Edinburgh's tram system is established as a paradigm for any bungled project whose costs spiral when work is halted.
Edinburgh's tram system is established as a paradigm for any bungled project whose costs spiral when work is halted.
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Just as it appeared progress was at last being made, we are provided with a jolting reminder of the unconscionable approach to public money on the part of the directors of Tie, the organisation set up by the council to deliver the project.
It was disbanded last year in a last-ditch bid to move on from the expensive dispute with the project's main contractors. It has now been revealed that the seven directors of Tie received severance payments totalling £406,635. The highest compensation payment was £87,000 to the director, Steven Bell, who also received a £15,000 bonus.
For taxpayers far beyond the capital, who are in despair at the cost of the fiasco, this will be the last straw. Not only has the mismanaged project disrupted business and daily life in Edinburgh beyond any reasonable timescale but, also, costs have spiralled disastrously at a time of unprecedented pressure on council budgets.
There can be no doubt that those in posts of responsibility at the top of Tie were under enormous and continuous pressure but five of the seven directors had salaries in excess of £100,000 and the lowest pay-off was just over £30,000.
Publication of these severance payments will inevitably provoke an outcry that they amount to a reward for failure. The former Tie directors will now come under renewed pressure to forego the compensation payments. That is a matter for their individual consciences.
The positive aspect of this should not be ignored. The council has made the information public after initially refusing to do so. This is a significant step forward, taken on the day the UK Government's proposals for a new regime of corporate governance were published. These call for more transparency on salary and benefits for company directors, including "golden goodbye" pay-offs. Edinburgh City Council's decision has shown the public sector can lead the way. That is as it should be. While shareholders are claiming the right to know how company directors are rewarding themselves compared with the dividends they pay investors, public bodies, especially councils, must never forget that they are even more accountable to every citizen who has no option but to invest via their tax payments. Transparency should have been the model from day one of this blighted journey.
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A welcome nod in the direction of transparency
Edinburgh's tram system is established as a paradigm for any bungled project whose costs spiral when work is halted.
Just as it appeared progress was at last being made, we are provided with a jolting reminder of the unconscionable approach to public money on the part of the directors of Tie, the organisation set up by the council to deliver the project.
It was disbanded last year in a last-ditch bid to move on from the expensive dispute with the project's main contractors. It has now been revealed that the seven directors of Tie received severance payments totalling £406,635. The highest compensation payment was £87,000 to the director, Steven Bell, who also received a £15,000 bonus.
For taxpayers far beyond the capital, who are in despair at the cost of the fiasco, this will be the last straw. Not only has the mismanaged project disrupted business and daily life in Edinburgh beyond any reasonable timescale but, also, costs have spiralled disastrously at a time of unprecedented pressure on council budgets.
There can be no doubt that those in posts of responsibility at the top of Tie were under enormous and continuous pressure but five of the seven directors had salaries in excess of £100,000 and the lowest pay-off was just over £30,000.
Publication of these severance payments will inevitably provoke an outcry that they amount to a reward for failure. The former Tie directors will now come under renewed pressure to forego the compensation payments. That is a matter for their individual consciences.
The positive aspect of this should not be ignored. The council has made the information public after initially refusing to do so. This is a significant step forward, taken on the day the UK Government's proposals for a new regime of corporate governance were published. These call for more transparency on salary and benefits for company directors, including "golden goodbye" pay-offs. Edinburgh City Council's decision has shown the public sector can lead the way. That is as it should be. While shareholders are claiming the right to know how company directors are rewarding themselves compared with the dividends they pay investors, public bodies, especially councils, must never forget that they are even more accountable to every citizen who has no option but to invest via their tax payments. Transparency should have been the model from day one of this blighted journey.
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Moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours. Please be patient if your posts are not approved instantly.
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