Insanity in Edinburgh

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by Hazel Lewry

Friday, 02 September 2011, and Edinburgh council has done it again.  That they could abuse, misuse and betray the trust and faith of the electorate as they had until then was the stuff of fairy tales or Union Cabals.  What followed beggared belief.

As usual the issues that stagger incredulity were buried in the fine details.  The major point on every agenda is that the SNP are now also thoroughly tarred with the stupidity brush which has been painting Edinburgh council chambers.

Let us be clear on several issues, trams tend to be a good thing.  They reduce pollution and are reasonably clean and quiet.  I’ve ridden on tram and trolley services in many parts of the world and had no complaint.  I like trams and trolleys, I support quality public transport.

After the latest council reversal in Edinburgh council officials estimate the line can generate an annual profit of £2 million but will require a £231 million loan to complete if it goes to St Andrews Square.

A 115 year plus payback schedule is not intelligent use of public funds, certainly no private company would go for it.  The asset will possibly need replaced five times over before it’s actually paid for.

Let’s be clear, infrastructure assets are nominally 30 year life projects.  The project will be expected to “die, terminate or be replaced” by about 2045.  Edinburgh could well be paying a century past that.  How then to pay for its replacement?

Add in interest at about 5% or around £12 million a year and it’s a never payback scheme.  It’s a £10 million a year white elephant for the good people of Edinburgh.  This is not education or a hospital, it’s an Iain Gray and Labour vanity scheme.

This is close to insanity, but it’s nothing in comparison to what was to come.

In the special session of council, called after the Scottish Government intervened following the Haymarket vote saying it would withhold the remaining £72 million from its agreed contribution, the councillors were forced back to the table.

Councillors basically had until 5pm to hammer out a deal, or contractor Bilfinger Berger (BB) could find them in breach and terminate the contract, which with hindsight would be no bad thing at all.

If the project has any viability another entity will probably pick it up, perhaps even expand upon it.  If that doesn’t happen it confirms the decision was most likely correct anyway.  Either way it appears a win-win for the citizens of Edinburgh.  Expanded service or capped costs.

Let the council’s arms’ length company TIE go bankrupt.  BB can’t get blood from a stone, unless the council did something equally insane like underwrite the project with local guarantees.

Apparently the council session lasted a while.  It took councillors around three hours and four rounds of voting to make a final decision, voting 28-15 for the Liberal Democrat motion to pursue the line to St Andrew Square.

The motion passed this time because the SNP group altered their position and supported it after abstaining in the last meeting which allowed Labour’s ludicrous Haymarket proposal to pass with Tory support and potentially encumber Edinburgh with a greater perpetual deficit.

So far the project smacks of less than competent administration, and I’m being extraordinarily kind with that statement.  But with the amount already ploughed into Iain Gray’s vanity, the attempt to salvage something appeared reasonable.

It’s worth noting that the final decision was only approved after the Tories again lodged an amendment to tear up the tram contract and re-tender it.  Allegedly this meant an estimated £160 million cancellation cost, borne by TIE presumably, except TIE is apparently effectively bankrupt without Scottish Government support.

The Tory motion was defeated in the second round.  Ultimately it might have been the most sensible item laid on the table at those meetings.

This is where I have extreme exception to the final resolution, it was passed authorising council chief executive Sue Bruce to enter a settlement agreement with the contractor on “an unconditional basis as to funding”.

Let’s repeat that wee statement, “An unconditional basis as to funding”.  No limits on money.

Sue Bruce has been authorized to agree to spend whatever number she deems appropriate.  There is no limitation implied or inferred here as to what either Edinburgh or Scotland can afford.

What planet are these people living on?

Moreover this is now public knowledge. Ms. Bruce has to enter negotiations with the contractor when the contractor already knows there is no credible hard ceiling to what she’s authorized to spend.

I’m struggling to find any place that recommends this to be an effective and competent negotiating technique.

Perhaps this is simply the council’s way of stating it expects the additional funding required to take the line to St Andrew Square to remain within the £231 million envelope.  But based upon this project’s history of incompetence and concealment we should expect costs to soar beyond that.

The only crumb of comfort came from Ms Bruce herself who stated: “What we now have to do is go away and first of all speak to the contractor to confirm that funding sources have been identified, and to seek to extend the time from 5pm tonight for another week or so to try to get the contract details nailed down.

“Also, I would want to go back to Transport Scotland and the Cabinet Secretary to see if the decision that the council has made will be sufficient for them to reinstate funding.”

The SG still has that £72 million.  It can use it to improve other public infrastructure in Edinburgh or elsewhere. Upgrade a couple of hospitals, perhaps a new school or two.  It should not throw good after bad into a project that has already been a disgrace to our capital city.

John Swinney can make a decision.  John Swinney must make a decision, and it shouldn’t allow Edinburgh to continue writing blank cheques on anyone’s account on behalf of Iain Gray and the Unionist parties now elephantine vanity project.

Meanwhile, Edinburgh council leader Jenny Dawe said, “Everything has been done to make these figures as accurate and as good as possible”.

Jenny, after previous disclosures and consistent continual cost “overruns” added to that caveat of all caveats, “an unconditional basis as to funding”.  If you can’t cap the funding, you simply don’t know, and your statement is quite bluntly not worth drawing breath to make.

The last statement from Ms. Dawe was re-enforcement of the fact that the above was nonsense and the council have no clue, “The best estimate I could give for trams running on the test track would be possibly early next year.  I believe it may be into 2014 before we have a commercial service running, but that is just purely a guesstimate.”

If you don’t know the timetable, the basic project duration, how can you possibly calculate the costs?  How can you expect anyone to believe you.

Sadly the SNP by not tabling an amendment to cap the nonsensical nature of the project funding have also become gripped in the stench and mire of the trams project.

There really is only one sensible, democratic, honourable way forward.

The SNP group must table a motion for the resignation of the entire council over this affair. If the council will not agree en-masse, then the SNP group should resign imminently.  The resignations could be delayed, but should be tendered immediately.

In my opinion it’s about the only way forward for the nationalists that might yet salvage some little credibility and honour.

John Swinney, it really is your move, because without our money that you hold, the decisions of Edinburgh Council and TIE are largely worthless.

We need legislation to make these massive projects truly democratic.  That is a basic right in any democracy.