1 Friday, 6 October 2017 9 MR MACKENZIE: The next witness is Trudi Craggs. 10 MS TRUDI CRAGGS (affirmed) 11 CHAIR OF THE INQUIRY: Ms Craggs, if I could ask you to 12 listen to the question and answer it as concisely as 13 possible, and then to add any explanation that you feel 14 necessary. 15 Could you speak clearly into the microphone so 16 everyone can hear, and also relatively slowly so the 17 shorthand writers can keep up with you. 18 Examination by MR MACKENZIE 19 MR MACKENZIE: Good afternoon. 20 A. Good afternoon. 21 Q. Can you state your full name, please? 22 A. Trudi Craggs. 23 Q. And your current occupation? 24 A. I'm a self-employed reporter for the Scottish Government 25 and I'm on various boards. 93 1 Q. Can we look, please, at the CV you have provided. It's 2 CVS00000076. We can see towards the bottom of the box 3 section, you qualified as a solicitor in 1998. We can 4 see you were then an associate with Dundas & Wilson 5 between September 2002 and August 2005. Between 6 September 2005 and April 2007 was the period we're 7 interested in, you were a senior associate at Dundas & 8 Wilson. In the box up we can see that between 9 March 2006 and April 2007, you were seconded to tie Ltd 10 as the Director of Approvals and Consents; is that 11 correct? 12 A. That's correct, yes. 13 Q. We can read for ourselves that you then became a partner 14 in Dundas & Wilson, and in due course CMS Cameron 15 McKenna. 16 At the top of the page then we can see, as you 17 mentioned, sitting on various boards and also as 18 a self-employed reporter for the Government's Department 19 of Planning and Environmental Appeals Division. 20 Thank you. 21 We can put that CV to one side. 22 I think you have previously provided a written 23 statement to the Inquiry. I think there may be a hard 24 copy in front of you. 25 A. I have it. 94 1 Q. We can also bring it up on screen. The document is 2 TRI00000029. I should formally go to the last page, 3 page 113, please. We can see a signature dated 4 31 May 2017. Can you confirm, please, that that is your 5 signature and this is the written statement you provided 6 to the Inquiry? 7 A. Yes, that's my signature. It is my written statement 8 for the Inquiry. 9 Q. Thank you. Your evidence to the Inquiry will comprise 10 both your written statement and the evidence you give 11 today. 12 Now, if we can go back to page 1 of the statement, 13 please, to look at your role at tie. In the 14 introductory paragraph at the beginning you explain that 15 you started advising tie and the Council on the tram 16 project in about the middle of 2004. Your initial role 17 was to manage the parliamentary process, et cetera. You 18 did that for two years until both Bills got Royal 19 Assent, which I think was about May 2006? 20 A. I think the final stage debates of Parliament were, yes, 21 March 2006. I think the Royal Assent was end of April, 22 beginning of May for both Bills. 23 Q. Thank you. You then say: 24 "I was seconded to tie on a full-time basis from 25 March 2006 until about March/April 2007, when I think 95 1 I stopped working in the tie office on a daily basis. 2 I did, however, continue to have considerable 3 involvement in the project until around March 2008, 4 although after that my involvement became more ad hoc. 5 My job title on secondment was Director of Design, 6 Consents and Approvals." 7 Then go to page 2 of your statement to see your 8 duties and responsibilities in that role. In 9 paragraph 2, you explain your key role on secondment at 10 tie was to make sure that the commitments and 11 undertakings that came out of parliamentary process were 12 properly captured and fed into the procurement process: 13 "That morphed, when Andie Harper came in as Project 14 Director ..." 15 That was approximately May 2006, when he came in: 16 "... into the role of Director of Design, Consents 17 and Approvals." 18 Just to pause there, it may be thought that a lawyer 19 may not be best placed to fulfil that role rather than 20 a designer or engineer. Do you have any comment on that 21 suggestion? 22 A. I can see the argument that it's maybe not the best 23 person to fulfil that role. But I think my knowledge of 24 the project overall, my knowledge of the consents 25 processes in relation to getting planning permission, 96 1 draft regulation orders, consents from the airport, my 2 knowledge of the land acquisition process, I think, all 3 that then augmented the team we had, and below me there 4 were engineers, there were designers, and so having that 5 global knowledge of the entire team, I think this is 6 where Andie was trying to get a team that could do all 7 aspects of it. 8 I wasn't holding myself out to be a designer or an 9 engineer. But I think my knowledge, my project 10 management skills, were supplementing what tie designers 11 already had on their team. 12 CHAIR OF THE INQUIRY: Could you slow down, because the 13 shorthand writers have difficulty in keeping up. 14 A. Sorry. 15 MR MACKENZIE: Could you also please speak into the 16 microphone for my benefit as well, please. 17 A. Do you want me to say anything more on that? 18 Q. I'll just check if the shorthand writer has captured all 19 of that. 20 I think I should start again. In short I have 21 suggested it may be thought that a lawyer may not be the 22 best person to be the Director of Design, Consents and 23 Approvals rather than, for example, a designer or 24 engineer? 25 A. Okay. I'll give the answer again. 97 1 I can accept the argument that a lawyer was perhaps 2 not best placed to take on that role. But I think 3 I have to look at it in the context of what the role 4 was. It was a wider role than just managing a design 5 team. It was a wider role than approving engineering 6 drawings. Really it was looking at the whole process of 7 the various elements of consents, approvals that had to 8 be obtained in addition to the Parliamentary Acts. 9 So, for example, there was the planning approval 10 process, the draft regulation order process, the land 11 acquisition process, getting licences from third 12 parties, getting other consents from third parties in 13 terms of the side agreements entered into through the 14 parliamentary process. But it was also not managing the 15 design team, but almost co-ordinating the inputs to help 16 the design, and below me there were engineers, there was 17 the SDS design team. 18 So I think if you take the whole team, and all the 19 expertise in that team, actually I probably supplemented 20 that and brought my project management skills and my 21 wide-ranging legal knowledge. 22 Q. Thank you. Back to your statement, please, in 23 paragraph 4. You explain your role did not involve 24 actually managing SDS. That was for SDS to do: 25 "Nor did I manage the SDS contract." 98 1 I'll come back to that shortly. Just sticking then 2 with your statement, please, at page 4, in paragraph 8 3 you explain that you reported to whoever was the Tram 4 Project Director. I think Mr Harper was the Tram 5 Project Director from May 2006 to September 2006; does 6 that seem right? 7 A. That's right. The first Project Director was 8 Ian Kendall that I worked to. Then it was Andie Harper. 9 Then it was Matthew Crosse. I think latterly it was 10 Steven Bell. 11 Q. Thank you. You also say in paragraph 8, about halfway 12 down: 13 "Ailsa McGregor came in as the SDS Project Manager 14 in about the Summer of 2006. No one had done that role 15 prior to her arrival. It was not anticipated that SDS 16 would require to be managed in the way that it was 17 eventually was. I think it was anticipated that SDS 18 contract management would be minimal." 19 Now, you say no one had done that role prior to 20 Ms McGregor's arrival. What did Ms McGregor's role 21 involve? So when Ms McGregor came in as SDS Project 22 Manager, what were her duties and responsibilities 23 generally? 24 A. Generally she was managing the interface between tie and 25 SDS at a contractual level, not an everyday output 99 1 level, but contractually she was managing the outputs. 2 So she would monitor the outputs against the programme. 3 If there were contractual concerns from SDS, she would 4 respond to that. Any issues between the two parties 5 again contractually, she would deal with those kind of 6 issues. 7 Q. Thank you. Now, you had said that -- you said: 8 "I think it was anticipated that SDS contract 9 management would be minimal." 10 Do you know why that was? 11 A. I think given the nature of the contract, it was 12 anticipated that tie would enter into the contract. SDS 13 would design a tram. tie would get the design. And we 14 would then deliver a contract, and the tram would be 15 constructed. I don't think people had anticipated or 16 had the experience of managing this type of contract, 17 and anticipated the level of management it may require 18 to ensure that the parties were fulfilling their 19 obligations. 20 I also think the contract from memory was such that 21 the risk and the obligations were all passed to SDS, 22 with tie and the Council -- the Council were fairly 23 silent in the contract, but tie having a very minimal 24 role and just expecting outputs to be delivered in 25 accordance with the programme, had the contract worked 100 1 as it was meant to. 2 Q. Thank you. We will come back to some of these 3 provisions, I think, in the contract if we have time. 4 Could you go to one, please. So the doc ID 5 reference is CEC00839054. It's at page 39. We can see 6 at the very bottom, clause 10, management of the 7 services. We can see 10.1: 8 "The Client's Representative shall ..." 9 Over the page, very top: 10 " be responsible for the day to day supervision 11 of the Services to be performed by the SDS Provider." 12 Do you know, Ms Craggs, who was tie's client 13 representative under this clause prior to your 14 involvement with the tram project as Director of Design, 15 Consents, et cetera? So prior to your secondment, did 16 you know who was tie's client representative? 17 A. I don't know. I assume it might have been the Project 18 Director, but I don't know for sure. 19 Q. Who was the client representative during your secondment 20 to the tram project? 21 A. I think at that point -- I think Andie Harper might have 22 been the client representative to start with, and then 23 I think Ailsa was given that responsibility. 24 Q. Were you ever the client representative under the 25 contract? 101 1 A. No. 2 Q. Do you know whether during your period of secondment, 3 there was day-to-day supervision by the client 4 representative of the services provided by the SDS 5 provider? 6 A. It's difficult to say what's meant by supervision. 7 There wasn't a supervision in that the designers 8 reported on a daily basis -- basis to a person in tie, 9 reporting on their progress, because they did have 10 someone at SDS at senior level who took on that role of 11 co-ordinating the design teams. 12 If it was meaning day-to-day contact, liaison 13 between SDS and tie, then there was people in tie who 14 did have day-to-day contact, but I think it's difficult 15 to say that there was day-to-day supervision. 16 I'm just not quite sure what that contract intended 17 by use of those words. 18 Q. Thank you. Perhaps related matter. Coming back to your 19 statement, please, at page 5 in paragraph 11. You say 20 in paragraph 11: 21 "The role of Director of Design, Consents and 22 Approvals did not exist before I joined tie. 23 Andie Harper created the structure." 24 Do you know who within tie was responsible for these 25 matters before your appointment? 102 1 A. Possibly no one, because the risk of getting the 2 consents and approvals had been passed from tie's point 3 of view to SDS. 4 Q. Thank you. 5 A. I should probably add also that until you have the two 6 Acts of Parliament, you probably don't focus much on the 7 additional consents you require, because there's no need 8 to, until you know you have actually got your main 9 consent which was your Act. 10 Q. Thank you. Then in paragraph 12, on the same page, 11 there's reference to the DPD sub-committee. I should 12 pause and ask, I think you attended this committee 13 certainly for a period; is that correct? 14 A. I did, yes. 15 Q. Were you aware this sub-committee was a sub-committee of 16 the Tram Project Board? 17 A. Yes, I was. 18 Q. You also say that, towards the bottom of the page: 19 "Also, I had chosen not to attend many of these 20 meetings because I did not feel that we were reporting 21 accurately." 22 We will come back to that later on in your 23 statement. 24 Also on page 6, just to finish this overview, in 25 paragraph 13 you explain that you think you worked in 103 1 the tie office every day at the start of your 2 secondment, but you spent less time there from about 3 March/April 2007 when you think you stopped working in 4 the tie office on a daily basis. It coincided with you 5 being made a partner at D&W from 1 May 2007: 6 "… but I was also doing less for tie because the 7 relationship was getting uncomfortable. I was 8 uncomfortable with the way things were going and I had 9 made my views known. I think there was a feeling that 10 I was not helping the project. I was not being invited 11 to meetings ..." 12 We will come back to that. That's just to provide 13 some context, I think, for your lesser involvement after 14 about March/April 2007. 15 Now, move on to the question of the procurement 16 strategy, please. We'd asked you various questions 17 about that. If we can go to page 8, please, of your 18 statement, in paragraphs 19 and 20, paragraph 19 you 19 say: 20 "I think in principle at that point in time 21 (December 2005) the procurement strategy was quite 22 sound. The difficulty arose in implementing it once we 23 started hitting delays. In my view, there was not 24 enough thought put into evolving the strategy or 25 re-programming to take account of the delays which 104 1 undermined the strategy." 2 In paragraph 20: 3 "Had there been someone brave enough to delay the 4 procurement to allow design to catch up, the strategy 5 probably could have been kept whole and been executed 6 more effectively." 7 Now, to pause there, why was procurement not delayed 8 to allow delay to catch up? 9 A. I don't know for sure why it wasn't delayed. What I can 10 guess, and with hindsight, that there was some impetus 11 to reach -- achieve the milestone for entering into the 12 contracts and having a tram running. 13 Therefore, that date was not allowed to be moved, 14 allowed to be delayed. Whether that was a political 15 imperative or -- I don't know, to be honest, why that 16 date wasn't delayed. 17 Q. What were your views at the time as to whether 18 procurement should be delayed to allow design to catch 19 up? 20 A. I think it's well-documented in my statement that on 21 several occasions, I felt the project should be paused 22 to allow the design to catch up, to keep the procurement 23 strategy whole. And to start the procurement strategy 24 on a proper footing. 25 Q. Yes. Just by way of explanation, who did you make these 105 1 views clear to? 2 A. The first time I raised it was at the Tramco Gateway 3 Review, which was in May 2006 on the day that 4 Andie Harper started as Project Director. And I was 5 asked a question at that time what I thought the issues 6 were, and what my recommendation would be. At that 7 point I suggested the project should be delayed by 8 a month. 9 So that was said in the presence of Andie Harper and 10 the review team. 11 I think I then again said it late 12 September/October 2006, just before tie started 13 procurement of the Infraco contractor because at that 14 point, I felt the documentation that was going to go out 15 to potential tenderers wasn't fit for purpose, and 16 a design was at such a stage that it wasn't clear 17 necessarily what we were asking the tenderers to bid 18 against. 