1 Tuesday, 7 November 2017 2 (9.30 am) 3 CHAIR OF THE INQUIRY: Good morning. Yes, Mr Lake? 4 MR LAKE: My Lord, the first witness today is 5 Graeme Barclay. 6 MR GRAEME BARCLAY (sworn) 7 CHAIR OF THE INQUIRY: You are going to be asked some 8 questions by, first of all, Counsel to the Inquiry, 9 Mr Lake. 10 If you just listen to the question and answer it as 11 directly as possible. If you speak clearly and at 12 a measured pace so the shorthand writers can keep up 13 with you, and speak into the microphone so people in the 14 hall can hear you. All right? 15 A. Yes. 16 Examination by MR LAKE 17 MR LAKE: Mr Barclay, could you state your full name, 18 please. 19 A. Graeme Allan Barclay. 20 Q. The Inquiry has details of your address. I think you 21 were the Construction Director for Utilities of tie 22 between March 2007 -- when was it you left? 23 A. I think it was end of April 2010. 24 Q. I would like you to look at a document with me, please. 25 It's reference TRI00000024_C. That will be shown on the 1 1 screen to your right, and hopefully you've got a paper 2 copy in front of you as well? 3 A. Yes. 4 Q. Is that a copy of the statement that you provided to the 5 Inquiry? 6 A. It appears to be, yes. 7 Q. If you look at the paper copy. You will see that you 8 signed that on the last page. 9 A. Yes. 10 Q. Are you content that that be adopted as your evidence 11 for the purposes of this Inquiry? 12 A. Yes. 13 Q. I would just like to ask you a few questions about 14 clarification, expanding upon what's in your statement. 15 Going back first to when you arrived in March 2007, 16 what problems did you consider existed in the MUDFA team 17 when you arrived in 2007? 18 A. I think when I first arrived with the actual MUDFA team 19 itself, it appeared to be slightly dysfunctional in 20 terms of the roles and responsibilities of the 21 individuals within that team seemed to be unclear, and 22 communications was not clear and the line of 23 communications was not clear. 24 Q. On what was that resulting? What was that producing? 25 A. It was producing -- there was an ineffective team. They 2 1 were unable to manage the contract effectively because 2 they didn't -- it wasn't really clear as to who was 3 doing what. 4 Q. In what way was the contract not being managed 5 effectively? 6 A. I think in terms of the people who were in the team, in 7 terms of their experience, in terms of contract 8 administration, I would say it was lacking. 9 Q. So what was happening or not happening in terms of 10 actually administering the MUDFA contract? 11 A. I think in terms of managing the programme, they were 12 there to actually manage the project on behalf of the 13 client, and ensure that the programme was being 14 effectively led and they were managing the contractor at 15 the same time. In terms of that, I don't think that was 16 actually happening. 17 Q. Not managing the contractor or the programme? 18 A. Both. 19 Q. What did you do about that when you arrived? 20 A. I think in terms of -- you find -- when you find 21 a dysfunctional team, in most cases it's because the 22 roles and responsibilities haven't been clearly defined. 23 So the first thing I did was interview each individual 24 within that team to try and find out what their role 25 was, what they thought their responsibility was, and how 3 1 the reporting line within the structure operated. And 2 it was very, very clear after about a week that the 3 roles and responsibilities weren't clearly defined 4 within the team itself and the structure itself. 5 Q. Just trying to understand how that had an effect on the 6 implementation of the contract, and correct me if I am 7 wrong, was the problem then that there were things that 8 needed to be done, that nobody was doing because 9 everybody thought someone else might be doing that. 10 A. I think that in essence was the problem. I can't 11 pinpoint exactly where all the problems were, but if 12 you've got a dysfunctional team, as you say, some people 13 think others are carrying out that task when in fact 14 they are not, and then the line of communication is not 15 clear, so you get mixed messages. So therefore there's 16 not a clear strategy or guidance coming out from the 17 team. 18 Q. The MUDFA team, they would be dealing with the 19 contractor that had been appointed. 20 A. Yes. 21 Q. You say they were managing programme. Was that an 22 internal aspect? 23 A. That was the MUDFA programme. 