LONGSTANDING plans to revive a commuter ferry between Fife and Edinburgh have collapsed amid new proposals to divert the six-figure European funding into a tourist service between North Berwick and Anstruther.

Two years after Edinburgh City Council put the £500,000 project in doubt by refusing transport giant Stagecoach planning permission to upgrade a terminal at Portobello on the city's east coast, councillors were blind-sided on Friday by the discovery that East Lothian Council is investing in a plan that would effectively poach the funding by running a service from North Berwick instead.

Boating tours company Maid of the Forth, with backing from the South East of Scotland Transport Partnership (SEStran), which was involved with the Stagecoach project, is aiming to seduce tourists and residents on both sides of the Forth with attractions that take hours to reach by car.

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Those on the North Berwick side can look forward to the charms of the East Neuk of Fife and golfing trips to St Andrews, while those in Fife will be tempted with the North Berwick Seabird Centre and the Bass Rock.

The 57-passenger boat would cover the 10-mile stretch with twice-daily trips that would take half an hour.

The scheme is a far cry from Brian Souter's original plan for a Portobello-Kirkcaldy hovercraft. When the city turned him down over concerns about noise and the design of the ramp, it urged him to instead consider running a route between Granton on its north coast and Burntisland in Fife. This route that had been recommended as the most commercially viable in a study by Hyder Consulting a few years earlier, even though a previous attempt to run a commercial service in the 1990s collapsed after a year.

Stagecoach commissioned specialists to scope the route, but last year decided it was not workable. This prompted SEStran to look for new partners

According to project manager Ian Mathie, it made several attempts to contact Pentland Ferries, an Orkney-based company which had also announced last year that it was interested in running a route over the Forth.

He claims to have not received a reply. It instead began talking to Maid of the Forth, which operates out of South Queensferry and North Berwick, providing tours to places like the Bass Rock, the Isle of May and Inchcolm.

The company, which was already planning to buy a circa £400,000 boat to extend its Bass Rock service, saw running to Anstruther as a way of getting European assistance.

It intends to start running to the Fife fishing village only at weekends and still use the boat to run to the Bass Rock on other days.

The plan has become fully viable after East Lothian Council agreed to come onboard a few weeks ago.

It has agreed to invest a "substantial" sum to improve an outlying pier that would be necessary for the service.

The consortium has applied for permission from the North Sea Secretariat of the European Regional Development Fund to switch the £250,000 funding and expects to receive a positive response before the end of this month. It hopes to start running the ferry later this year.

Lesley Hinds, convener of the Edinburgh City Council transport committee and a board member of SEStran, said she had not heard about the plan and would look into it.

She said: "If this is for tourism, you have to question how this funding can be transferred over in this way when it was supposed to be coming from Europe to help Edinburgh and Fife invest in public transport."

Hinds's Labour administration was not in power when the decision was taken to reject the Portobello project.

A source familiar with the new project countered that the European money was intended to help communities in remote locations, and questioned whether that could be applied to Portobello, Granton, Burntisland or Kirkcaldy.

Andrew Banks, head of Pentland Ferries, said: "Initially it looked quite good, but we couldn't find suitable second-hand boats. We needed new boats and then the figures didn't stack up. We talked to SEStran, but they said there was no funding available."

Banks did not return calls to respond to suggestions that SEStran had previously tried unsuccessfully to contact him.

Colin Aston, head of Maid of the Forth, said the project was a "work in progress" and was not ready to be discussed publicly.