks are pursued and that all other choices including the consequences of terminating the contract are fully considered and evaluated. Public finances are tight and it is crucial that any solution must represent value for money.
“Communication about the trams project could also be better. Public confidence in the project is extremely low. The City of Edinburgh Council and TIE urgently need to better explain to the public how this complex project is progressing.”
Black added: “It is very unusual to conduct an audit of a live project but the Accounts Commission and I decided that an interim report was needed because of the public concern and the risks associated with the project.”