19 At that point, given where we were, and the status 20 of the preliminary design, the design review process and 21 preliminary design 2, which is all set out in my 22 statement, I thought at that point there should be 23 a three-month delay to allow the project to catch up. 24 Then before the elections in May 2007, there was 25 discussion before the purdah period about the Minister 106 1 at the time digging a hole, effectively, to move some 2 utilities; I guess to show that the project had reached 3 a point where you were into construction phase. Let's 4 call it that. 5 Again, at that point, I was concerned that by 6 triggering the construction phase of the MUDFA contract, 7 and coming out of the pre-construction phase, you are 8 entering into a different phase with different 9 obligations, that that could lead us into difficulties. 10 Again I suggested at that point, just have a picture 11 with the Minister with a spade holding an Act of 12 Parliament or a contract. It was all publicity, it's 13 all press, rather than actually dig the hole, and again 14 pause at that point, use the purdah period sensibly, 15 when you can't make political decisions, to catch up 16 quietly; and then I think was that the last time 17 I said -- I think I said again when Dave Crawley did his 18 review. I think that was in January 2007. I think he 19 came in -- I actually can't recall the session I had 20 with Dave Crawley. But I think he came in and we were 21 asked to comment on what our key issues were. 22 At that point again I suggested a hiatus in the 23 project, another pause. I don't recall if I gave a time 24 limit at that point or not, to be honest. But there was 25 at least four occasions where I made it known to key 107 1 staff and the core of the Project Director at tie that 2 the project should be paused. 3 Q. Yes. On that point, you said that the May 2006, the OGC 4 review, Andie Harper was there on day 1 of his job. You 5 also mentioned secondly in late September/October 2006, 6 just before the Infraco tendering documentation went 7 out. 8 Again, you suggested a pause. 9 Who did you make that suggestion to? 10 A. It was late one evening. I do recall this very clearly. 11 It was a meeting with tie. Andie Harper was there. 12 Geoff Gilbert was there. Susan Clark was there. 13 I imagine Alastair Richards was there from TEL. Some of 14 the design team may have been there, but I can't be 15 definite about that. But the key parties, Andie Harper, 16 Geoff Gilbert and Susan Clark, were definitely there, 17 when I made the comment. 18 Q. On that occasion you mentioned to David Crawley in 19 January 2007, and the fourth one, just before the 20 May 2007 election, you referred to the minister with 21 a spade. 22 So just before the May 2007 election, who was the 23 suggestion made to at that stage? 24 A. It was Matthew Crosse and Susan Clark. 25 Q. What response did you get back on each of these 108 1 occasions to your suggestion? 2 A. At the Tramco Review in May 2006, there was no real 3 response back to that, because it was done in the 4 context of that review. To be fair to Andie Harper, 5 he'd just that day arrived on the project, so probably 6 wasn't in a position to comment on whether that was 7 a good recommendation or not. 8 So there was no real feedback at that point. 9 At the point of time when it was before the Infraco 10 contract, I think Andie Harper may have had some 11 sympathy over the suggestion, but there was a clear 12 kickback from the rest of the team, and I know from 13 Andie Harper that we would not be pausing the project. 14 We had to go out to procurement on that day this October 15 and it was non-negotiable. 16 At the David Crawley Review, again that was 17 inputting into his report to, I think, Project Director. 18 So I had no feedback at that point. 19 Then in the March 2007 before the -- for the MUDFA 20 contract, and the digging the hole, again, I was told 21 under no circumstances would there be a delay to the 22 project or a pause. 23 Q. Told by who? 24 A. Matthew Crosse and Susan Clark. 25 CHAIR OF THE INQUIRY: Was the hole actually dug? Did the 109 1 Minister dig a hole? 2 A. There was a hole dug outside Stanley Casino, and from 3 recollection, either no utilities were found when we 4 expected some or more utilities were found than we 5 expected, which is probably another issue. But a hole 6 was dug and filled in quite quickly afterwards. 7 MR MACKENZIE: Now go back, please, to paragraph 20 in your 8 statement. It's still up on the screen. The last 9 sentence you say: 10 "However, part of the problem with that is, if 11 progress is not being reported accurately in the first 12 place, then it becomes harder and harder to make that 13 call." 14 Can you explain what you mean by that sentence, 15 please? 16 A. On the project there was -- I say monthly, but it was 17 actually four-weekly, 20-day period reporting on the 18 project, and that's railway periods. That was why it 19 was not monthly. 20 There was reporting to the DPD and then obviously 21 reports went up to the Tram Project Board. 22 If you're reporting at that frequency, that there's 23 no big issues with the project, that there's no 24 slippage, that everything seems to be on track, if you 25 suddenly out of the blue then say you are going to pause 110 1 the project, that comes as a big shock to those people 2 you've been reporting to, saying everything is on track. 3 So therefore I think it does become harder and 4 harder to be brave enough to say to your sponsors and 5 your funders: we now need to pause this project for all 6 these reasons, which we haven't told you before. 7 Q. While you were on secondment to tie, and in particular 8 when you were working on a daily basis in the office, so 9 from May 2006, was it starting -- 10 A. Yes, it was, April/May 2006. 11 Q. April/May 2006 to, was it February/March 2007? 12 A. Yes. 13 Q. About then. 14 A. About that time. 15 Q. During that period, did you have any concerns as to 16 whether design issues were being accurately reported 17 both to the DPD Sub-Committee and the Tram Project 18 Board? 19 A. What do you mean by design issues? 20 Q. Any difficulties and delays with the design. 21 A. I think sometimes there had been reported, but perhaps 22 the severity and the implications of those were maybe 23 not always being reported as clearly as they may have 24 been. 25 Q. Thank you. 111 1 Now, going back to the SDS contract, we've heard 2 various evidence about the design programme. We haven't 3 actually looked at that in the contract. So it may be 4 helpful to do that at this stage. 5 I quite appreciate that you -- the contract is dated 6 September 2005. So you weren't involved in that; is 7 that correct? 8 A. I was not involved in the negotiation or the drafting of 9 the contract at all. 10 Q. But presumably, when you were seconded to tie in this 11 role, you required to get to grips with the contract and 12 what it required of the parties? 13 A. To a certain extent. I think you've got to appreciate 14 where we were when I first went on secondment in that 15 initially I don't think there was any inkling as to how 16 bad things were going to get. And people were not 17 contractual when I first went on secondment. And 18 actually I think it's a sign of a good contract when 19 you're not looking at it on a day-to-day basis, because 20 it's actually working. If you are poring over the 21 contract and all the clauses and having to implement all 22 the clauses of the contract, I kind of feel there's 23 something far wrong with it. 24 So I first went on secondment, we weren't at that 25 stage of poring over the contract terms to try and get 112 1 resolution of points. So it wasn't until later on that 2 we started looking at different clauses of the contract. 3 But I wouldn't say with all honesty that I read it from 4 start to finish and knew it inside out and back to 5 front. 6 Q. On the question of programme, when you were seconded to 7 tie, did you understand there to be an agreed programme 8 for the delivery of design by SDS? 9 A. Yes, I did. 10 Q. What was that programme? Where was it to be found? 11 A. There was a programme attached to the contract, there 12 was a contract schedule, from memory, and then every 13 reporting period SDS provided an update to that 14 programme. 15 Q. Thank you. If we can then now look at the contract and 16 see what it says about the programme, and the reference 17 number again is CEC00839054. 18 If we can go, please, to page 30, top of the page 19 under clause 7, "Progress", we see 7.1, a reference to 20 "Master Project Programme, Programme Phasing Structure 21 and Programme". 22 We can see in clause 7.1.1 that provides: 23 "The SDS Provider shall progress the Services with 24 due expedition ... to achieve timeous completion of the 25 services ... and its other obligations under this 113 1 Agreement in accordance with the Master Project 2 Programme ..." 3 Could we then please jump to page 13, to the 4 interpretations section to see what is meant by "Master 5 Project Programme". 6 Three definitions from the bottom, we see: 7 "Master Project Programme" means project programme to 8 be prepared, maintained, updated and amended from time 9 to time by tie and notified to SDS ..." 10 I'll come back to that later. 11 If we go then to page 30, and in clause 7.1.2, 12 towards the top, it provides: 13 "Within 30 days of the Effective Date, the ..." 14 To pause, that is defined as being the date of 15 signature of the agreement: 16 "... the SDS Provider shall update the Programme 17 with detailed programme information and shall thereafter 18 maintain, update and amend the programme in accordance 19 with the requirements set out in paragraph 4 of 20 Schedule 1 (Scope of Services) ... Any updates or 21 amendments to the programme shall be approved by the 22 Client ..." 23 Pause there. On the question of the master 24 programme, are you aware whether a master programme was 25 produced by tie and sent to SDS? 114 1 A. There was a master programme with high level milestone 2 dates. I do recall that. I assume it must have been 3 sent to SDS either prior to signing the contract, around 4 signing the contract or shortly thereafter. So there 5 definitely was a master programme. 6 Q. Who within tie was responsible for producing the master 7 programme? 8 A. Tom Hickman was the planning or programming person, as 9 in who kind of pushed the buttons. Not being flippant, 10 but he kind of formatted programme, can interrogate the 11 programme, and I think Susan Clark would have been his 12 line manager in the context of that. 13 Q. Thank you. If we can just go to another document in 14 this regard, please. It's CEC02085580. It may be this 15 is a matter I have to follow up with others, but I would 16 be interested in knowing your understanding of these 17 matters, if any. 18 So what in short this is is a document produced by 19 Parsons Brinckerhoff, and it's claim for additional 20 costs, et cetera, and you see the date is May 2007. 21 If we can go, please, to page 7 of this document, at 22 the bottom of the page, under paragraph 1.9, it's headed 23 "Failure to update the Master Project Programme", and 24 what Parsons have said here is that tie is obliged to 25 issue the master project programme, which shows the 115 1 programming interfaces for all tram network contracts. 2 PB has only been issued with one version of the master 3 programme, (dated 19 February 2007), and this has 4 impacted resource planning through the resulting lack of 5 clarity on project overall requirements." 6 So in short, Ms Craggs, we see in the SDS contract 7 the reference to the Master Project Programme, but on 8 the face of it, Parsons seem to be saying here that they 9 only received one version, at least at this date, dated 10 19 February 2007. I just wonder which is correct. 11 A. I've never seen this document before, but I know when 12 I was at tie on secondment -- so that is kind of 13 April/May 2006 until April/May 2007 -- I was aware that 14 there was a project programme, a Master Project 15 Programme, and I would have thought that would have been 16 shared with SDS. 17 From the programmes that tie got back from SDS, 18 which were very detailed, four to eight pages long, 19 I had assumed they would have got the certain milestone 20 dates from information provided by tie. So the key 21 milestone dates must from come from tie, except just 22 reading what they had there on the previous page, that 23 perhaps it didn't have -- I think it was referred to as 24 the contract interfaces on the previous page of that 25 document. 116 1 Q. Yes. We can go back to the previous page if that helps, 2 at the bottom. 3 A. It says there that the Master Project Programme which 4 shows the programming interfaces for all tram network 5 contracts. It may have been the case that the Master 6 Project Programme didn't show that, I'm not sure what is 7 meant by programming interfaces. Reading the context of 8 this, and -- on the previous -- the next page, the 9 reference to the MUDFA contract, it may have been that 10 whilst the tie project programme had key milestones, it 11 didn't necessarily show, for example, the interface 12 between the SDS outputs and the MUDFA outputs and how 13 those related to allow SDS to then structure their own 14 outputs to meet those interfaces. 15 That may be a criticism. I don't know if that's 16 what they are getting at, but with hindsight and 17 recollection, that may have been where there was a gap. 18 Q. While you were on secondment with tie, who within tie 19 was responsible for issuing the Master Project Programme 20 to SDS? 21 A. I don't know. I suspect the Project Director. 22 CHAIR OF THE INQUIRY: You mentioned Susan Clark earlier. 23 Did she have something to do with this? 24 A. She would have been involved in putting the programme 25 together, and informing that process, but I think the 117 1 interface between tie and SDS would have been through 2 the Project Director rather than Susan Clark. 3 CHAIR OF THE INQUIRY: Is this a convenient time? 4 MR MACKENZIE: My Lord, I have a few questions about 5 programme which may take about five minutes. I'm happy 6 to complete that or stop now. 7 CHAIR OF THE INQUIRY: We will stop. We will have a break 8 for lunch and resume again at 2 o'clock. 9 (12.59 pm) 10 (The short adjournment) 11 (2.00 pm) 12 CHAIR OF THE INQUIRY: Good afternoon. You're still under 13 oath. 14 I should have said when you started, I apologise for 15 inconveniencing you on Tuesday, but it was something 16 beyond my control. I appreciate you've got family 17 commitments, so I appreciate you coming in today. 18 A. No problem, thank you. 19 MR MACKENZIE: Thank you, my Lord. 20 Now, sticking with the question of programme and 21 looking at the contractual provisions, I should just say 22 my only purpose in doing this is I'm trying to clarify 23 whether a programme for the production of design was 24 agreed at the time the contract was signed or, if not, 25 whether a programme was agreed later. So that's why I'm 118 1 asking these questions. 2 If we could go back, please, to the contract, the 3 reference again is CEC00839054. Go to page 30 of the 4 contract, please. Picking up where we left off before 5 lunch, we had looked at clause 7.1.1, which referred to 6 the Master Project Programme. I had then read out the 7 next clause, 7.1.2, which referred to the programme to 8 be provided and updated by the SDS provider. 9 To understand what programme means used in that 10 clause, we should then go to the interpretation section, 11 to page 15. We see the word "programme" in the middle 12 of the page means: 13 "... the programme set out in Schedule 4 (as 14 maintained, updated and amended from time to time by the 15 SDS provider in accordance with this agreement) as may 16 be extended in accordance with clause 7.5 of this 17 agreement ..." 