More money demanded for tramline

The cost of the already over-budget tram project is rising once again as land developers demand more payment for the land they are giving up.

After the Edinburgh City Council forced through compulsory purchase orders for land along the route of the tram line, seven developers appealed to the Scottish Government about the land reserved for tramline use.

One of Scotland’s largest land developers, Cala, is the most advanced in legal proceedings. They are currently awaiting an imminent decision from the Scottish Government's directorate for planning and environmental appeals.

A Cala spokesman said: "Cala regards that the land use should reflect its potential as a residential site given that the land is positioned between two existing residential sites.

“Due to non-determination by the council, we had no option but to appeal."

The land was originally assigned for residential development but the council used compulsory purchase powers to change its classification to industrial land. The developer claims that the land was more profitable as residential land and is wanting to be recompensed for the loss.

The court cases may result in the original purchase order price to rise, adding millions to the council's already stretched budget.

The project has faced many problems including the threat of legal action from the tram contractors. Steve Cardownie, deputy leader of Edinburgh City Council, proclaimed that the developers' appeals “couldn’t have come at a worse time”.

He said: "Given the state of council finances at the moment, the last thing that we need is any additional financial burden on the public purse.”

Recently, it was revealed that Audit Scotland has been asked to write a report after claims that the finances of the project had been mismanaged. The organisation will assess the project's inflating costs, including those potentially caused by the developers appeals. The report will be released in early 2011.

Audit Scotland said: ‘‘It is expected to be an interim report which will consider the progress of the project to date, governance arrangements and the key issues which will need to be managed as the project goes forward.

"The auditors of Transport Scotland and the City of Edinburgh Council have been closely monitoring the project and its associated risks as part of their ongoing audits. This report will draw on their findings."