Under the terms of a contract signed at the start of the crisis-hit project, work to relocate gas, electricity and water mains underneath the city was to be “fully” completed before track-laying commenced, according
to German construction giant Bilfinger Berger.
It emerged yesterday that the utility diversions, which were due to be completed by the end of 2008, are now expected to continue until September 2010.
The delays are at the heart of a bitter dispute between Transport Initiatives Edinburgh (Tie), the council-owned company overseeing the project, and the BSC consortium of companies comprising Bilfinger, Siemens and CAF that has seen track-laying work on streets put on hold for more than six months.
In a letter to City of Edinburgh Council earlier this month, and leaked to The Herald, Bilfinger’s UK managing director, Richard Walker, accuses Tie of a “continual failure to deliver” utility diversions on time.
He claimed this had led to changes in the work programme that lay outwith the scope of the original contract, despite clams by Tie that it had signed a “lump sum, fully fixed price contract” to build the tram system.
“Having accepted the cost increases associated with the delays and changes, Tie must either make provision to have sufficient funds available, or review the project scope,” Mr Walker wrote.
The latest revelation raises questions over claims that Tie will seek to impose a fine of £1 million on the consortium for every month past a new deadline of June 2012 that completion of the project is delayed.
It is thought likely that this would be challenged by Bilfinger as the firm does not believe it has breached its obligations.
In a series of update reports to the council ahead of meeting of the Tram Sub Committee next Monday, Tie admitted further problems with the project:
There is now a “strong prob-ability” that the project will exceed its budget of £545m.
Track-laying on Princes Street that was supposed to be completed last year is now being revisisted to correct defects.
The cost of settling up with Carillion, which was replaced as the contractor undertaking utility diversions last November, has still not been agreed.
Delays in “infrastructure availability” could lead to increase in payments to CAF, which is building the 27 trams that will operate on the route.
