EDINBURGH'S flagship transport project now faces total collapse with losses estimated at #12m.

Cert (City of Edinburgh Rapid Transport) was to have provided an express busway, partly on new track, for a fast link from the city centre to the Gyle and the airport.

The #50m joint scheme, involving the city council and the private sector, was hailed as a model for the Private Finance Initiative (PFI) system for funding capital projects pioneered by the Tories, and enthusiastically adopted by Labour.

But the consortium, led by First Group, the bus company, and Balfour Beattie, pulled out in January citing changes, including new services on rival routes run by the bus firm owned by the council, which made it commercially unviable. Cert was due to be up-and-running three years ago, but was then selected as suitable as a PFI scheme and the complicated bidding process involved. Since then, an estimated #12m has been spent on the project, including #4m to move an entire factory in Gorgie which lay on the route.

Costs continued to rise and an additional #20m public sector commitment was being sought to keep it going. Recent talks to bring in one of the other consortia which originally put in a bid are believed to have failed. A report on the collapse of the project is due to be considered by the council at the end of this month.

Councillor Allan Jackson, Tory group transport spokesman, said yesterday: ''It has been a shambles involving a huge amount of money. I only hope we can salvage something.''