18 Clause 7.5, I think, deals with extensions of time. 19 If we could stick with programme and look next at 20 Schedule 4 to see what's set out there, we will find 21 that at page 248. We see this page is headed "Schedule 22 four programme". If we then please go on to the next 23 page, 249, it's quite hard to see, but if we start by 24 blowing up the very top of the page to try and see the 25 title at the very top of the page, I think we can 119 1 vaguely make out that says: 2 "Edinburgh Tram Network - Line One - System Design 3 Services - Outline Design Programme". 4 If we could then please go to the very bottom line 5 in the middle, we will see a reference to page numbers. 6 The very bottom of the page, very bottom, we can see the 7 bottom row, the very bottom row, in the middle, we can 8 see it says page 2. 9 Thank you. 10 We can vaguely see page 2 there. Just to explain 11 that the copy we have been provided with, and it was the 12 best copy we can get, starts at page 2, rather than 13 page 1, but I don't think it actually matters in the 14 bigger scheme of things. 15 If we stick with the very last line, go to the 16 bottom left, if we can try and blow that up, please, and 17 see the date, it is the very last line, not the numbered 18 rows, the very bottom line, far left-hand corner. 19 Again, it's hard to see, but I think we can just see 20 that says 12/05/05. So on the face of it, the programme 21 contained in the contract dated September 2007, 22 programme appears to be dated May -- I'm sorry. 23 CHAIR OF THE INQUIRY: Is it 2005 or is it 2006? 24 MR MACKENZIE: I think it's a 05, my Lord, because, for 25 reasons we'll come on to see, the contract of course is 120 1 signed in September 2005. I think this is a reference 2 to May 2005, and if we then go up to numbered line 74 by 3 way of example, if we can find numbered line 74, it's 4 towards the top. I apologise for the copy. We have 5 tried to get a better copy. It's the best we've been 6 given. 7 So, for example, line 74 states: 8 "Constitution Street to Ocean Drive". 9 If we go further over to the right, if we -- maybe 10 we find it hard to blow it up, perhaps. Thank you. 11 So in row 474, this is to get an overview of this 12 section, Constitution Street to Ocean Drive, we see 300 13 and something days. It's perhaps 68, it may be 88 days. 14 But just to the right of that, is it possible to 15 blow it up any further? No, that's the best we can do. 16 Just to the right of the days, it's a reference 17 to -- almost, I'm afraid, illegible. My printed copy is 18 oddly enough better, and the date is 1 July 2005. It 19 may be what we can do is try and have another look at 20 producing a better copy to go into the public record. 21 Maybe we could try another one if it's more legible. 22 This is for the start date. 23 In short, if we go again to the very second top 24 line, second top row, we can see a heading in the 25 middle. So if we blow up that, please. Thank you. 121 1 We see duration, number of days, start, finish. So 2 it's that start column we are looking at. For example, 3 even there -- it's not easy to see what that says. 4 But if we could then go back to numbered row 87, 5 please, and see if this is any more legible, and try and 6 find the start date for that, we can see, I think it 7 states 1 July. So 01/07/05, and in short, when one 8 looks at this programme attached to the contract, one 9 sees a number of start dates for the various sections 10 which are July 2005, namely a number of months before 11 the signature of the contract in September 2005. 12 So in short, from looking at the programme appended 13 to the contract, it appears as though the programme was 14 out of date at the time the contract was signed; is that 15 something you had any awareness of? 16 A. I wasn't aware of that. I wasn't involved in obviously 17 the negotiation of this contract. 18 All I can think that's happened is that they've 19 added into the contract the programme that was provided 20 as part of their tender. So they've accepted the tender 21 with this programme forming part of it and they have 22 just put that into the contract with the obligation to 23 provide an updated programme from 30 days of signing. 24 Q. When you started in your role as Director of Approvals 25 and Consents in around March or April 2006, in 122 1 March 2006, did you understand there to be an agreed 2 programme in place for the production of design? 3 A. Yes, at that time there was an agreed programme that was 4 produced monthly. My understanding was there was key 5 milestone dates for when preliminary design would be 6 produced, detailed design would be produced. And every 7 month they provided a similar programme to this Gantt 8 chart, with a more detailed line by line analysis, but 9 the key milestones were agreed. I can't remember if 10 that was in the requirements definitions stage document 11 that was produced as part of their contract, which 12 formed part of the master programme as well. But my 13 understanding was the key milestones were agreed, 14 although I think there was recognition that the work to 15 get to that milestone was kind of up to SDS and that 16 they might -- some things might slip, provided they hit 17 the big milestone, individual work packages on this line 18 by line basis might move slightly, but there was those 19 agreed dates, yes, when I started as the Director. 20 Q. I understand. So your understanding was that these key 21 milestones for production of requirements definition, 22 design, preliminary design and detailed design, these 23 dates have been agreed, and then the detail -- the level 24 of detail below that was perhaps a matter for SDS. 25 A. That was my understanding. It was the key dates that 123 1 were of importance to tie. How SDS managed their 2 day-to-day workloads, I think is for SDS to manage, 3 provided you're still hitting the overall milestone of 4 producing the design. 5 Can I just add something to an answer I gave 6 earlier. It was an answer to the question that you 7 asked about: was it odd that a lawyer should take on the 8 role of Director of Design, Consents and Approvals. To 9 be fair, I was maybe slightly not expecting that 10 question, but I have thought about it a little bit over 11 lunch. 12 I just want to set the context of that role. It 13 wasn't a role because I was a lawyer. It was because 14 I had the unique knowledge of what had happened through 15 the parliamentary process. The unique knowledge of all 16 the consents and the approvals processes. The side 17 agreement with third parties with the constraints and 18 the obligations, the knowledge of the limits of 19 deviation. 20 CHAIR OF THE INQUIRY: Can we just slow down. 21 A. The knowledge of the route. All of that I think was why 22 Andie Harper created the role, not because I was 23 a lawyer, and I was probably in a very unique position. 24 I was perhaps the only person who had that knowledge, 25 that corporate knowledge, to allow what had come out of 124 1 the parliamentary process to go into the procurement 2 process. I just want to set the role in context, to 3 give a bit more explanation. 4 MR MACKENZIE: Thank you. 5 Just the last point on the question of the 6 programme. Can we then go back, please, to page 30 in 7 the contract. 8 In clause 7.2, this may be a reference to what you 9 mentioned earlier: 10 "The SDS Provider shall carry out the Services 11 required in respect of the Requirements Definition 12 Phase, the System-Wide Preliminary Design Requirements, 13 the Preliminary Design Phase, and the detailed design 14 phase in the order of "criticality" ... sequence and 15 dates shown in the Programme Phasing Structure." 16 With a qualification after that. 17 We can see it's worth, I think, going to the 18 Programme Phasing Structure which gives us other dates. 19 It's at page 112. This is Appendix to Programme Phasing 20 Structure. The dates are easier to read, I think, 21 thankfully. 22 We can see in the left-hand, two columns in from the 23 left, the description of the different sections of the 24 line, Airport - Gogarburn. We can follow that through to 25 the right, and we can see preliminary design approved by 125 1 28 February 2006, and detailed design approved by 2 30 September 2006. 3 We also then go one down. The section from Depot - 4 Haymarket, we see part of that section, the preliminary 5 design to be approved by 30 November 2005, and detailed 6 design by 30 March 2006. 7 I won't read them all out, but at least for the 8 phase 1b section of the line, I think we see dates for 9 detailed design to be approved by between I think 10 March 2006 and May 2006, and September 2006. 11 In short, those dates seem ambitious, given the 12 contract was signed in September 2005. I wonder whether 13 that is another indication that some time after contract 14 signature, the programme dates changed, including the 15 dates for production of the milestones you mentioned, 16 the requirements definition, the preliminary design, and 17 the detailed design. Does that seem correct, that at 18 some point after contract signature, the dates for these 19 milestones changed? 20 A. Yes, they did. 21 Q. Do you know when and how they changed? 22 A. I don't. Sorry. 23 Q. But when you arrived -- 24 A. When I arrived, the date for the preliminary design 25 delivery was 30 June 2006. And that was for the whole 126 1 of -- I think my recollection is the whole of phase 1a. 2 Q. Do you remember the date for detailed design when you 3 arrived? 4 A. I don't off the top of my head, sorry. 5 Q. It may be something I can explore with the Parsons 6 witnesses perhaps as well? 7 A. Possibly, yes. 8 Q. Thank you. 9 Put that document to one side. 10 Now, again, sticking with programme, I go back to 11 your statement, please, at page 10. This is a reply in 12 relation to a letter of June 2006 from Scott Wilson 13 Railways, the TSS provider to Andie Harper, and that's 14 what we've asked you to comment on here. 15 In paragraph 28 you say, a few lines down: 16 "I do, however, agree that the programme SDS had at 17 that point was insufficient in that it seemed to be 18 difficult to track progress or delays from one month to 19 the next as there did not appear to be a baseline to 20 compare updated programmes against." 21 To pause there, is your reference to the programme 22 SDS provided, is that similar to the very detailed 23 programme we've just looked at which formed part of the 24 contract? 25 A. Yes, it was the detailed Gantt chart that was about 127 1 48 pages. 2 Q. Thank you. Again, a similar theme. Can we go, please, 3 to page 75 of your statement. 4 In paragraph 196, the context of this, you referred 5 to Mr Crawley conducting a review in January 2007 of the 6 design. One of the individuals Mr Crawley spoke to was 7 Daniel -- I forget his surname just now -- Persson. 8 That's the context of this. 9 I think you had been asked to look at Mr Persson's 10 comments, and in paragraph 196 you say, about halfway 11 down: 12 "There also appeared to be no contractual penalty or 13 remedy for missing a deadline other than to terminate 14 the contract for breach of contract." 15 In the last sentence: 16 "SDS were churning out their programme month on 17 month but did not adhere to it; and tie had their 18 over-arching procurement programme which they were 19 bashing on with regardless of deadlines being missed, 20 and it was not all being drawn together." 21 I think that those two passages I have referred to, 22 I think, set out your position on the question of SDS's 23 programme unless there's anything you would like to add 24 to that. 25 A. I don't think there's much I can add to that, other than 128 1 to say that there was no way of easily tracking 2 slippage, and I understand the implications of that from 3 either programme. 4 There was a kind of silo approach to the design 5 programme and then the procurement programme. That's 6 all I was really trying to get across. 7 And the fact there was no penalty other than 8 termination means there's not really a stick to hit your 9 contractor with. There's nothing you can really pursue 10 against them at that point in time, other than to keep 11 pushing them to try and deliver against a programme. 12 But other than termination, which is quite a major step 13 to take at this point in a project, you are left with no 14 real remedy. 15 Q. When you left there were no penalties, is that because 16 the contract didn't contain, for example, a liquidated 17 damages clause if the programme wasn't met? 18 A. My recollection is it didn't contain that type of 19 clause. That might be one type of remedy you could have 20 imposed. 21 Q. Thank you. If we could put that to one side, please. 22 I would now like to look at the different milestone 23 phases. So firstly the requirements definition 24 deliverables. This was before you joined tie, but 25 I think that was delivered in December 2005. Does that 129 1 accord with your recollection? 2 A. It seems vaguely right, yes. 3 Q. Okay. Then moving on to 2006, we should -- you have 4 mentioned your involvement in the parliamentary process. 5 We should, I think, now go to page 31, if I may, of your 6 statement. You say in paragraph 77: 7 "I think that the SDS design contract was signed too 8 early. The SDS procurement must have started 9 Spring/early Summer for the contract to be awarded in 10 September 2005. We were still going through the 11 parliamentary process when the contract was signed. 12 I do not know for sure, but I assume SDS priced their 13 bid, which was accepted on the parliamentary plans and 14 sections. We were dealing with detailed route/design 15 issues in Parliament during the Summer/Autumn 2005 and 16 there were various route/alignment amendments promoted, 17 including key ones at Haymarket Yards, Newhaven and the 18 Gyle. At Haymarket yards, the route changed 19 completely." 20 Scrolling down the page, please, towards the right, 21 about ten lines from the bottom, you say: 22 "That process was not concluded until around 23 Christmas 2005 so at that point the baseline was not 24 fixed." 25 We know that the SDS contract was signed in 130 1 September 2005: 2 "The amendments were not passed by the Parliament 3 until the end of March 2006. As far as I was aware, 4 there was no constructive liaison with SDS about what 5 was coming out of the parliamentary process." 6 Over the page, please, to complete this, continue 7 this, in paragraph 78 you say: 8 "When I joined tie on secondment ..." 9 So this is in March 2006? 10 A. March/April 2006, yes. 11 Q. "... I met with the SDS team and did a brain dump ..." 12 You then pick it up again. The brain dump, which 13 was really a workshop: 14 "I took them "virtually" round the route and told them 15 everything they needed to know such as: the commitments 16 given to Parliament; key stakeholders; changes made in 17 Parliament to the original plans and sections; changes 18 to the limits of deviation; and third party agreements. 19 I think that was in March or April 2006 so around six 20 months after the SDS contract had been signed and so 21 with hindsight it is questionable what had been achieved 22 and whether around six months of the design and 23 consequently the project programme had already been 24 lost. I believe that no one appreciated that at the 25 time. With hindsight, if SDS had spent those six months 131 1 engaging with the Council to find out what their 2 priorities were at parts of the route ... that would 3 have been constructive use of that time but I don't 4 think that was done. I am not sure what they had done 5 up to that point. In my view, it was not until the 6 brain-dump that they set off on the right path, yet the 7 preliminary design was due in June 2006, only two/three 8 months later." 