So we are going to have an extension to the trams after all. But then again, maybe not. In a curious decision the ruling SNP and Labour councillors that run Edinburgh City Council have decided to support the extension of our solitary tram line from York Place to Newhaven in principle – but have not actually approved building it. They are still uncertain of their own business case, and are still uncertain of how to pay for it. The SNP had said it would not support it but now says it does! What a mess so typical of past tram decisions.
There was much talk by our ruling councillors previously about getting the developers of the new St James Centre to stump up a good swathe of the cash needed. That now seems to be off the table.
We also know that the SNP, now that it’s in government, does not want to commit to spending any national cash, although Kenny McAskill’s calls for a tram line in Edinburgh were a sight to see in the heady “loads of money” days of the Scottish Parliament when it was still on The Mound.
So what does it do? How does it raise the money?
Well, it already has £5 million in dividends from the very successful Lothian Buses and it thinks it could get another £20m in a special dividend, if the bosses of Lothian Buses agree. That’s rather like the councillors asking themselves, because the Edinburgh City Council owns Lothian Buses, after all. The bus company’s directors could kick up a stooshie and object, but do they have the bottle to do that? Surely the council can get its way?
Then there’s the plan to raise additional income from an increase in fares on not just trams (which would of course never raise enough) but from bus passengers too. So there we have it, the whole of Edinburgh – or at least the whole of Edinburgh that uses our buses – will help pay for the tram line extension.
I wrote about the trams back in June when it started to come back on to the political agenda and put what I thought was a balanced case for both a Yes and No to the extension. The trams were a dreadful mistake and should never have been started. They were not necessary. There were so many more things that could have been done in Edinburgh with less investment – and the tram line also went to the wrong places.
But we are where we are and to make the trams sensible and generate the sort of long-term returns both financially and socially for Edinburgh that makes the existing line viable it makes sense to consider extending the line to areas where future commuting needs will exist. Remember, Edinburgh is a fast-growing city, it will by 2030 be larger than Glasgow and the traffic is bad enough. Nobody wants more roads (although there’s a case for widening some and managing others better). To go ahead with any tram extension would need, I argued, a “robust” business case – which we do not yet have.
We also had to ask is the proposed investment the best use of such money? No comparative analysis has been produced – which is not surprising given the councillors have thus far failed to provide a robust business plan.
I also suggested we should ask the question about funding instead the development of the existing South Suburban rail line – would that be a better alternative? I have an open mind but it might make sense.
These are what any sensible and objective decision would involve – but that’s not what we’ve got yet.
More worrying is how the cost has already been increased from £144.7m in the summer to £162.2m only a few months later. Wow! Here we go again! Has our council learnt nothing from the previous trams debacle?
The jump in cost is due to a further £2.5m through inflation and an extra £15m for contingency, even though there is already a 17 per cent construction contingency included. I think these contingencies say everything about the confidence – or lack of it – that the councillors have in their own estimates.
As the Tory finance spokesman Iain Whyte pointed out, with a planned delivery of six years for only 4.7 kilometres of track (for which much of the work has already been done) at such a rate of construction inflation the cost must explode exponentially! If it went up £2.5m every four months that would be an additional £7.5m a year and £45m by the finish. That’s before any rise in interest rates – which must happen eventually.
Only the Scottish Tories voted against the tram extension, losing 44-11 as SNP, Labour, Lib Dems and Greens all voted in favour.
Here’s a better plan – let the public decide. If it is going to mean a hike in bus and tram fares – and that’s what’s being proposed – the councillors should put the business case (when it is eventually ready) to a plebiscite.
After all, the Edinburgh public own the buses and trams. What have the councillors got to lose?