Trams Still In Limbo After War of Words

When the long-running tram dispute boiled over into a public row this week, we got a brief insight into just how rancorous relations have become between Edinburgh trams company Tie and its contractor Bilfinger Berger.

Outgoing tie chairman David Mackay's comment to The Scotsman on Wednesday 3rd November set things off: "Bilfinger Berger was a delinquent contractor who scented a victim, who probably greatly underbid and who would use the contract to make life extremely difficult for the city. And they have done exactly that," he said.

Words can be slippery in meaning, and Mackay's choice of the term “delinquent” became at issue.

While delinquent is widely used as a conversational pejorative, it has clear legal connotations. The Chambers Dictionary defines delinquent as “someone, especially a young person, guilty of a minor criminal offence.”

Richard Walker, Managing Director of Bilfinger Berger, says the company couldn't accept the potential damage to its reputation from the implication of criminal activity “however small or large” .

“We thought that crossed the line,” said Walker, speaking yesterday. “Surely you can appreciate if we're going for a tender and someone says, 'Well, hang on, you've been accused of procuring a project by criminal activity, well are you doing it on this one?'”

A defamation action was served on Friday, but was resolved “on the steps” of the Court of Session on Tuesday. Bilfinger Berger dropped the action after receiving a statement from Mackay's legal counsel saying it was purely a colloquial usage of the word.

That seemed to be the end of it. But when Bilfinger Berger issued a statement saying the former tram chairman had “backed down” from his statements, Mandy Haeburn-Little, director of customer service and communications at Tie responded vehemently.

“David Mackay has not withdrawn any element of his statement and stands by every word that he said. At no time did David Mackay imply, make any allegations of, or introduce the subject of, criminality. The issue of criminality was introduced by Bilfinger Berger, we do not understand why."

It went on: "It was clear from David Mackay's statement what he was intending through his remarks and the use of the word 'delinquent'. David Mackay has given no assurances about future comment."

The statement ended: "The last few days have been a waste of time, a waste of public resources and a waste of effort and we will be pursuing BB to recover the costs we have incurred in defending this spurious action."

We knew things were bad. Last month's Edinburgh Trams Update Report to Council stated that “an acceptable commercial settlement now unfortunately appears unlikely in the short term.” Now we can see that was putting it mildly.

Since contractual disputes surfaced back in early 2009, only months after the tram contracts were awarded, the two sides seemed to have become more and more entrenched in their opposition. Bilfinger Berger has alleged that Tie is responsible for cost overruns and delays caused by utilities diversion and design costs. The contractor has said that both utililities and design should have been completed before the project started, and are still incomplete.

Tie maintains it is rigorously applying the terms of the contract.

While we can only speculate, it appears significant parts of the contract that were not fixed cost and/or not detailed have been the major cause of arguments and indecision between BB and Tie. It's been suggested elsewhere that due to the unpredictable nature of the trams project and the scope of the contract, the true cost of the contractor's job could be more like double the original “fixed” fee. But who knows...?

One thing is sure: with negotiations deadlocked, the city is in limbo, with many questions continuning to hang over the project.

The original route between Edinburgh Airport and Newhaven was budgeted at £545m when contracts were awarded in May 2008. The line was supposed to be completed next year, with trams running by the summer of 2011.

What now? Will the curtailed tramline, from Edinburgh Airport to St Andrew Square be feasible or will the tram stop at Haymarket?

When will this first stage be completed - 2013? 2014?

How much will it cost now to complete the Airport to St Andrew Square part of the route – £600million? £700 million? More?

When will the route on to Leith be completed?

And who is going to complete the work?

In spite having wound down much of its operation due to the dispute over pay, Bilfinger Berger is still working on parts of the trams project, such as the Gogar depot and the line out to the airport. It's difficult to see how relations between tie and the contractor could be mended but Bilfinger Berger have suggested that incoming new management could help.

“We're construction engineers and we've come to build this thing, we haven't come to fight,” insists Walker.

Given the acrimony with Tie, Walker says he's offered to explain himself directly to key members of Edinburgh City Council in an open analysis of the current situation. He believes such an open discussion could go deeper than a forthcoming investigation by spending watchdog Audit Scotland (due to report early January 2011) into the trams project.

The offer hasn't been taken up. Perhaps if Tie is looking to break its contract, it wont have time for such a hearing?

But it does beg another question: if it's not at fault, why does Tie seem to fear clarity and openness for this publicly funded project?