9 So in short, when you said the contract was signed 10 too soon, is that because in your view you don't think 11 it properly took into account changes through the 12 parliamentary process? 13 A. Yes, because from memory, SDS were designing a tram 14 within its limits of deviation. So until you fix the 15 limits of deviation, you don't have a baseline from 16 which you are starting your design. So arguably you're 17 varying the contract because you haven't started from 18 the right base point. 19 The route changes were quite significant. So 20 I would have thought that the contract should have been 21 signed once that was firmed up and approved. Even if 22 had been done January 2006, before final approval by the 23 Parliament, we were still fairly certain those would be 24 the new routes of limit of deviation, albeit you're 25 awaiting the final approval. 132 1 So I do think it was signed too early. 2 CHAIR OF THE INQUIRY: You really advocate waiting until the 3 legislation had gone through Parliament and even had the 4 Royal Assent before you started asking people to -- 5 A. No, I think it could have started before Royal Assent. 6 When you were confident that the route was in more or 7 less its final form. You do get an indication of that 8 as you're going through the Parliament. 9 Or a point where the initial -- the requirements 10 definition stage might have been done in a period prior 11 to Royal Assent. Knowing that you're kicking off the 12 preliminary design phase once you are very certain of 13 your parameters, your route, your commitments, your 14 limits of deviation. 15 So I don't think you have to do everything totally 16 sequential. I'm not sure starting a design team off in 17 September 2005 with two key areas under consideration 18 was perhaps prudent. 19 MR MACKENZIE: Thank you. Just finally on this point, you 20 refer to the meeting, the brain-dump with SDS in March 21 or April 2006. 22 When you advised the SDS team of the parliamentary 23 changes, was that something they were aware of or what? 24 A. From memory, no, I don't think they were aware of them. 25 My recollection at the time was that when they had 133 1 entered into the contract, they got past the 2 parliamentary plans and sections which had the limits of 3 deviation on them. They got past, I think, copies of 4 the state of the agreements with third parties. And 5 then left to get on with it. But I don't think they 6 were appraised, you know, on a weekly basis or a basis 7 of the changes that were coming through the Parliament 8 which would feed into and affect their design. 9 Q. Thank you. 10 Just moving on, I think we know that the preliminary 11 design deliverables were delivered at the end of 12 June 2006, which I think was in accordance with the 13 agreed timescale; is that correct? 14 A. The agreed revised timescales at that time, yes. 15 Q. Thank you. I think I won't go to it, but I think under 16 the contract tie had 20 business days to respond. I'll 17 give the reference in passing. It's contained in 18 Schedule 9 of the contract. The review procedure at 19 page 290. 20 I think in the event no comments were made within 21 that 20-day period, and if we, for example, go to 22 a letter at CEC01794964, we can see this is a -- blow it 23 up a little -- letter from Parsons Brinckerhoff dated 24 26 September 2006, addressed to Ailsa McGregor, who 25 I think by this time was in post and was the SDS 134 1 Contract Manager, is that correct? 2 A. That's correct. 3 Q. We can see it states, the second paragraph, that: 4 "The SDS Preliminary Design was submitted on 5 30th June 2006. The agreed review response period, in 6 accordance with our Agreement, ended on 28th July 2006." 7 That's 20 business days: 8 "No formal response comments were received from tie 9 by this date. 10 "Any late review comments which result in the 11 re-working of documentation will have a disruptive effect 12 on the delivery of our main programmed works." 13 Now, you do then in your statement go on to explain 14 what happened when Preliminary Design was received at 15 the end of June 2006. If we then go back to your 16 statement, please, at page 13, to look at that. 17 Towards the bottom of paragraph 34, a sentence 18 commences "From memory": 19 "From memory at the end of June 2006 when SDS 20 delivered the preliminary design to tie, CEC were only 21 given a week to approve the preliminary design which 22 comprised over 300 drawings and associated documents 23 without having had any meaningful input into the process 24 prior to that. From memory, such a short timescale was 25 required so that tie could comply with the sign off/no 135 1 objection timescales in the contract." 2 I think that's again a reference back to Schedule 9 3 of the review process and the contract. 4 But you go on again, please, to explain this 5 further. If we then go to page 35 of your statement, 6 about two thirds of the way down paragraph 85, you 7 mention again: 8 "From memory, I think CEC were given a week to 9 approve the preliminary design outputs, although I do 10 not think it was clear whether they would be approving 11 the designs as promoter or also as the planning and 12 roads authorities. That meant that people who had no 13 previous involvement in the evolution of the design were 14 expected to look at and understand the designs in that 15 very short time frame." 16 Then: 17 "My recollection is that the contract built in 18 a process for tie to approve the design but that there 19 was not a specific process for obtaining sign off from 20 CEC. On receipt of the preliminary design, there was 21 kickback from CEC. They felt that the time frame for 22 approving it was insufficient and there had been no 23 account taken of any of their concerns as ... CEC were 24 of the view that what had been produced was simply not 25 acceptable." 136 1 So, in short, what happened next? 2 A. What happened next? The Council came back not very 3 pleased with the preliminary design, and there was 4 a view, I think under the contract review procedure, 5 that a review form could be filled in with comments and 6 that be passed back to SDS as part of the approval or 7 sign off no objection process, but the level of comments 8 were so extensive that there was no way you could start 9 with that process. 10 So there was discussion at that point, I think at a 11 higher level between Andie Harper and Andrew Holmes as 12 to how to get through the stage in the preliminary 13 design, because obviously you had to close out the 14 preliminary design in some way, to move on to the 15 detailed design. 16 And at that point comments weren't passed to SDS, 17 although from recollection, I would say they were aware 18 of the issues that were ongoing between tie and CEC 19 regarding the design, and what came out of this whole 20 process was the design approval panels and this 21 evolution of Preliminary Design 1, as it was then 22 called, to Preliminary Design 2, which allowed parties 23 to discuss the design, add in their comments, and SDS to 24 have another iteration in effect of the preliminary 25 design. 137 1 Which wasn't foreseen in the contract at all. 2 Q. We will come back to that in a little more detail 3 shortly. Going back to your statement, please, another 4 passage at page 36, in paragraph 86. You mention: 5 "A protocol was entered into, and as long as CEC 6 were provided with the type of drawings they wanted, 7 they turned everything around within the agreed time 8 limits. In my opinion, once the process was up and 9 running and the CEC planners were bought-in, it ran 10 quite smoothly. Prior to that, the problem had been the 11 lack of thought as to what was required. I think that 12 is why the problems arose and both tie and SDS were 13 responsible." 14 Where you talk about this protocol being entered 15 into, when was that roughly? 16 A. I'm not sure when that was, and that protocol related to 17 the prior approval process rather than the actual 18 preliminary design process. So it was in that context 19 that the protocol was entered into, to allow that 20 process to be smoother and to allow SDS to understand 21 the type of drawing that was required in the context of 22 planning approval process, as opposed to an engineering 23 drawing. So that's the context that comment is made in. 24 As opposed to in relation to the preliminary design. 25 Q. In terms of timing, do you think that was late 2006 or 138 1 some time in 2007, or you're not sure? 2 A. That probably sounds about right, because you wouldn't 3 be thinking about getting prior approval consents until 4 you're through your preliminary design process, because 5 prior approval relates to the aesthetics and the 6 details. So you don't get that until you are in 7 a detailed design stage. So it seems right that was 8 discussed and entered into late 2006/start of 2007, when 9 parties were thinking of progressing hopefully into the 10 detailed design process. 11 Q. Thank you. 12 Another page in your statement, please, page 15. At 13 the very top, paragraph 38, the first sentence. This is 14 in relation to an email dated June 2006. You say: 15 "The email was sent around the time when the 16 preliminary design was delivered, which was when 17 everyone realised the design process was so broken that 18 something drastic was needed to fix it." 19 By the design process being so broken, is that 20 a reference to the Council not having previously been 21 involved in the process or what is that a reference to? 22 A. It's -- it should probably be a reference to the design 23 review process. And the acceptability of the 24 preliminary design, that the whole anticipation that 25 could happen in 20 working days was not going to happen. 139 1 Q. Just for the avoidance of doubt, when you say something 2 drastic was needed to fix it, I assume that in short was 3 a greater involvement by the Council in the process? 4 A. Greater involvement by the Council as both planning 5 authority and the roads authority, and the promoter, and 6 what ownership by the Council. 7 Q. How was that done? 8 A. It was done through a couple of things. The design 9 approval panels, which got all the key stakeholders 10 round the table to discuss their concerns with the 11 preliminary design, and also by co-locating Council 12 employees within the tie offices. 13 Q. Did these things take place from June 2006 onwards? 14 A. I would say probably from the August 2006, because 15 prelim design was 30 June. July was probably spent 16 discussing the whys and wherefores for the state of the 17 preliminary design. So I think it was August/September 18 time, again after the summer break as well, when people 19 started co-locating and the design approval panel 20 started. I think they may have started, yeah, 21 August/September 2006. 22 Q. Thank you. I think we've also seen reference to various 23 charrette meetings. Was that something else that took 24 place in the second half of 2006 to try and ascertain 25 CEC's preferences for various design options? 140 1 A. Yes, and they were related to key distinct parts of the 2 route. So St Andrew Square, for example, was subject to 3 a charrette. The structure going through into 4 Edinburgh Park was subject to a charrette. It was -- 5 parts of the route where the Council had key concerns 6 because it was maybe a World Heritage site issue or the 7 entrance into the city for other people. So there were 8 very discrete elements of the route, whereas the design 9 approval panel looked at key sections of the route. 10 So they happened at the same time, effectively, two 11 separate processes. 12 Q. Thank you. I'll come back to that a little, but so 13 I don't forget, can I clarify one thing, please, at 14 page 37 of your statement. It's in paragraph 87, the 15 first sentence, where you say: 16 "Arguably, the attempts to resolve the problems 17 meant that a lot of the risk was taken back from SDS, at 18 least implicitly, if not expressly." 19 What did you mean by that? 20 A. What I think I meant by that was there was an 21 expectation that I think SDS would design -- it was 22 almost a box-ticking exercise for getting the approval 23 or sign off from tie. Then SDS did detailed design and 24 it was constructed. 25 Here what is happening is the Council are to 141 1 a greater extent influencing the design and the outputs 2 from SDS. So ultimately, for example, if the Council as 3 promoter wanted a certain structure at going into 4 Edinburgh Park, the Edinburgh viaduct, which ultimately 5 didn't get prior approval, arguably that risk would sit 6 with the Council because they had influenced or dictated 7 the design. 8 So those are the kind of examples I'm meaning, where 9 the risk was transferred back to the Council. 10 That's not to say that that was necessarily a bad 11 thing. Because risks do sit with the party who is best 12 able to manage it, and in some respects some of these 13 issues were being led by the planning authority. So the 14 risk was actually less if you expected to get prior 15 approval for the changes that were coming from the 16 Council, but the risk was moving slightly. 17 Q. Thank you. 18 If we then just refer to two documents during this 19 period by way of illustration. 20 Firstly, CEC01829874. It's simply to try and give 21 a flavour of what was happening during this period. 22 We can see, towards the top, this is a letter dated 23 30 November 2006 addressed from Parsons to 24 Ailsa McGregor. I should have paused to ask, did 25 Ailsa McGregor report to you? 142 1 A. Yes, she did. 2 Q. We can see the heading of the letter is "meeting with 3 CEC for charrette area comments", and Parsons say here: 4 "We write with reference to tie progress with 5 resolution of design issues which have formed the basis 6 of the series of charrettes and the planning summits. 7 Through this process SDS had understood that the 8 proposed solutions for Foot of Leith Walk, Leith Walk, 9 Picardy Place, St Andrew Square, Shandwick Place and 10 Haymarket had been discussed and resolved in concept and 11 that the proposed design presented and agreed at the 12 planning summits could be developed into detailed 13 design." 14 Then a reference in the third paragraph to a meeting 15 on 28 November, and the paragraph after that states: 16 "At this meeting CEC advised that contrary to the 17 decisions made at the planning summit and the advice 18 received at the meeting of the Tram Design Working Group 19 on 22 November 2006, several areas covered by charrettes 20 would receive a red status ... (ie could not proceed into 21 detailed design)." 22 That was a reference to Leith Walk and over the page 23 you see a reference to Picardy Place, and fourth -- it's 24 Picardy Place, St Andrew Square, Shandwick Place. 25 The second last paragraph: 143 1 "In general, SDS were extremely disappointed at the 2 comments received, and that they were not highlighted at 3 earlier opportunities with the amount of detailed 4 dialogue that has occurred on the areas in recent 5 months. The designs have been progressed in good 6 faith ..." 7 CHAIR OF THE INQUIRY: Mr Mackenzie, could you slow down? 8 MR MACKENZIE: The designs have been progressed in good 9 faith in co-ordination with the outcomes of the 10 charrettes and in close co-ordination with CEC during 11 the developments." 12 I think, in short, a concern about not being able to 13 progress on to detailed design because the Council had 14 still not completely decided what they want in relation 15 to these areas; is that fair? 16 A. I think that's fair from that letter, that that's how 17 SDS felt. I think from the Council's perspective, 18 I think it's very difficult to understand what you're 19 going to get until you see a design. Because the limits 20 of deviation are just that. They're two lines generally 21 pavement to pavement that the tram is going to go in, 22 and within CEC, they do wear various hats as promoter, 23 planning authorities, roads authority, and I think they 24 did find it difficult in some respects to get 25 a consensus as to what the priorities were, whether it 144 1 was cycling, whether it was parking, whether it was 2 public realm, and that, I think, did have an impact on 3 how SDS could progress, which I think is captured in 4 that letter. 