24 Q. What about dealing with the SDS, the provision of 25 design -- 4 1 A. I think in -- when I arrived, Jim Johnson was the 2 design -- sorry, the design manager at the time. 3 Q. Was that -- 4 A. And I think his role was to actually liaise with SDS in 5 terms of aligning the design release to the programme 6 requirements. So I think that was the initial part of 7 it, but I don't think that was working properly at the 8 time. 9 Q. So that was another aspect where you don't feel -- 10 A. Yes. 11 Q. What was the problem there? Was that again a matter of 12 roles and responsibilities or were there different 13 issues? 14 A. I think it was in terms of the guidance. I think the 15 team has to be led, has to be guided and I think there 16 was a lack of that. There was no one actually taking 17 ownership of the actual project and making sure that 18 they were functioning as a team. 19 Q. The MUDFA contract itself was available to the Inquiry, 20 and I don't intend looking through that. It's apparent 21 from reading it that it's quite complex in terms of 22 deciding which work sections are done bit by bit, and 23 that requires quite a bit of work on tie's part to 24 direct the contractors to various sections; is that 25 correct? 5 1 A. Correct. 2 Q. And also to ensure things like the various consents and 3 permissions are available for that section. 4 A. Yes. 5 Q. Was that the sort of thing that was -- there were 6 difficulties having administered? 7 A. I think that was -- I haven't really got into that part 8 of the programme yet because we hadn't started 9 construction works. 10 Q. So in relation to what sort of things were the 11 difficulties arising when you arrived in March 2007? 12 A. I think the difficulties were the relationship between 13 the MUDFA team and the contractor, and the actual 14 aligning the programme in trying to drive the design 15 such that it would allow the programme to commence when 16 it was planned. 17 Q. Just looking for the moment then at the relationship 18 between the tie team and the contractor, the MUDFA 19 contractor team, what was happening or not happening in 20 that relationship? 21 A. There was a clear breakdown between the MUDFA team and 22 the contractors in terms of there was a lack of guidance 23 and direction, and leadership from the MUDFA team, and 24 they were reliant upon the contractor to drive and 25 administer the contract. And drive the programme 6 1 forward. 2 Q. What was happening? 3 A. It wasn't working well. 4 Q. Was the contract moving forward? 5 A. The contract was moving forward. I can't really comment 6 on before I arrived there. The contract was moving 7 forward, but if it was moving forward as effectively as 8 it should, I would say no. 9 Q. You refer in your statement to the fact that the 10 contractors, who were Alfred McAlpine at that time, 11 took advantage of the inexperience of the tie people? 12 A. Yes. 13 Q. What were you meaning by that? 14 A. The contractor was in my opinion was taking advantage of 15 the fact there was an inexperienced team in terms of 16 contract administration, and they were manipulating the 17 works to suit themselves. 18 Q. Can you give me an example of what you mean by that, how 19 they were manipulating the works? 20 A. Well, they were identifying areas where they would 21 prefer to work, and they were trying to drive the 22 programme such that they were pushing it to the point 23 in -- where we weren't quite ready to start, but they 24 were wanting to start there, they would give the 25 impression they were wanting to start, they were ready 7 1 to start, and they were then stating that they were in 2 delay. 3 Q. Why would they be in delay? 4 A. Because they were stating they wanted to start, but we 5 couldn't start because the design wasn't ready. 6 Q. So that was an issue simply who was dictating where the 7 work should be taking place? 8 A. At that point in time, yes. 9 Q. Did that matter get resolved? 10 A. Eventually it got resolved, once we got the team 11 restructured, realigned, and then we started 12 administering the contract properly, then we started 13 dealing with the contractor in a more professional 14 manner, yes, it did get realigned. 