Tram correspondence and Council debt

Busy day - still catching up on all the tram-related communications from last week ... I think every piece of correspondence (and there have been hundreds of them) has now been duly replied to: I'd say there's been generally (though not universal) positive feedback on the position that Edinburgh Labour took on last week's debate.

With nigh-on £1.3billion of current debt, costing us 10% of our existing revenue budget in repayments, it simply seems unacceptable to me to commit ourselves to another +£200million worth of debt ... because that, in effect, is exactly what the Council has done :-(

In case you missed it, I'll simply repeat our Full Amendment below:

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City of Edinburgh Council Labour Amendment

Item 8.2 Edinburgh Tram Project

1. Council notes the report’s recommendations but does not agree them.

2. Council also notes that this is a project which Audit Scotland gave a clean bill of health in June 2007. Since then it appears to have totally unravelled.

3. Council further notes that the original Tram Project, and the subsequent contract sign-off on 1st May 2008, were predicated on the tram connecting Edinburgh’s Airport with Edinburgh’s Seaport/s and that the original project-scope is clearly no longer being delivered.

4. Council additionally notes that all political parties originally supported the principle of developing the Tram Project; and at the Council Meeting of 1st May 2008 all five political parties on the Council agreed to the final sign-off of the current Tram Contracts.

5. Council acknowledges that the city urgently needs certainty on this project and that Scotland - and its Capital city - should see benefit for the money thus far invested.

6. Council thus agrees:
• That no commitment to additional Council funding, beyond the existing contractual commitments, is entered into
• That additional funding will be provided via the disposal of equipment that is no longer required for the reduced scope referred to below
• That the proposal with least construction risk, is to build from the Airport to Haymarket as phase one of a longer-term, strategic plan only should funding become available
• That prior to final commissioning of phase one, the Business Case for Airport to Haymarket is reassessed in the light of economic circumstances at that time
• Thus to review and revise the business case for phase one so that it can be assessed whether it can be delivered without requiring an operating subsidy; ensuring that Lothian Buses are not at risk of having to cover such subsidy
• That Lothian Buses are given a primary role in reassessing the Business Case, to ensure maximum operational income and public transport service integration
• That these measures will ensure a fully operational tram line from the Airport to Haymarket (as phase one of a longer-term, strategic plan) by mid-2014
• and the Chief Executive is thus instructed to seek to finalise such contractual requirements as necessary with this:
- certainty of destination
- certainty of price
- certainty of delivery date

7. Council also instructs:
• That the finalised terms of the Settlement Agreement should be delegated to the Chief Executive to take forward, following consultation with political group leaders. The Chief Executive is thus authorised to enter into the Settlement Agreement substantively on the terms set out in the Settlement summary, contained in the confidential appendix, with such amendments as may be necessary to reflect the above and as may be considered appropriate and following consultation with political group leaders
• That the Chief Executive explores whether or not it would be possible to obtain an option, exercisable by the Council, for proceeding with Haymarket to York Place once more information is confirmed about the risks and funding involved
• Further, to authorise tie Ltd to progress the priority works, in accordance with MoV4, and incur expenditure as referred to in paragraph 7.8 of today’s report
• The Director of City Development to finalise, in consultation with political group leaders, revised governance arrangements for the final delivery of the project
• That, as shareholder, Lothian Buses is asked to assist in preparing for operations, by accepting a share transfer of ETL, subject to staff consultation, as soon as possible.

8. Council finally notes that as at March 2007 some £44million had been expended on the Tram Project and, by that time, two full Parliamentary Bills had received formal approval and were on the statute book. Expenditure on the Tram Project today (30th June 2011) stands at over £460million, indicating that some £100million per year has been expended, for the last four years (2007-2011), yet still no trams run on the streets of Edinburgh.

9. Council deplores this apparent failure, to date, of the SNP/Lib-Dem Administration to successfully deliver any operational element of the Tram Project for Edinburgh.

10. Council therefore confirms it has no confidence in the current SNP/Lib-Dem Administration; and calls for the Council Leader and Deputy Leader to consider their positions and resign with immediate effect.

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