5 Q. Yes. 6 CHAIR OF THE INQUIRY: Were all of these not represented at 7 the charrette process? 8 A. Sorry? 9 CHAIR OF THE INQUIRY: Were all of these different 10 disciplines, if I put it that way, within CEC not 11 represented at the charrette? So in other words, could 12 you have somebody from CEC at the charrette, saying: 13 yes, that's fine, and then it goes on to further work 14 and goes back to CEC Planning Department or somewhere, 15 who say it's not fine. 16 A. I think from memory -- and this really is racking my 17 brains, I think the charrettes were a higher level in 18 that it was Andy Harper and Andrew Holmes. I think 19 there was probably guidance given at that level as to 20 what the priorities were, and what the design needed to 21 incorporate, whether it was a cycle path or a wider foot 22 pavement or work parking. When it came down to the 23 design approval panels, you've got the next tier of 24 Council representatives at those meetings, who perhaps 25 once they saw the drawings maybe had an expectation 145 1 there was going to be more parking or a wider footpath 2 or a better cycle way. 3 So I think it was maybe managing expectations within 4 the Council, perhaps, as to what would come out of the 5 design. But I can see it seems a bit odd that you agree 6 something at a charrette process that perhaps later on 7 is not acceptable. It does make it quite difficult for 8 SDS. 9 CHAIR OF THE INQUIRY: It probably involves more work, and 10 therefore a claim for extra payment, does it? 11 A. Potentially, but being devil's advocate, if they perhaps 12 engage sooner in the process, they would have a better 13 understanding of what the Council's priorities were, and 14 their expectations of what they wanted to see in certain 15 areas. St Andrew Square for the Council is a key 16 location. At the time of the tram project, they were 17 public realms projects, already been considered. They 18 were trying to tie the two together. Had there been 19 better engagement on both parties' parts, early on, 20 perhaps from September through the early part of 2006, 21 you shouldn't have ended up in the situation where 22 you're trying to bottom out key design issues through 23 this kind of process. 24 CHAIR OF THE INQUIRY: So the difficulties that SDS were 25 experiencing, you say, were really a function of their 146 1 failure to engage and the city's failure to engage with 2 them much sooner? 3 A. I would say so. I think both parties should have been 4 engaging a lot sooner. It was the Council's tram. It's 5 the Council's city. They obviously had an idea in their 6 mind what they expected to see. Unless you communicate 7 that to the designers, they'll have their own vision of 8 what they want to do and it's very much an engineering 9 vision because they are engineers. Whereas the Council 10 were coming at it from more of a design softer public 11 realm angle as well. So yes, I think both parties 12 should have engaged a lot sooner to understand and 13 manage those expectations. 14 CHAIR OF THE INQUIRY: Thank you. 15 MR MACKENZIE: Just on the question of claim for the 16 charrettes work, could we please go to document 17 CEC01629062. 18 The email in the second half of the page is from 19 Ailsa McGregor, on 23 July 2007, to Geoff Gilbert. 20 I think you are copied into this one, Ms Craggs. 21 The subject is SDS Claim/tie counterclaim. 22 What Ms McGregor does here is summarise various high 23 level events that led to delays to the project, as we 24 see. 25 Over the page, please, page 2, in paragraph 13, we 147 1 see a reference to the charrette deal of GBP600,000, and 2 the two interchanges changes at approximately GBP100,000 3 each included for all preliminary and detail design 4 associated with these elements. 5 So on the face of it, it looks as though tie agreed 6 to pay SDS GBP600,000 in addition to the charrette work; 7 is that correct? 8 A. I think that's correct, yes. 9 Q. That on the face of it would suggest that SDS have to 10 undertake a reasonably significant amount of work, in 11 that regard. Would that seem fair? 12 A. Yes, there was a significant amount of work, yes. 13 Q. Thank you. We can put that document to one side. 14 Just to finish off with the preliminary design 15 phase, if we can go to another document, please, which 16 is in December 2006, the reference is PBH00026782. We 17 can see it's a report produced by Scott Wilson, the TSS 18 supplier. Preliminary design review report dated 19 6 December 2006. 20 It's quite a chunky document, but if we can go, 21 please, to page 5, to look at the Executive Summary, and 22 the last two paragraphs I'll read out. It states: 23 "The engineering aspects of the project seem 24 generally to be on course with the structures a notable 25 exception. These elements have been subject to recent 148 1 interest and decisions are outstanding on certain design 2 aspects. This is not something that SDS can be held 3 wholly responsible for. Away from the hard engineering, 4 a number of the softer issues would appear to be 5 outstanding. It is clear that these will require to be 6 addressed in early course given their impact throughout 7 the project." 8 To pause there, is the reference to softer issues to 9 do with the planning aspects? 10 A. Can I just ask what date this document is? 11 Q. Sorry, yes. It is dated 6 December 2006. 12 A. I think that is a reference to the planning aspects and 13 probably the softer design elements. 14 Q. I think we have heard from engineering witnesses that in 15 many ways it was easier to pin down the engineering 16 aspects because they were more specific, whereas 17 planning aspects involved aesthetics and matters of 18 subjective opinion and judgment? 19 A. I think that's correct, yes. 20 Q. Just returning to this report, the last paragraph -- I'm 21 not sure I read out the last sentence, the second-last 22 paragraph stated: 23 "It is clear that these will require to be addressed 24 in early course, given their impact throughout the 25 project." 149 1 The last paragraph: 2 "Our overall conclusion is that the bulk of the 3 Preliminary Design submission is now either acceptable 4 or acceptable given the responses from SDS." 5 So I think to summarise or paraphrase, I think in 6 short this report was given a qualified acceptance to 7 the preliminary design. Would that be a fair -- 8 A. That's a fair summary. 9 Q. If we go then to page 7, to look at simply one sentence. 10 In the paragraph commencing: 11 "By mid-October it became clear ..." 12 So that's a reference to mid-October 2006: 13 "... that the overall review process was in somewhat 14 disarray and required to be closed out with SDS." 15 Would you have agreed with that description of the 16 overall review process as being somewhat in disarray? 17 A. Yes, I would agree with that. 18 Q. Just lastly, so we can note in passing that without 19 going to it, if we can go -- we will go to, if not read 20 it out, page 87, please. If anyone wishes any more 21 detail beyond the executive summary, we can see on this 22 page and the following page a little more is said about 23 the conclusions relating to each discipline. So, for 24 example, track is set out, structures is set out. 25 Over the page, we see the heading "Roads", and 150 1 "Traction Power". 2 Then I should also please go to another email from 3 Steven Bell. The reference for this is CEC01672004. 4 It's an email at the bottom of the page from 5 Steven Bell, dated 20 December 2006. The subject is 6 "Review of TSS report on SDS preliminary design". 7 I think Mr Bell was a Director of Engineering and 8 Procurement at this stage; is that correct? 9 A. I think so, yes. 10 Q. Mr Bell states: 11 "Having reviewed the TSS report on SDS Preliminary 12 design, it raised a number of important issues." 13 Then two more paragraphs down: 14 "Having carried out the review and considered 15 Douglas's initial response, I do not consider 16 Preliminary Design closed out to tie and TSS 17 satisfaction, principally because of the following 18 outstanding items." 19 Over the page we can see various bullet points. 20 I'll simply go to the first four. One is: 21 "No utility designs have been included within the 22 review." 23 Secondly: 24 "Track section ..." 25 No drainage design, and then structures are not at 151 1 a satisfactory stage. 2 So that's where things were left then. 3 Again, just to complete, 2006, if we go to 4 a separate document, please, it's TIE00040947. 5 We can see this is headed, "The Tram Project SDS 6 Contract Reporting Period 15 to December 2006". 7 It's simply the three circles in the very middle, 8 performance by phases. 9 If we look at the one with red, if we can blow up 10 the detailed design, we can see at this stage detailed 11 design had been planned to have completed 71.9 per cent, 12 and in fact 28.3 per cent had been completed. 13 Putting to one side the precise accuracy of those 14 figures, is that general picture recollect with your 15 understanding of how things were at that time? 16 A. Yes, it does. 17 Q. Thank you. 18 Now, in terms of how all of this could have been 19 avoided, can we go, please, to page 38 of your 20 statement. In paragraph 89 you explain: 21 "The problems could have been avoided if: SDS had 22 started the design process from the right baseline." 23 Is that a reference to waiting until the 24 parliamentary changes had been finalised? 25 A. Yes, it is. Where the rate changes were finalised as 152 1 part of that process. 2 Q. And continuing: 3 "There had been a better understanding by both 4 parties of what the design and consents outputs would 5 look like; there had been a period of proper engagement 6 at the outset; all parties had clearly understood and 7 respected CEC's role and that this was reflected in the 8 contract; and CEC had properly engaged with the project 9 from the outset. I think it was all totally avoidable." 10 When you set it out that way, it all seems very 11 simple. Do you agree? 12 A. It does with the benefit of hindsight. And it does seem 13 very simple. I accept that back in 2006/2007, it was 14 a very, very busy hands on project. There was a lot of 15 things happening. So it is easy for me to put that down 16 now, with hindsight. 17 But I still think that with hindsight, had some of 18 these points been taken on board, and there was time to 19 do that from the signing of the SDS contract, even if it 20 had been signed in September, which I think is a bit 21 early, through to the end of the parliamentary process, 22 there was time to engage. There was time to take on 23 board CEC's comments. There was time to manage what 24 outputs would look like. There was time to get an 25 understanding of what CEC wanted and required in terms 153 1 of parking, public realm. There was time in the process 2 to do that. 3 Had the parties, I think, understood that ultimately 4 this was CEC's tram, they were the promoter, albeit they 5 were procuring it through their arm's length company, it 6 was still their tram. And they were more than just 7 a key -- a stakeholder to tick the box because you have 8 gone and met them a couple of times and got some views. 9 They were central to what was going to be acceptable, 10 and I do think that had this been done, some of the 11 problems would have been avoidable. And there was time 12 to do that. 13 Q. Thank you. 14 I would like to park that issue there just now, and 15 move on to something else, please. If we can go to an 16 email, the reference number is CEC01797628. 17 A. Sorry, can I say one supplementary point to my last 18 answer. 19 Q. Sorry, please, yes. 20 A. I should also probably, to be fair to all the parties, 21 say that that presupposes that the Council were going to 22 engage, and would have been open to that engagement and 23 taken ownership and responsibility for being part of 24 that process too. So it had to be a two-way 25 relationship, not just -- I'm not trying to say SDS 154 1 didn't do it. The Council had to come forward at that 2 time as well. 3 Q. Yes. Something we have seen from other documents 4 witnesses is the need for an integrated one team 5 approach. It sounds like the sort of thing you are 6 describing; is that right? 7 A. Yes, it is. 8 Q. Thank you. This document is an email you sent on 9 20 November 2006 to Geoff Gilbert and Andie Harper. 10 Subject, OGC concerns. I think you were due to meet 11 with the OGC panel, and you say in the second paragraph: 12 "However I would have thought that they would also 13 want to discuss progress to date, the ITN and the bid 14 process to date." 15 I think that's in relation to the Infraco 16 procurement: 17 "As you know I have various concerns about the 18 procurement process to date and in particular the 19 following." 20 The first point concerns the quality of the ITN and 21 the ability to get a robust price from the 22 ITN/employer's requirements. What were your concerns in 23 that regard? 24 A. Well, if we go back to go when ITN went out, which was 25 October, I'd already made my feelings clear that the 155 1 project should be paused because I didn't think that ITN 2 was fit for purpose. 3 If you want to get a good price or best price from 4 your tenderers, you can be very clear and precise as to 5 what you are procuring, and given the state of the 6 design at that stage, which hadn't been closed out, and 7 the vagueness of some of the aspects of the employer's 8 requirements, which could have been open to 9 interpretation, and therefore open to different pricing, 10 I felt that was a weakness in our process which meant 11 that by the time you get the tenders back, you may not 12 be comparing apples and apples in pricing, which makes 13 it very, very difficult then to assess the bid you are 14 getting and to find out which is potentially preferred 15 bidder. That was really my concern there. 16 Q. Thank you. 17 If we can go to your statement to see the response, 18 at page 24, please, in paragraph 59. Halfway through, 19 you say: 20 "My recollection is that I had discussions 21 throughout that time and I was consistent in what I was 22 saying about the procurement process in that we were not 23 ready to start it. I think there was perhaps an 24 acknowledgment from Andie Harper that my concerns were 25 valid however, it was made clear to me by Andie, 156 1 Susan Clark and Geoff Gilbert that we had to keep to the 2 programme despite the status of the design." 3 I apologise if I have asked you this already, but 4 why was it that you had to keep to programme despite the 5 status of the design? 6 A. I think because ultimately the end date for awarding the 7 contract, allowing a construction period and then 8 operating the trams wasn't moving. 9 So if that wasn't moving, you had no option but to 10 either start your procurement as you planned to, or 11 reduce your procurement time frame, which didn't seem to 12 be palatable either. 13 CHAIR OF THE INQUIRY: Do you know why the end date was 14 fixed and unable to be changed? 15 A. I don't know if it was political. There was a slogan at 16 one time about having trams for Christmas. 17 CHAIR OF THE INQUIRY: We heard -- 18 A. I can't remember which Christmas it was. 19 CHAIR OF THE INQUIRY: 2010, I think it was, yes. We heard 20 from one witness this week that that was achieved in the 21 sense of one tram on Princes Street. 22 A. I don't think it was a running tram on Princes Street. 