Edinburgh trams: A case study of a complex project

The Edinburgh Tram project has proved to be politically contentious, complex, and problematical since preparatory work on services diversion commenced in 2007. The proposed network has been reduced to a single 18.5 km line linking Newhaven to Edinburgh Airport via Leith, Princes Street, Haymarket, Edinburgh Park and the Gyle. The main contract was let on a fixed price design and build basis to a consortium of Bilfinger Berger (civil engineering) works, Siemens (electrical) and CAF (tramcars). Work commenced in summer 2008. An earlier contract for the preparatory works and services diversions was carried out by Carillion. It appears likely that the project will not be completed before 2012 rather than the original target of 2011 and the budget cost of £545 million as included in the final business case appears likely to be exceeded. The early stages of the project's life have been blighted by political disputes between the Scottish National Party on one side, who have opposed the project and the other political parties including Labour, Liberal Democrats, Conservatives and Green Party on the other who have generally backed the scheme. The SNP currently form a minority administration in the Scottish Government at Holyrood and are part of the ruling coalition with the Liberal Democrats on City of Edinburgh Council who are the sponsors of the project. Since the opposition parties at Holyrood forced the finance for the project through there have been a number of high profile contractual disputes between the arms' length project company, Transport Initiatives Edinburgh and Bilfinger Berger. The resolution of these disputes has caused several delays to key operations for the project. This paper will analyse implications of the political disputes and way that the project was let on the progress and cost of the project.