Council & Lothian Buses sign operating agreement

Councillors from the City of Edinburgh Council have agreed the agreement to operate the
Edinburgh Tram system with Lothian Buses as another piece of the jigsaw comes into place ahead of opening next year. As part of the agreement it has been revealed that the line may need a subsidy in the first few years before passenger numbers “pick up” sufficiently to cover costs – and it is this which the local newspaper and well know tram critics have picked up on.

At this stage it has not been revealed just how much subsidy the Council will give towards the trams but a figure of “up to £3.2 million” has been quoted in the Edinburgh Evening News although the Council have denied it will be this high. The amount will most likely come from the dividend the Council receive on an annual basis from Lothian Buses as a
major shareholder, so in effect the money will be given to by Lothian Buses to the Council to give back to Lothian Buses! In recent years this amount has varied from £2 million to £3.2 million and the Council have stated they do not intend to put all of this money to the trams. Currently this dividend is used on a variety of projects in the City including, but not exclusively, transport.

The operating agreement has also revealed that Lothian Buses will pay £2.7 million per annum for the leasing of the trams but costs for the refurbishment of the vehicles and any losses incurred will be met by the Council.

Lesley Hinds, Transport Convener on the Council, said: “We anticipate tram passenger numbers will increase after the first two years as is often the case when new transport schemes are introduced. The council, as a major shareholder, receives an annual dividend from Lothian Buses and part of this will be available to support the trams in the first few years of operation.”

But the news was not met with complete joy with staunch critic of the tram project, John Carson, having his say: “This is simply another unexpected and unacceptable debt to the city, with up to £16m poured down the black hole instead of spent on front-line services. This is money out of the project budget, which would usually go to education, social care – statutory services.”

This entry was posted in Edinburgh Trams. Bookmark the permalink.

1 Response to Council & Lothian Buses sign operating agreement

  1. The John Carson bloke, will be eating his words before long. Though there has most definately been an incredible waste of money with the arguments about constructing the tramway, examples such as Manchester, Nottingham and Sheffield and their extensions clearly show that trams are, in the long run and with an avoidance of narrow minded short sightedness, the best transport mode for medium distance journeys in towns and cities across the UK. They will benefit the community by minimising operational costs (one tram replacing up to four double decker buses) and get more people to where they want to be.

Comments are closed.