23 CHAIR OF THE INQUIRY: It moved two revolutions each way 24 just to stop it seizing up. 25 A. I don't know if it was a politically driven deadline, 157 1 or, as I have said before, because we had not been 2 reporting that there are serious issues with the 3 programme, it was almost too late now to start opening 4 that debate up. So therefore it was very much we will 5 keep to our programme. 6 Also I think perhaps we may have factored into the 7 thinking that when you start a procurement process, you 8 set out in the outset in your ITN the timescale for that 9 process, because bidders are entering into 10 a procurement, and bidding usually not getting any costs 11 for taking part in that process. They don't get bid 12 costs generally. 13 So they want to know that the procurement process is 14 managed, well managed, not tight process but sufficient, 15 but they still want to know the key parameters, and when 16 contracts might be awarded. And once you put that out 17 to the tenderers, you are almost driven to try and 18 achieve that programme, unless you go out and change it. 19 But then that could undermine confidence in your 20 process. 21 MR MACKENZIE: Perhaps one final document to you from 2006. 22 That is CEC01796724. We can start at the bottom of the 23 page, please. We see an email from Geoff Gilbert dated 24 23 October 2006 to Richard Walker, Mr Dalton, et cetera, 25 of the consortium. 158 1 Then over the page, please, we can see it's copied 2 into Bob Dawson and to yourself. The subject matter is 3 detailed design priorities. 4 Mr Gilbert sets out: 5 "Further to our recent discussions I enclose our 6 proposed priority for the preparation of detailed 7 design. Could you review this to advise any adjustments 8 to this prioritisation with a view to providing price 9 risk critical design information first." 10 So in short, I think what's happening here is that 11 Mr Gilbert, as part of the commercial or procurement 12 team, is discussing with the bidders the change in the 13 priority for the preparation of detailed design. 14 Over the page, please, to page 1, the next email is 15 from yourself, dated 23 October 2006. Responding to 16 Mr Gilbert, saying: 17 "Geoff, thanks for this - how did we come up with 18 this list - does it reflect what all the bidders 19 require? Has Andie seen this? Have we considered the 20 impact this may have on MUDFA? What timescales would 21 this require to be delivered to? 22 I think we need to bottom out these issues asap - 23 this seems to be a case of the tail wagging the dog 24 again." 25 What is the reference to the tail wagging the dog? 159 1 A. It's the procurement tail wagging the design dog 2 effectively. Rather than allowing SDS to complete the 3 detailed design in accordance with the programme, we're 4 reprioritising, I felt at this point without having any 5 regard as to what SDS thought about it, and therefore 6 you're changing the parameters for SDS continually. 7 Purely for the procurement process, not necessarily for 8 the betterment of the design or trying to close out the 9 design process or the consents. 10 Q. What difficulties, if any, did that cause for SDS or for 11 the design programme more generally? 12 A. From recollection, I think what happens is SDS then have 13 to reprioritise their work, and they are working to 14 obviously their own work plan to try and hit deadlines. 15 That gets reprioritised. Things may not be then done in 16 the right order to allow them to do interdisciplinary 17 checks or could have an impact, as I have said there, on 18 MUDFA design, so MUDFA could be digging up in accordance 19 with one design which then changes through detailed 20 design. 21 So I think they then -- SDS then have to totally 22 restructure what they are doing to fit in with our new 23 list of priorities. 24 Q. You refer in your email to a case of the tail wagging 25 the dog again. So it had happened at least on one 160 1 previous occasion; is that correct? 2 A. Yes, I think I used that term in an earlier email, 3 I think in relation to the reprioritising of the close 4 out, the preliminary design, in order to get certain 5 drawings to Infraco, I think. I did use it in a similar 6 context previously in an email. 7 Q. And to continue with the metaphor, did the tail keep on 8 wagging or stop? 9 A. I'm -- I think probably the tail did keep on wagging for 10 a certain amount of time, and then probably stopped as 11 you get further through the procurement stage. 12 MR MACKENZIE: Thank you. My Lord, that may be a suitable 13 time to take a pause. 14 CHAIR OF THE INQUIRY: We will have a break of ten minutes, 15 I think, if we can. Are we all right to finish this 16 witness? 17 MR MACKENZIE: My Lord, I may be about another -- between 30 18 and 45 minutes. I'll certainly finish today. It's just 19 a question how close to 4 o'clock I can finish. 20 CHAIR OF THE INQUIRY: We will give you 15 minutes then. 21 3.25. 22 (3.10 pm) 23 (A short break) 24 (3.26 pm) 25 CHAIR OF THE INQUIRY: You're still under oath, Ms Craggs. 161 1 MR MACKENZIE: Thank you, my Lord. 2 We had referred to a review carried out by 3 David Crawley in January 2007. If we can go to that 4 document, please. It's CEC01811257. 5 Now, I think you mentioned you have no recollection 6 of this review; is that correct? 7 A. That is correct. 8 Q. So what I would like to do, please, is go to page 8. 9 This is a record by Mr Crawley of his interview with 10 you. All I would like to do is to give you a minute to 11 read that, and let us know whether, although you can't 12 remember the interview, this is likely to have accorded 13 in general with your views at the time. (Pause) 14 A. That does reflect my thinking at the time, yes. 15 Q. Thank you. I would like then to move on to another 16 document. CEC01826622. This is an email from yourself 17 dated 9 February 2007 to Matthew Crosse. The subject 18 matter is a "TEAM LEADERSHIP MEETING". I think Mr Crosse 19 must have been relatively recently appointed as the new 20 Tram Project Director around this time; is that correct? 21 A. That's correct, yes. 22 Q. We see under issues this week, in the second half of the 23 page, under 2: 24 "SDS/programme/priorities et cetera - 25 you know what the position is here. Re programme, 162 1 I understand that some members of the team are asking 2 SDS to prioritise/de-prioritise work to expedite eg 3 utilities. This is being done in isolation and could 4 prejudice other work streams. This and the point below 5 have to stop if we are to stick to one programme and 6 deliver." 7 Is this another example of what we were discussing 8 just before the break of the tail wagging the dog? 9 A. Yes, it is. 10 Q. Do these instructions appear to be coming from the 11 utilities team in tie? 12 A. From recollection, I don't think it was just an issue 13 around utilities. I think SDS are being instructed by 14 various people on different aspects of the design. 15 Q. We also then see in paragraph 3, procurement, you go on 16 and say: 17 "This is another example of not sticking to 18 programme, diverting SDS, et cetera. This has to stop - 19 we can't be reactive to bidders." 20 Is that an example of what we were discussing just 21 before the break? 22 A. Yes, it is. 23 Q. Thank you. Could we look then -- continuing on the 24 matter of Infraco procurement -- at a document at 25 CEC01793907. We can see this is an email from yourself 163 1 dated 1 March 2007 to Geoff Gilbert, subject Infraco 2 procurement. In the second paragraph you say: 3 "I am becoming increasingly concerned that the 4 position we are conveying to the bidders deviates from 5 the procurement strategy and I'm not sure we have 6 authority to do that. In addition, I feel that 7 sometimes the position we are adopting does not 8 represent the view of the team - eg in relation to 9 prior approvals I understand that we have advised one 10 bidder that tie will take this risk - I have explained 11 why this is not appropriate and I worry that there is 12 sometimes a lack of understanding." 13 What did these concerns relate to? 14 A. It relates to being reactive to what bidders were 15 requiring us to do. So in that situation clearly when 16 the bidders didn't want to take on the risk of the prior 17 approvals, which at this stage in the process the 18 process may have started on prior approvals, but it may 19 not have done. 20 So clearly Infraco are saying we don't want to take 21 that risk, and what I was trying to say was that 22 represented a departure from the SDS contract, because 23 it's their scope to get the prior approvals. 24 Therefore, how does that impact on the proposed 25 novation of the SDS contract into Infraco? How do you 164 1 square off how that risk sits, where you have given 2 different parties an indication of who was doing what. 3 It was also my concern that whilst we said that to 4 one bidder in the course of a bidding meeting during the 5 tender process, my understanding at that time was we 6 hadn't actually conveyed the same position to the other 7 bidder. So therefore again, you're not comparing apples 8 and apples when you get to price, because you are 9 pricing different risk allocations and different scopes. 10 I was also, I think, not everyone, I think, 11 understood some of the consenting processes, how they 12 related to design, how they then related to the 13 construction. So it's a whole panel of concerns that 14 I was trying to convey to Geoff at that point. 15 Q. Thank you. 16 Then two paragraphs down you said: 17 "In addition there appears to be no management of 18 the next drop of information nor a coherent plan of what 19 we are trying to achieve. I just feel we are losing our 20 way with this." 21 With this, is that a reference to the Infraco 22 procurement process? 23 A. I think so. It's hard just reading that quote now. But 24 it probably was a reference, yes, to the procurement 25 process and the fact that we should be driving the 165 1 process, not just responding to, you know, what bidders 2 are looking for from us. There should be some purpose 3 and intent to what we're trying to do and we retain the 4 control of that. That is what I was trying to get at 5 there. It's slightly difficult, with hindsight, because 6 it's quite bland on the face of it, but I think that's 7 what my concerns were. 8 Q. Then, second last paragraph, you say: 9 "You may have views on this." 10 Do you remember whether Mr Gilbert did speak to you 11 about this? 12 A. From recollection I think we might have had a phone call 13 discussion on it. I couldn't say for certain, but 14 I think we may have had a phone call discussion on it. 15 Q. What did Mr Gilbert say? 16 A. I think from recollection, he tried to reassure me that 17 everything was under control and not to worry. But I'm 18 not sure that satisfied me. I thought there were still 19 concerns there. 20 Q. You go on to say: 21 "I am going to speak to Matthew about this." 22 That must be Matthew Crosse. Do you remember 23 whether you did speak to Matthew Crosse about that 24 around that time? 25 A. I can't remember, to be sure. 166 1 Q. Thank you. 2 Just to continue a little in time, can we go back to 3 your statement, please, to page 28. 4 CHAIR OF THE INQUIRY: Before leaving that email, it seems 5 that you're apprehensive that he might take it the wrong 6 way, as it were. Was that a reasonable apprehension to 7 have in respect of Mr Gilbert? You say: 8 "... you won't see this as interference, and it is 9 not intended to be critical. We're all busy, but we 10 can't afford to get this wrong." 11 Finally you say, well, you offered to speak to him 12 first before going to Matthew Crosse: 13 "Please don't take this in the wrong way. I'm 14 trying to help." 15 Reading that, is there some underlying impression 16 that you might have been apprehensive or 17 am I misinterpreting that? 18 A. No, I think it's a fair trade back from what I have 19 written there. I think I have said elsewhere in my 20 statement that around this time my input wasn't always 21 welcomed. Probably because I wasn't going along with 22 maybe the party line and where things were going, and 23 I was raising concerns, and whilst I wasn't part of the 24 legal team advising on the procurement process and 25 running the procurement process, I felt given my role, 167 1 I had duties to the client to voice concerns where 2 I thought there were concerns, but they weren't always 3 welcomed or received with the right intent, I felt. 4 So to try and get Geoff to engage with some of this, 5 I was trying to soften it a little bit to make it clear 6 I wasn't trying to interfere. Everyone was busy. 7 I think everyone was trying their best, but I was trying 8 to be constructive and avoid problems which I could see 9 or foreseen may happen if we carried on down a certain 10 route. 11 MR MACKENZIE: Thank you. I think on a similar vein, 12 page 28, please, of your statement, in paragraph 70, 13 picking up on the point you've just mentioned, you say: 14 "From around September 2006, I was probably viewed 15 by the Project Director and others at a senior level 16 including Geoff Gilbert and Susan Clark and perhaps 17 Willie Gallagher as being quite negative and critical. 18 I was challenging what was happening and I think Geoff 19 sometimes took it personally - ie that I was having a go 20 at his strategy. That is not what I was doing. I felt 21 that to do my job and advise tie properly, I had to 22 challenge things that I thought were not right. It was 23 not always comfortable for me, but to retain my 24 integrity and to advise tie and CEC properly, I could 25 not just go along with it because someone was saying 168 1 this is the strategy and I do not want to hear it." 2 To pause there, why was it not always comfortable 3 for you at that time? 4 A. Because it felt I was a lone voice. And it's very hard 5 when you're a lone voice, and people don't want to hear 6 that, to continue trying to push back on it. And no one 7 was very receptive to it at that point in time. 8 Q. How about this other angle in the sense that you at this 9 time, you weren't, I think a partner in your firm; you 10 were a senior associate? 11 A. I was senior associate. 12 Q. Presumably you were seconded to tie, and presumably tie 13 must have been a client of your firm? 14 A. tie was a client of the firm. So were the Council. So 15 were Transport Scotland. 16 Q. Did you have any concerns that there might be negative 17 feedback from senior members of tie back to senior 18 members of your firm? 19 A. No, that honestly didn't cross my mind, to be honest. 20 I never really thought about that until you just said 21 it. 22 As I said, I think my own professional integrity, 23 and if I continue a relationship professionally with 24 these clients, I had to be seen to be advising them 25 credibly, whether I'm on secondment or not, and being 169 1 part of a team which includes your clients like tie, CEC 2 and Transport Scotland, I felt I had to retain that 3 position. And not just go along with what people were 4 saying because that was maybe the easier option or where 5 the team thought was best to go. 6 Q. Thank you. Just continuing with this, in the next 7 paragraph, paragraph 71, you say: 8 "Matthew Crosse took more of an interest in 9 procurement later on so I do not think I spoke to him 10 about the content of my email. I had heated discussions 11 with Geoff Gilbert throughout, but I do not remember if 12 I discussed the specific concerns in my email. Geoff 13 was running the procurement process and it very much 14 felt that it was his way or no way." 15 Finally, just the start of the next paragraph, 72: 16 "I felt that lip-service was paid to my concerns. 17 I never felt that they were addressed. I cannot 18 remember if what I said in that email was addressed. 19 With hindsight, I think there was an acceptance on my 20 part that Geoff was not going to do anything about what 21 I was saying." 