Edinburgh councillors reverse decision on trams

It comes a week after Labour and Conservative councillors rejected plans to borrow an extra £230m to run the line into St Andrew Square, instead agreeing to take the tram line from the airport to Haymarket, which is outside the city centre.

But councillors today reversed that decision, with SNP members backing their Lib Dem coalition partners. Labour also decided to back the decision for trams to run into St Andrew Square.

Today’s decision comes after the Scottish Government said it would withhold £72m from its agreed £500m contribution if the trams stopped at Haymarket.

Finance Secretary John Swinney said: “The government has made clear to the City of Edinburgh Council that a proposal which takes the tram system to Haymarket, that requires ongoing public subsidy in the years to come, is a significant departure from the original concept that the government supported, and which it was prepared to put forward £500m for.

“As a consequence of that we are just not prepared to make available any further funding to the city council.”

The trams project has been dogged by delays, cost-overruns and a legal wrangle with the private consortium contracted to deliver the project.

Costs have grown steadily, with estimates now reaching more than £830m to complete just two-thirds of the route – more than 50 per cent higher than the original budget for the entire project.

A report to councillors ahead of the meeting recommended they agree to take the tram line from the airport to St Andrew Square near the east end of Princes Street.

It estimated that having a tramline from the airport to the square had the potential to generate an annual profit of £2m but would require a £231m loan to complete.

The latest document, published on Thursday, says that travelling into the city centre would “yield the best prospect of a return on investment” and help “deliver best value for the city, the council and the Edinburgh tram project.”

Other proposals in the report include the offer of extra support for businesses affected by the works.

The tram was originally designed to run from Edinburgh airport, on the western fringes of the city, to Newhaven on the banks of the Forth at a cost of £545m.