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Rail: Tramspotting

Edinburgh’s much maligned tram work appeared to have turned a corner last year. Declan Lynch visits the new team heading the project.

No major civil engineering project is without its faults and disputes. But what makes the Edinburgh Tram project different is how those problems have been played out in front of the residents of the city, and the inability of the parties involved to resolve the disputes.

The Edinburgh Tram was originally planned to run from the airport in the west, through the city centre and on to the old port of Newhaven in the east, a track length of 18.5km, costing £545M and opening in 2011. It will now terminate at York Place in the city centre, running for just 13km, at a cost of £776M and an opening date in 2014.

Construction began in 2008, but the project quickly ran into trouble and client Transport Initiatives Edinburgh (Tie) - an arm’s length company set up by the City of Edinburgh Council (CEC) to run the tram project - and the infrastructure contractor (Infraco) - a consortium led by contractor Bilfinger Berger, and including engineering giant Siemens and train manufacturer Caf - found it impossible to work with each other (see box).

Disputes over the project reached a crescendo last summer with Infraco downing tools. With all parties blaming each other for the fiasco there was a very real possibility of the project being abandoned despite £460M already having been spent. With the project in limbo and half-finished works sites littering Edinburgh city centre, something had to be done.

“Eighteen months ago we were in a dark place,” says special advisor to the council Colin Smith, who was brought in by new CEC chief executive Sue Bruce to get the project back on track.

“No respect”

“There was no respect, mutual trust or anything like a partnership working together,” adds Smith. With the project less than half-finished in 2011, the year the trams were due to be running, mediation eventually began.

During this process the project was split into three areas - legal, design and principle, says Smith, with “the real problem being mind-set”.

Five days of intensive negotiations in March 2011 resulted the drafting of “Minute of Variation 4” of the contract between CEC and Infraco, allowing the contractual dispute to be resolved.

It also allowed work to restart immediately on key elements of the scheme such as at Princess Street in the city centre, GogarDepot and the test track, while the bigger issue of how the overall scheme would be finished and funded could be decided later.

Following a summer of dispute over where the tram should finish - a shortened route to Haymarket costing £700M or a fuller route to St Andrew Square at £776M - September saw a decision to terminate the line at St Andrew Square (although this was revised later to York Place). The full original scheme to ­Newhaven was finally ­abandoned at that point.

At the same time original client Tie was wound down and the project taken back in-house by the council, supported by cost consultant Turner & Townsend.

Smith says failure to control the project in the first place was down to CEC placing its trust in Tie, and that CEC is now “taking a much more hands-on approach”.

The negotiations resulted in an agreed settlement and the council taking out a £231M loan to pay for the work. The new settlement gives much greater clarity of roles between the client and contractor -another key reason for the original dispute, according to Smith. “There’s no opportunity for any misunderstanding,” he says.

Also gone is the original Multi-Utility Diversion Framework Agreement (Mudfa) contract which failed to clear all the utilities prior to Bilfinger Berger starting line construction. Now contractor McNicholas is diverting utilities for CEC before the site is handed over.

“We’re clearing utilities like a bore wave,” says Smith of progress now.

More proactive

Risk of moving utilities remains with CEC, but there is now a more proactive approach to solving problems, compared to the litigious manner pursued previously where work was stopped pending resolution.

Smith says that if any change is required then there are ­mechanisms to resolve the problems - something that clearly didn’t happen under the previous arrangement.

Since September’s settlement significant milestones have been hit, including completion of Gogar Depot in December 2011, crossover section of track at ­Haymarkets Yard in February and the Mound reopening to vehicles in March.

Work on Princess Street was completed this month, and the last major on-street works at York Place has begun.

This section from Princess Street to York Place - where the tram service will eventually terminate - is now critical.

Contractor McNicholas began complex work to divert utilities on York Place this month ahead of Infraco’s work to install final sections of track knowing that only £34M remains in the project’s contingency fund.

Engineers privately express their doubts that the £34M contingency fund will be able to cover any potential problems at York Place

Any cost overruns as result of additional utility works needed on this latest York Place section will now have to be met by ­Edinburgh City council.

Edinburgh city council transport convener councillor Lesley Hinds says that the work is the final major area of tricky on-street engineering work for the tram project, but that he is confident it will be delivered on current time and budget.

“The biggest challenge is York Place,” says Hinds, referring to the utility diversion difficulties already experienced elsewhere.

“My understanding is that [the project team] are reasonably confident they know what’s underneath the surface,” she adds. “But Edinburgh’s an old city and you could find cellars and graveyards.”

Engineers privately express their doubts that the £34M contingency fund will be able to cover any potential problems at York Place.
Only last week McNicholas damaged a gas main causing work to be temporarily stopped at the Haymarket in the city centre.

