Multi-million pound compensation claims are jeopardising a scheme that could have saved hundreds from being flooded out of their homes.

Moray Council is committed to investing in a £83m flood prevention scheme for Elgin, which could have protected against the flood waters of the River Lossie that brought so much misery to the county town last week.

However, the council will simply not have the money if it has to pay up to £16m in claims from a landowner and a distillery in respect of another scheme.

Two major compensation claims are currently starting their journey through the Lands Tribunal of Scotland, which will decide the fair level of compensation for the already completed Forres flood alleviation scheme, along the A96, which allowed the Mosset Burn and River Findhorn to peak last week without flooding houses.

A spokesman for the tribunal confirmed that the claims were in the names of the Trustees of Sir Alistair Gordon Cumming and Speyside Whisky Distillers in respect of the Benromach Distillery. He said they were at the preliminary stages and it could be several months before a hearing would be held.

Sir Alistair Gordon Cumming is chief of the Clan Cumming and owner of the 12,000-acre Altyre Estate near Forres. His compensation claims relate to farm land that could be flooded by the Forres scheme to keep the water away from houses.

The distillers’ central claim relates to the likely contamination of the Benromach Distillery’s water supply by flood waters kept away from houses. Last November it emerged that the distillers had told the council that over a 100-year period the financial loss would be £184m at 2007 prices.

Company sources say that the final claim is unlikely to reach double figures of millions, but Michael Urquhart, joint managing director of Gordon and MacPhail, which owns Speyside Whisky Distillers, would only say: “We have been keen to try and resolve the compensation issue but could reach no agreement with Moray Council so have submitted a claim to the Lands Tribunal.

“The way the legislation works is unusual in that any compensation claims must be made now, in anticipation of any future contamination. It seems strange, but we have to work within the law.

“Whilst we cannot go into detail on any of the figures included within the claim, they are significantly lower than the figures previously mentioned, which were never intended to be the basis of our final claim.”

Meanwhile, it is understood that the estate is seeking in the region of £6m,

Although Environment Minister Roseanna Cunningham reassured the people of Elgin this week that Scottish Government money would be available for the flood prevention scheme, the council would still have to pay 20%, or £16.6m. About £13m of that may be needed to settle claims from Forres.

That is without any excessive compensation claims that may yet be demanded by the objectors to the Elgin proposal.

A Moray Council spokesman said: “We would not be able to confirm or deny those figures as the meeting where compensation claims were discussed was in private.

“The council has set aside £2.5m to settle compensation claims for the Forres scheme, as part of the overall £21m budget. Any claims settled that cause that figure to rise will have to be met from reserves, and will impact on future capital projects, such as Elgin [flood prevention scheme].”

Sun comes out at long last

Chris Watt

First it rained, then it poured, but now Scotland is finally being treated to some sunshine.

Temperatures are set to reach 20C today in parts of the central belt, with a hot, dry day predicted for both Glasgow and Edinburgh.

It will be unseasonably warm around the country, the Met Office said, and the mercury is expected to rise well above the 10.6C average for this time of year.

The normal maximum temperature for Scotland in September is 13.9C, according to data from the period 1971-2001, but most southern areas are expected to exceed that today.

Met Office spokeswoman Sarah Holland said that although it was too early in the year to describe the mini-heatwave as an Indian Summer, the outlook was very good for next week.

“An area of high pressure over the UK is bringing really nice warm, dry weather, in marked contrast to what Scotland has seen over the last week or so,” she said. “On the west coast it will be a bit of a foggy start to Saturday, but then it will go on to be a nice day.

“There will be some clouds around in northern parts, but temperatures are going to get up to about 18C in Glasgow. Over on the eastern side, in Tayside and Fife, it could get to about 20C.”