22 Stop that there. And then one last email in that 23 regard, please. If we can go to CEC01791722. This is 24 an email from Matthew Crosse of 15 March 2007 to various 25 individuals in tie, including yourself, saying: 170 1 "Yesterday Trudi and I discussed priorities for her 2 new role in project strategy. This is an important 3 support function to the entire organisation. These are 4 the immediate tasks we have agreed for Trudi." 5 Now, to pause here, we know that David Crawley and 6 Tony Glazebrook had joined tie in about January or 7 perhaps February 2007 to job share the role of 8 essentially Engineering Director. Was that the reason 9 for a change in your role in tie, do you know? 10 A. Yes, I think it was. Yes. I think probably at that 11 point, there were processes in place for the consents 12 processes. The land, I think, had probably all been 13 acquired at that point in time. There was a TRO team. 14 So there was separate work streams all in place now for 15 the consents. 16 The design had evolved to a point where you really 17 are going to the next stage in the process, which is 18 getting to engineering and the construction elements. 19 Q. We can see that in the longer term, one of the first 20 bullet points: 21 "Supporting the negotiations with Infraco and 22 advising Geoff in our strategy/tactics to meet our deal 23 objectives." 24 Did you in fact end up fulfilling that role? 25 A. No, I didn't. I think I cover this in my statement, 171 1 actually. I can't think which paragraphs, but no, 2 I didn't. 3 Q. It may be thought from what you have said and what's 4 contained in your statement that there may be a certain 5 irony in giving you the role of advising Mr Gilbert in 6 the strategy and tactics, given that you seem to have 7 certain concerns with the approach that was being 8 adopted. 9 A. Yes, I think that's summed up by Matthew saying: please 10 provide Trudi with all the support she needs to fulfil 11 these tasks. I couldn't do it without others allowing 12 me to do it. 13 So when I -- looking back on this, when I was 14 producing my statement, I don't think I did any of these 15 things because people really didn't want me to get 16 involved in that way at that point in time. 17 Q. On the question of your statement, if we could please in 18 that regard go to page 107. This deals with this email, 19 and you say, about seven lines down: 20 "At that point in time, my role involved reacting to 21 requests that came to me for input in relation to, for 22 example, consents and approvals. It was very reactive 23 as opposed to doing/being allowed to do anything 24 strategic. That is because I was drifting away from the 25 project and also because people did not want me to get 172 1 involved. For example, Geoff Gilbert would never have 2 asked me to get involved in the Infraco negotiations ... 3 It may seem strange for the project director to 4 circulate an email around the team about my tasks and 5 for me not to then carry them out. My view was that 6 Matthew was trying to find a role for me but that my 7 involvement was less welcome by others in the team, and 8 therefore it was difficult to carry out these tasks as 9 I need co-operation from others. When I did give views 10 or advice, it was often unwelcome and so I became less 11 inclined to carry out these roles and, as I say above, 12 I drifted away from the project." 13 So it would be correct to say around the time of 14 this email in March 2007, were you no longer the 15 director of design, consents and approvals from around 16 this time? 17 A. Yes, probably around February/March time, yes. 18 Q. On the separate question of MUDFA, did you have any 19 responsibility for the MUDFA works or utilities design? 20 A. Not me personally. The land acquisition team, who were 21 led by Geoff Duke, he would report to me and he was 22 involved in getting the land rights to allow the MUDFA 23 contractor to go on to various land where they had to do 24 utility diversions. 25 From a design point of view, Alan Dolan, I think, 173 1 from SDS led that, and there was a MUDFA group which 2 comprised, I think, Alan Dolan, the MUDFA contract 3 manager and others who were managing that process more 4 in more detail, rather than myself. 5 Q. But did you have a general awareness of the state of 6 play of the MUDFA design and works? 7 A. Yes, a general awareness, yes. 8 Q. Could I then please take you to an email, TIE00000255. 9 It's an email from yourself dated 24 October 2006 to 10 Andie Harper. The subject is issues from CEC meeting. 11 It starts: 12 "Andie, you will have seen my email re MUDFA issues 13 which arose from my meeting with CEC yesterday. Here is 14 a note of the other issues." 15 It's simply the point, MUDFA: 16 "The Council said that we were "being mauled" by 17 MUDFA. We’re not managing the contract, we are not in 18 control, we are reactive, et cetera. I didn't put this 19 in my earlier MUDFA email, but you may want to raise it 20 with Susan." 21 I wasn't sure what you meant by: 22 "The Council said that we were "being mauled" by 23 MUDFA." 24 A. I think they felt that the MUDFA contractor had the 25 upper hand. They were dictating what we should be 174 1 doing, dictating how they were programming the works. 2 We were very reactive, and when we weren't getting the 3 rights and times, for example, if we didn't get 4 a licence in time for the MUDFA contractor to start, 5 which was tie's responsibility, if the MUDFA contractor 6 had mobilised, they were looking for us to meet costs 7 and things like that. 8 So I think there was a feeling from the Council that 9 perhaps MUDFA were taking advantage of the contract, but 10 we weren't managing that contract and fulfilling our 11 obligations under it. 12 Q. I think the MUDFA contract was signed in October 2006. 13 So if that's correct, this seems to be at a very early 14 stage of that contract these things are happening. 15 A. I think that's probably right, yes. It's probably maybe 16 indicative also of the state of the design as well. 17 Q. What do you mean by that comment? 18 A. At that stage we're still in the preliminary design 19 process, coming up to what I call PD2. And if you think 20 of the design as being iterative, and interconnected, 21 you can't do a utilities design in isolation, without 22 knowing where your track is going to go, where your 23 poles are going to go, where your equipment boxes are 24 going to go, where your tram stops are going to go, 25 because all of them have an impact on ultimately where 175 1 you're going to run your utilities, if you want to 2 minimise in future the risk of digging up utilities. 3 I think at this point there was perhaps a disconnect 4 between some of the drawings coming out from MUDFA, and 5 again, I think they were taking advantage of that 6 a little bit from CEC's perspective. 7 Q. Now, you mentioned before the question of PD2. I should 8 have asked you to explain that a little. What does PD2 9 mean? 10 A. Under the contract there was a concept of preliminary 11 design, and then detailed design, and because of what 12 had happened after the Preliminary Design was issued in 13 that there was no comments or sign off by tie within the 14 20-day period, and because of the extent of the issues 15 from the Council, and from tie, we introduced the 16 concept of PD2, Preliminary Design 2, which was meant to 17 be Preliminary Design 1 incorporating all the comments 18 that were received through the design approval process, 19 the charrettes, the planning summits which would then 20 form PD2 as the agreed baseline for then moving into the 21 detailed design stage. 22 Q. Thank you. Finally, in this email, you mention "you may 23 want to raise it with Susan". Is that a reference to 24 Susan Clark? 25 A. Yes, it is. 176 1 Q. Did Susan Clark have responsibilities in relation to 2 MUDFA at this stage? 3 A. Yes, she did. 4 Q. Thank you. 5 Sticking with MUDFA, the next document, please, is 6 CEC01815022. 7 Over to page 2, please, I'm sorry, if we can go back 8 to the very bottom of page 1 to see the date of this. 9 Go back to page 1, the very bottom, we see an email from 10 yourself dated 26 February 2007. Then please back to 11 page 2. We can see at the top it's sent to 12 Matthew Crosse and Susan Clark, subject MUDFA issues. 13 You say: 14 "I am becoming increasing concerned about MUDFA - it 15 may be that I'm out of the loop so apologies for butting 16 in if I am." 17 Then: 18 "I know that Graeme Barkley is joining tie. This 19 week? - however, if we are to start the trial works on 20 2 April, we need to ensure that the following is in 21 place." 22 Certain things are set out. 23 Now, if you are not primarily responsible for MUDFA, 24 why send this email? 25 A. Because of things that required to be in place to allow 177 1 MUDFA to do this trial pit, were the responsibilities of 2 my team, and they had raised concerns and therefore 3 I was raising them with Susan, who was managing the 4 MUDFA contract, to make sure we were in a position to do 5 what we wanted to do on 2 April, and that we'd met our 6 obligations as the employer. 7 Q. Then if we go back to page 1, please, and we can see 8 Susan Clark by email of 26 February 2007 says: 9 "Let me try to put your mind at rest." 10 And lists certain matters. Then you respond at the 11 top of the page: 12 "Thanks Susan - I just worry and the Council are also 13 raising concerns. But if it's all under control, that's 14 fine." 15 Were you -- was your mind put at rest by that 16 response? 17 A. No, it wasn't. 18 Q. Why not? 19 A. Then the context, this was the first time under the 20 MUDFA contract we are breaking ground, effectively. 21 It's the first trial pit. 22 If you look at the response from Susan in relation 23 to point 2, access rights, we are saying there: for the 24 trial we are looking to use BT powers. So immediately, 25 on the first trial pit, we are not following the right 178 1 process under the contract to get access rights. We are 2 relying on a third party's powers to do so. 3 So to me, we're almost -- we are not starting the 4 way we should be starting in the contract. We're 5 already know there's an issue and we are trying to find 6 a way to fix it. I'm not saying it's wrong to try and 7 find a way to fix an issue, but you want to start in a 8 good way when you are setting out the contract, not be 9 trying to retrofit solutions at this point in time. 10 Then in relation to point 3, advanced signage which 11 is in relation to the TTROs, we are saying it's not in 12 the MUDFA contract. 13 That's a big chunk of work which is outwith the 14 MUDFA contract, so needs to be priced and carried out by 15 someone. Again, we are almost behind the curve before 16 we are starting a process, and there's issues arising at 17 a point where we should be trying to do something about 18 it, not flippantly kind of saying we will use someone 19 else's powers, we have asked MUDFA to tell us what the 20 price might be and to cost it. It just felt we were 21 already setting off on the wrong foot. We are not in 22 control of the process. We are not on top of it. We 23 are not managing the contract very well at this point in 24 time. So the answer is whilst they may try to resolve 25 some of the issues, they don't show that we are in 179 1 control. 2 CHAIR OF THE INQUIRY: You are saying this was the first 3 trial pit that was being dug. Are you aware of whether 4 there was a full survey of the line, including the use 5 of ground radar and slit trenches and trial pits done to 6 get a better idea of what was underground before the 7 MUDFA contract was let? 8 A. There was definitely radar surveys done. 9 CHAIR OF THE INQUIRY: Of the full -- 10 A. I think of the full line. I think more than once 11 perhaps actually over the full line. I'm not sure if 12 I know that there was any trial pits or boreholes done. 13 But there was definitely surveys done. 14 MR MACKENZIE: Thank you. The next document, please, is 15 CEC01623417. Again, an email from yourself dated 16 12 April 2007 to Matthew Crosse and Geoff Gilbert, 17 headed "MUDFA worries", and you say: 18 "I worry that MUDFA and the advance works are 19 becoming out of control and we run the risk of being 20 exposed at the Tram Project Board." 21 Then third paragraph: 22 "The advance works at the depot and P&R - are 23 these a works order or a change to the contract? On 24 what basis has the cost been calculated? What are the 25 contract terms? Have we inadvertently misled the Tram 180 1 Project Board on previous occasions?" 2 What's the reference to the advance works at the 3 depot about? 4 A. It was basically digging the hole at the depot to put 5 the depot in. The depot is obviously sunk down, and so 6 you had to dig down, I think from memory, between 8 to 7 10 metres in the ground, which was a huge excavation in 8 itself. 9 So I suppose to save the Infraco a bit of time, it 10 was decided that those works would be done in advance of 11 the Infraco contract starting. 12 Q. When you say "they" were digging a hole, who was digging 13 a hole? 14 A. The intention was, I think this was done, it was the 15 MUDFA contractor who was awarded these advance works. 16 Q. Why were the MUDFA contractor digging a hole out at the 17 depot, rather than undertaking the utility diversion 18 works along the route? 19 A. Possibly because -- I can't totally remember. Possibly 20 because there was some delay to the MUDFA contract. 21 Possibly because to get them involved in advance works 22 as part of their work scope perhaps meant we didn't need 23 to procure it, which was a concern I had, that we should 24 have been procuring it separately. 25 I don't know if there was commercial pressure from 181 1 the MUDFA contractor, because we may -- have been delay 2 to give them further work. I don't know. It was just 3 suggested that they should be doing the advance works at 4 the depot, and that the park and ride -- which is what 5 the P&R refers to. 6 Q. Just for the avoidance of doubt, what was your concern 7 when you say "we run the risk of being exposed at the 8 Tram Project Board"; and when you asked the question, 9 "Have we inadvertently misled the Tram Project Board on 10 previous occasions?" what did these concerns relate to? 11 A. I think from memory, we perhaps hadn't been explicit in 12 the Tram Project Board that there were already issues 13 with the MUDFA contract. And there were commercial 14 issues outstanding at this point in time. I'm not sure 15 that had been conveyed to the Tram Project Board, 16 because my concern was on the one hand you've got 17 commercial issues or disputes with the contractor. Yet 18 you are giving them extra work packages to do. It 19 doesn't sit very well necessarily. 20 Q. I'm not sure if you're able to comment on this 21 suggestion or not, but it may be suggested in due course 22 at some point in the Inquiry that the reason the MUDFA 23 contractor was digging a big hole at the depot was 24 because tie weren't in a position to have the MUDFA 25 contractor start the utility diversion construction 182 1 works, and this was a way to prevent or reduce claims by 2 the MUDFA contractor. 3 Now, if that were to be suggested in due course, do 4 you have any comments on that? 5 A. It wouldn't surprise me this if that was the case, but 6 I think that -- if that was the case, that should have 7 been made very clear to the Tram Project Board. 8 Q. Thank you. 9 Back to your statement, please, at page 34. This is 10 just to finish off another couple of points in relation 11 to MUDFA. 12 In paragraph 82 you said: 13 "The SDS outputs did not seem to tie in with the 14 requirements and timing of the MUDFA contract. As 15 I said previously, it was difficult to progress and 16 finalise distinct elements of the design eg the utility 17 drawings as all of the elements were all so linked." 18 I think you have made that point today as well? 19 A. Yes, I have. 20 Q. The last point under MUDFA, if I may, please, at page 21 51, in paragraph 123, you say: 22 "In my view, the completion of work under MUDFA 23 totally depended on design work under the SDS contract. 