Under the contract, McNicholas must move any utilities and provide a clear site before contractor Bilfinger Berger can begin construction of the tram infrastructure. All construction work is due to finish at York Place by March 2014.

Meanwhile the test track between the depot and Edinburgh airport is due for completion by spring 2013, and new bridges will be installed at Balgreen Road, Roseburn Street and Russell Road by the end of the year.

Tram construction delivery is due for completion by early 2014, with revenue services beginning in the following summer.


How did the project go wrong?

While work continues on Edinburgh Tram - residents and engineers alike will still wonder how the project could go so wrong, and whether the project was even necessary in the first place.

Many close to the project put much of the blame on client Tie, as well as CEC.

Conservative councillor Jeremy Balfour believes the council and public were misled by Tie and officers at CEC.

“The original contract price was meant to be 95% fixed but I don’t think that was legally the case,” says Balfour.

He adds the contract signed between Tie and the Infraco left “very little wriggle room” for Tie.

But one source close to the project told NCE it was Tie who developed the contract that has caused many of the problems.

“It was a bespoke contract largely developed by Tie,” says the source. “It led to problems and caused a degree of misunderstanding.”

Hiding information

Balfour added that he believed Tie was also “hiding information from the council and being litigious on the wrong grounds”.

To understand how Tie got into this position it is important to look at how the project progressed from its conception.
CEC created Tie in 2003, and tasked it with developing the tram route, along with plans for a congestion charging scheme which was rejected by residents in 2005.

Tie immediately split the project into three and set about awarding contracts for design, utility diversion and tram infrastructure.

System Design Services - a joint venture between consultants Halcrow and Parsons Brinckerhoff - was awarded the contract to design the network in 2005 and contractor Carillion got the nod soon after, in 2006, for the Multi-Utility Diversion Framework Agreement (Mudfa).

The key reason for the haste was to ensure the project could not be scuppered by a likely change of power following the looming 2007 Scottish Parliament elections. The Scottish National Party (SNP) had opposed the project from the beginning and was set for a comprehensive victory.

“Everything was done in such a rush,” says Edinburgh resident and former director at contractor Miller John Carson. “Tie wanted to get the project through legislation and building before the 2007 election.”

SNP duly defeated Labour, who had supported the tram. But the early work paid off and with the project so far advanced, SNP felt obliged to grant the £500M needed from central funds.

CEC promptly provided the remaining £45M and the final go-ahead was given in October 2007, with the Bilfinger Berger-led Infraco consortium awarded the main construction contract in May 2008.

Construction proper began soon after and almost immediately ran into problems caused by late running utility diversion work. Carillion’s Mudfa contract began in July 2007 with a planned duration of just 70 weeks - with the intention of giving Bilfinger Berger a clean run at installing the tram infrastructure in Autumn 2008.

But a source close the construction consortium said nowhere on the project did this clear run happen.

Unanticipated work

Carillion had to move far more utilities than had been originally anticipated, and it ended up agreeing with Tie to end its work in November 2009, and contractors Clancy Docwra and Farrans were brought in to finish the utility works - work that is still ongoing.

Yet although there were clear problems with utility diversions, this was not being communicated in official tram update documents. A tram sub-committee report from March 2010 reported that 97% of the utilities had been diverted.

A source close to the project told NCE that this figure was inaccurate, particularly given McNicholas has been diverting utilities since September 2011.

Balfour agrees that Tie was not producing accurate information.

“We were given the impression that everything was rosy,” he says.

Meanwhile, the contract signed between Tie and the Infraco was also causing problems. When the Infraco contract was signed in 2008, SDS’ design was passed over to it incomplete. A change mechanism was put into the contract to allow for proposed changes to the incomplete design.

But when these design issues came up, Tie refused to accept many proposed changes, instead opting for independent arbitration to settle the dispute.

The first of these disputes to reach the press was at Russell Road near Murrayfield in January 2010.

NCE has seen documents that show Bilfinger Berger proposed a change to a retaining wall next a railway line. The original design called for an ‘L’ shaped gravity structure, but Bilfinger Berger wanted to change this to a cantilevered wall founded on piles.

Tie refused to accept the changes, but was ordered to make the changes by the independent arbitrator.

The dispute was typical of many within the project as relationship between Bilfinger Berger and Tie broke down, ultimately leading to work stopping on site in mid-2010.

While the Scottish Government and CEC stepped in sort out the project in 2011, many feel the problems surrounding Tie could and should have been solved much earlier. A public inquiry into the project has been promised once it is finally complete, but there is no firm guarantee on when and where it will happen.

If the inquiry does go ahead then engineers on the scheme will face some awkward questions; not least why such a unique contract was used when so many others were available, and why CEC and the Scottish Parliament didn’t properly monitor the project.

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