The latest update on the Edinburgh Tram Project is set to go before Councillors next week.

The report, to be presented to the Full Council meeting of the City of Edinburgh Council on Thursday 24 June, will set out the current position on construction progress, the contractual dispute, tie’s strategy for resolving the dispute along with options for moving the project forward.

Whilst progress is behind schedule, the report details that works on the off-street section of the route, including the tram depot at Gogar, the bridges at Edinburgh Park and Carrick Knowe, the guided busway and the viaduct at Haymarket are now advancing. Construction and testing of the fleet of 27 tram vehicles is well underway with the first tram now on Princes Street as a popular public exhibit.

The massive job to divert utility pipes and cables increased by some 85% above the amount originally programmed, this work is now substantially complete and is a considerable betterment of the city’s underground infrastructure.

Since early 2009, much of the public focus of the project has centred around the contractual dispute with the Consortium of Bilfinger Berger, Siemens and CAF (BSC).

The report notes that relationships with two of the contractors, Siemens and CAF, remain largely positive. The dispute is largely related to the infrastructure installation works and there are three areas which make up the current impasse:

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* The apparent adoption by BSC of an approach of not progressing works where there is a change, or alleged change, to the contracted scope of works until the financial entitlements from the change are definitively resolved. This appears inconsistent with the terms of the Agreement which states that works be undertaken while a resolution is found.

* Design-related matters. While the agreement reached by all parties was for a fixed-price lump sum contract, tie has accepted that certain elements are legitimate additions to the price. For example; extra demolition works and soft-ground treatment. The issue at dispute is whether individual matters constitute changes to the original scope of works and whether a change to the design justifies additional payment. A formal contractual process, known as Dispute Resolution Process (DRP) has been employed to find solutions for these individual issues.

* Delays to programme caused by further time required to complete additional utility diversion work. tie has already offered what they determine as a reasonable amount of time to add onto the works programme, however agreement has yet to be reached.

Cllr Gordon Mackenzie, Transport Convener at the City of Edinburgh Council, said: “This report brings much greater clarity to the people of Edinburgh regarding all aspects of the tram project. It also dispels some of the myths that others have used politically regarding potential levels of overspend.

“As a public body, the Council must prudently manage any risk and the Directors’ suggestion of adding a 10 per cent contingency figure is reasonable to work with as we look at our various options.

“Of course if we were not in dispute with the contractor there would be no need to do this. While signs of progress at the west of the city, tram vehicle production and the finalisation of utility works are welcome, we are by no means in the position we would like to be. I am fully-supportive of the lengths tie’s management have gone to in trying to resolve the contractual dispute against a background of continual frustration and public scrutiny."

(GK)