24 SDS were designing all of the utility diversions." 25 A few sentences down: 183 1 "It was difficult for SDS, because it was not always 2 practicable to design the utility diversions ahead of 3 the rest of the tram design but the designs were 4 required in advance of other elements of the design to 5 allow the MUDFA contractor to start and complete the 6 utility diversion works ahead of Infraco starting. This 7 resulted in SDS having at times to do several iterations 8 of the utilities design. I note that the original 9 programme anticipated that the preliminary design would 10 be completed before the MUDFA contract was awarded which 11 would have made sense." 12 But as you have explained, I think, here, if the 13 MUDFA contract was awarded in October 2006, we've 14 discussed how preliminary design was not complete at 15 that stage? 16 A. Yes, that's correct. 17 Q. Thank you. 18 We can leave MUDFA. I simply have a few final 19 questions in relation to management and governance 20 issues. 21 I think we can deal with them by going to various 22 parts of your statement. If we could start, please, at 23 page 74. 24 These first comments are in relation to points made 25 by other individuals as part of Mr Crawley's review. 184 1 You comment on them as follows. So in paragraph 195, 2 I think somebody had commented that tie were 3 under-resourced. You said: 4 "I would say that they were under-resourced in the 5 design team." 6 You go on: 7 "However, people could have been more effective if 8 the organisation had been better structured/managed and 9 if people had worked more efficiently. The way it 10 worked in tie was similar to little kids playing 11 football and all going for the ball irrespective of 12 their position. In tie everyone would be round an issue 13 when it came up, even although there were another ten or 14 so issues, for example, which required similar urgent 15 attention." 16 Just for the avoidance of doubt, does that comment 17 relate to -- which period does that comment relate to? 18 A. Probably throughout my secondment. 19 Q. Then, please, page 77. In paragraph 203, in the second 20 line, you say: 21 "The project directors who came in [to tie] seemed 22 to have sufficient experience of running a big project. 23 I think, however, that most of tie had not been involved 24 in actually delivering a big project ... It would have 25 been a better organisation if there had been more people 185 1 with that experience, as that could have dovetailed with 2 the technical experience of TSS." 3 Then you go on to make the issue -- mention the 4 issue of the lack of clarity as to what people were 5 doing. And also the lack of consistent leadership may 6 also have been a factor. 7 Then, please, at page 78, again dealing with the 8 management issues, in paragraph 208, you say: 9 "Tie thought that they were an informed client, but 10 I think that they did not really know how to manage 11 contracts. I think Jim also felt that they were not 12 willing to take on the benefit of others experience and 13 knowledge to become an informed client." 14 Page 82, I would like to ask you about something you 15 mentioned in paragraph 229, when you say: 16 "There seemed to be a lot of people working in tie, 17 but I'm not sure what each individual contributed. 18 There might have been fewer people, or slightly 19 different people (in terms of expertise), if they had 20 taken a top down approach focused on specific 21 skills/expertise rather than from the perspective of 22 finding roles for people already employed in tie." 23 I wasn't sure what you meant by that comment of 24 rather than from a perspective of finding roles for 25 people already employed in tie. Can you explain that 186 1 a little? 2 A. What I think I meant there was during the lifespan of 3 the tram project, there are other projects that tie were 4 involved in which came to an end. So, for example, the 5 Edinburgh Airport rail link. Stirling-Alloa-Kincardine 6 rail link. The people then employed on those projects 7 were subsumed into the tram team, but it was not -- not 8 always obvious that there was a gap that they could 9 fill, or they had a skill set that was required on the 10 tram project. Or it was just we had a body, therefore 11 give them some kind of role in the tram project. 12 Q. Thank you. Then three final passages in your statement, 13 if I may. 14 At page 105, please, going back to the question of 15 programme at page 105, in paragraph 292, you say: 16 "The management culture in tie was that programme 17 was king and had to be adhered to even if it was 18 unrealistic or unachievable. The team reported that the 19 project was on programme. However, milestones either 20 came and went or were not properly completed; but the 21 procurement dates did not seem to reflect that. Those 22 in charge of the programme did not want to hear about 23 issues which could put the programme at risk. That 24 meant that a large number of issues were swept under the 25 carpet and became bigger issues at more critical points. 187 1 My feeling was that people had a good handle in the 2 early stages about what the cost was going to be. 3 I think, however, that there was not such a good 4 understanding of the hidden costs that would flow from 5 changes." 6 Is that what you set out in the last two sentences, 7 is that a view you held at the time or subsequently with 8 the benefit of hindsight? 9 A. I think I always had a concern that there were going to 10 be hidden costs because certain elements weren't 11 developed enough. Probably with hindsight I have 12 reinforced that view. But I still think I had that view 13 at the time. 14 Q. Just for the avoidance of doubt, when you say "those in 15 charge of the programme did not want to hear about 16 issues which could put the programme at risk", who were 17 those individuals? 18 A. I would say it was Susan Clark, Geoff Gilbert in the 19 context of procurement, and ultimately the project 20 director at the time. 21 Q. Thank you. Then at page 108, please. In paragraph 303 22 I'll try not to read all of this out. It's quite a long 23 paragraph. It goes into the next page, but essentially 24 you start off by saying: 25 "I cannot remember precisely when I stopped going to 188 1 the DPD subcommittee meetings. I think it was around 2 March/April 2007 ... I said that matters were not being 3 fully reported because it felt to me that there was 4 a positive spin put on what was being reported. That 5 was the case across the board. It felt a bit 6 disingenuous. Generally, people were presenting their 7 papers with a positive slant on matters. For example, 8 Susan Clark reported on the programme. On one level it 9 was right to say that SDS were on programme; however, 10 I have explained the problem with the SDS programme 11 before, and to simply say that it was on programme was 12 not really giving the full picture." 13 Over the page, please, you say: 14 "There must have been a collective feeling 15 (consciously or unconsciously) that that was the way to 16 present matters. Looking back, I think it was 17 intentional, but not in a bad way - it was intentional 18 that people wanted to report positively ..." 19 Then I should perhaps also take you to what's said 20 in paragraph 304. You say: 21 "I cannot remember exactly what I raised at the 22 meeting ..." 23 Is this a meeting of the DPD? 24 A. Yes, it was. 25 Q. "... after which Willie Gallagher shouted at me. 189 1 I think I raised the concerns around what was happening 2 with the MUDFA contractor being given the advanced work 3 packages ..." 4 Can you just please describe in your own words what 5 happened at this meeting and afterwards? 6 A. Okay. We were all at the meeting. And it's in my 7 statement, but the meeting, there was obviously -- 8 Willie Gallagher, I think, chaired it at that time. 9 There were representatives from CEC, Transport Scotland, 10 Lothian Buses, SDS, I think, had a representative there. 11 And there were various people from tie that -- kind of 12 the senior management team in tie came along to the 13 meeting to report on the various issues. 14 From memory, I think the first issue on the agenda 15 was programme. And as I have said there, there was 16 a positive slant. I felt that we were on programme. 17 That was the message we were given. 18 I think in the context of that reporting, I made the 19 comment or perhaps pointed to parts of the programme 20 which maybe weren't on track at that point in time. 21 Immediately from the body language, I knew that 22 wasn't well received by Willie Gallagher. Then I'm 23 pretty sure the second thing on the agenda was the 24 advance works packages, and some of the concerns I put 25 in my email, I raised in the context of the DPD, because 190 1 I felt it was only fair to raise those concerns because 2 they were concerns that I still had, and it was things 3 about should we procure it, why are we giving them 4 advance works packages, and again, as I have raised the 5 comments, I could tell that that wasn't well received. 6 Then after every agenda item, Willie Gallagher asked 7 me quite sarcastically at the end of the presentation 8 and the questioning, whether I had anything else 9 I wanted to say or raise, and often I did, and I did 10 raise it, but the meeting did become more and more 11 uncomfortable. 12 I left the meeting and was followed out by the 13 representative from Lothian Buses, the Council and 14 Transport Scotland, who made the comment about although 15 I was a girl, I was the only one who had balls in the 16 room to raise some of the comments that I'd raised. 17 I then went back across to CityPoint, tie's offices and 18 Willie Gallagher took me away from my desk and told me 19 never again to do that in a meeting, which is why 20 I chose not to attend the future meetings, because 21 I didn't think it was right to not raise concerns that 22 I had in that forum. 23 Q. You say in your statement you mentioned Mr Gallagher 24 shouting. Was this the occasion on which he shouted at 25 you? 191 1 A. Yes, he did. 2 Q. Standing back a little, would it be fair to say that you 3 didn't feel that constructive criticism was welcome 4 within tie? 5 A. Yes, I think that's fair. I think they maybe felt I was 6 breaking rank. I think they wanted to convey the 7 impression that everything was fine on the project. 8 Now, I can understand that to a certain extent. But if 9 I was a funder or a stakeholder on this project, this 10 project was so big, it's such a difficult project, that 11 actually I would be more concerned that there weren't 12 issues. 13 Because something must be happening in a project 14 this scale that is a problem or concern or needs to be 15 addressed. It was huge. It was a huge project. But 16 I can understand why they want to convey to these 17 parties that they were in control, that it was going 18 well and they were managing it well. But I didn't think 19 I could be party to that in my role. 20 Q. Trying for a moment to put the tram project to one side, 21 we can see from your CV that you are a board member of 22 various bodies, including on the board of management and 23 auditor risk committee. Putting the tram project to one 24 side, what can bodies or organisations do to create an 25 avenue for people working within a project who may have 192 1 concerns about it to ensure any serious concerns can 2 find their way to, for example, people sitting on 3 a board? 4 A. Well, some organisations that I'm a board member of have 5 whistleblowing policies, which might encompass that. 6 Personally, I think it's a cultural thing. The 7 culture in an organisation has to be one that allows 8 people to feel they can raise issues, and there's not 9 going to be a blame culture. There's not going to be 10 finger pointing. And there wasn't that culture within 11 tie. It's a difficult one because going to that -- 12 going to a board, you want your board to think positive 13 of the organisation they are the board for. But I think 14 of the board -- I know on a couple of boards I'm on, we 15 often have presentations from staff on tricky issues, 16 because we are there to try and help them and try and 17 find a solution. It's not a criticism of them if there 18 are things that are issues. But to be a board -- to 19 effectively discharge your role as a trustee, you need 20 to understand what the issues are, and give people 21 confidence to raise them. 22 Q. Presumably, if one is to create a culture within an 23 organisation where employees feel they can raise issues 24 and that there's not going to be a blame culture, that 25 must be a matter of leadership from the very top; is 193 1 that fair? 2 A. That is fair, yes. 3 Q. Now, finally, one last document, very briefly, if I may. 4 It's CEC02084810. 5 This, I think, is a lessons learnt paper you 6 produced in June 2008 to Mr Duncan Fraser of the 7 Council. I think the context is what could have been 8 done differently in relation to tram line 3, were that to 9 have been built. 10 If I can go, please, to page 3, under "Engagement", 11 you say: 12 "There should have been greater engagement with the 13 Council and key stakeholders from the outset." 14 You have discussed that in your evidence. You then 15 go on to say: 16 "In our view ..." 17 When you say "in our view", is this really your 18 view? 19 A. Yes. I probably signed the paper as Dundas & Wilson, as 20 opposed to me personally, which is why it's our view, 21 a collective firm view. But yes, I drafted the note. 22 So yes, it was my view. 23 Q. You explain: 24 "In our view this lack of engagement may have cost 25 the project 9 - 12 months during the design 194 1 stage ..." 2 Just finally, one last matter I should clarify with 3 you in the next and last bullet point. Under 4 "Programme", you said: 5 "This needs to be realistic and not based on bonuses 6 if milestones are reached." 7 What was the basis for you saying that? 8 A. There were various rumours on certain milestones being 9 reached on the project, certain bonuses had been paid to 10 members of the project team. So for example I think 11 there was a rumour that the bills had to be in 12 Parliament by December 2013 before Christmas, and if 13 that was achieved, bonuses would be paid to the project 14 team dealing with the bills at that point in time. 15 My understanding, from what I'd heard, again 16 rumours, was that the bonuses would be paid on signing 17 the Infraco contract on a certain date, and I just felt 18 that if you tie achieving key milestones like that to 19 bonuses, you may drive the wrong behaviours and may end 20 up signing a contract kind of at all costs at that point 21 in time, in order to achieve bonuses. 22 I think bonuses are awarded on an overall 23 performance basis, based on objectives and outcomes, not 24 just on milestones on a project. 25 MR MACKENZIE: Thank you. I have no further questions. 195 1 CHAIR OF THE INQUIRY: I don't think anyone else has. 2 Thank you very much, Ms Craggs. You're free to go 3 now. You're still under your citation, in case we need 4 to recall you, but hopefully that won't be necessary? 5 A. Thank you, my Lord. 6 CHAIR OF THE INQUIRY: We will adjourn until Tuesday at 7 9.30. 8 (4.22 pm) 9 (The hearing adjourned until Tuesday, 10 October 2017 at 10 9.30 am) 11 196 1 INDEX 2 PAGE 3 MR JIM HARRIES (continued) ...........................1 4 5 Examination by MR MACKENZIE (continued) .......1 6 7 Questions by CHAIR OF THE INQUIRY ............44 8 9 Examination by MR DUNLOP QC ..................46 10 11 MR ALEXANDER MACAULAY ..............................48 12 13 Examination by MR MACKENZIE ..................48 14 15 MS TRUDI CRAGGS (affirmed) ..........................93 16 17 Examination by MR MACKENZIE ..................93 18 19 20 21 22 23 24 25 197