COUNCILLORS in Edinburgh yesterday voted in principle for a £162 million extension of the city’s tramline from the city centre to Newhaven on the Forth, but will have at least two more chances to abandon the project.

The business case for the extension admitted that it starts with a major funding gap of around £25 million. It was the plan to use an “extraordinary dividend” from Lothian Buses, the council-owned public transport company, to meet this gap that came under fire. Bus drivers – who are almost unanimously opposed to the plan – booed and heckled from the public gallery.

The council will consider the business case again on December 10, when final approval is expected to be given for the extension project to proceed in stages.

Once the first stage is complete, a report would be brought back to the council recommending the way forward. If councillors agree to continue with the extension, a second stage, scheduled to take 21 months and costing approximately £8.3m, would include further site investigation and other works.

The ruling Labour-SNP Capital Coalition had been made aware of the objections from trade union Unite at Lothian Buses. It voted to write to Lothian Buses, requesting details of any impacts the extraordinary dividend would make on such items as fleet modernisation plans and the likelihood of future fare increases.

The Conservative Group made its opposition to the extension clear, saying “a forecast deficit of £141m and the recent departure of the former chief executive and a number of senior directors, as well as further planned reorganisation, all raise concern over the capacity of the council to deliver a project of this scale.”

Opening the debate, council leader Andrew Burns admitted that the city’s reputation had suffered from the trams fiasco, but said that “many, many lessons have already been learned about what went wrong with the project in its early stages.”

Saying that the council was “damned if we do and damned if we don’t,” he added: “It is incumbent on all of us to focus on the longer term.”

Cllr Burns said that 100 people a week were moving in to Edinburgh and now 90,000 people a week were using the trams and 10,000 more people a week were using Lothian Buses.

He said he understood concerns about the impact on the bus company and that he was a “huge fan” of Lothian Buses – a statement that was met with boos from the public gallery.

Seconding the motion, SNP group leader Cllr Sandy Howat said he supported the extension to Newhaven, but said there were a series of questions that he would like to have answered before proceeding.

He added: “We must be sure of the arguments for and against, we must be sure of the business case and the financial model, we must be sure of the level of risk both to the tram itself and the wider council services.”

The Conservative opponents of the extension lined up to vilify the project.

Cllr Iain Whyte condemned the decision being made before the findings of Lord Hardie’s public inquiry into the massive overspending on the first tram line.

Cllr Whyte added: “People are still angry and they feel ripped off. They want to see us look after the city in a way that gets us a good deal.”

Cllr Nick Cook said: “No amount of kind and fluffy words from the leader and deputy leader can mask the deep public unpopularity that these proposals would expose to the council.

“Someone must argue for sanity on behalf of hard-working taxpayers… it appears that only the Conservatives are prepared to do that.”

Tory group leader Cllr Cameron Rose said: “It’s not viable, it’s much too expensive and it’s going to take far too long.”

The vote was 44-11 vote in favour of the extension proceeding, subject to next month’s examination of the business case.

Cllr Burns said: “I am pleased we have been able to find a way forward for the project, which would deliver a range of key benefits in terms of economic growth, greater accessibility and the environment for Leith and the city as a whole. It is now our intention to ensure complete clarity before taking the next step, taking into account the needs of the city’s taxpayers.”