15 Q. Because in terms of the contract, again, to paraphrase 16 it, the idea was that tie would dictate which section 17 work should be done on bit by bit? 18 A. tie would be the ones that would lead and decide which 19 section it would be preferred to start at, not so much a 20 dictate, but more of an effective way of managing the 21 programme and identifying the sections that would allow 22 the programme to be released as early as possible, and 23 taking account of the critical path within the programme 24 as well. 25 Q. Can you recall when tie were able to take control of 8 1 that or got control of that back? 2 A. I think it took about -- I arrived about March, tail 3 end, mid-March, I think it took maybe four or five 4 months before that. I was comfortable with the 5 situation. 6 Q. During that period of four or five months, say that's 7 taking us up to about July/August 2007, after your 8 arrival, what effect was that having on the progress of 9 the MUDFA works? 10 A. Well, in terms of the progress, if you remember that 11 time round about May, we were going through the 12 elections and Labour were the ruling party at the time, 13 and they were pro-tram. SNP were quite audible in terms 14 of they were anti-tram, and we were unable to commence 15 any works at all until the elections had been carried 16 out, because we were concerned in terms of what would be 17 the outcome from the elections, and it may inadvertently 18 actually terminate the project. 19 So we weren't in a position to actually start until 20 after the elections had taken place. I think from 21 memory it was round about July when we did the first 22 section. 23 Q. I want to come back to ask you a few questions about 24 that in due course. 25 First of all, what I would like to look at is the 9 1 interrelationship that was planned between the MUDFA 2 works on the one hand and the Infraco works on the 3 other. I think you say in your statement that it was 4 envisaged that these works would largely be taking place 5 at the same time, and they would have to accommodate one 6 another by the time you got there? 7 A. I think the initial one was -- it was -- you were on 8 a period of time when MUDFA was going to be commencing 9 earlier, I think, from memory, it was going to be about 10 eight or nine months in advance of the Infraco starting. 11 Then there was going to be a period after that when 12 Infraco commenced works, where we would have a leading 13 anyway of nine months. So we would be ahead of them 14 diverting utilities in advance of the Infraco 15 construction. So there was going to be a period after 16 about nine months where Infraco and MUDFA would be 17 operating at the same time, but not in the same areas. 18 Q. That's what I want to be clear. Although both would be 19 working, they wouldn't be working in the same sections? 20 A. No, they couldn't work in the same sections. 21 Q. Did you manage to maintain that intention that MUDFA 22 would essentially work ahead of Infraco? 23 A. I think the intent was there in terms of us maintaining 24 ahead of Infraco in certain sections. We were able to 25 do that. Unfortunately, I didn't have sight of the 10 1 Infraco programme, and that seemed to change quite 2 a lot, and the initial programme where we were dealing 3 with the diversion of utilities, the sections we were 4 working in, we were under the impression that Infraco 5 would be moving into that section thereafter, but the 6 programme was changing within Infraco, and some sections 7 were coming forward in advance of our works. 8 So I think the intent was there, as I said, but 9 because of the change in programmes, in some cases we 10 were not able to keep ahead of Infraco. 11 Q. The programme that was changing, was that the Infraco 12 programme rather than the MUDFA programme? 13 A. Yes. 14 Q. What happened if that situation arose where a particular 15 part of the Infraco works were accelerated? 16 A. I think ultimately in the end it was those sections that 17 we transferred over to Infraco because we were not able 18 to get in to carry out the works, and you don't have two 19 principal contractors working in the same area. So 20 you've got to nominate the contractor. So it was deemed 21 it was in certain sections where Infraco were wanting to 22 get in early, then it was deemed there appropriate to 23 transfer the utility diversions over to them. 24 Q. Did that work well? 25 A. I think it worked reasonably well. 11 1 Q. If it worked well to have the Infraco contractor doing 2 utility diversions there, as part of the Infraco works, 3 does that provide an example of how things could be done 4 rather more smoothly in future, if you tie the two 5 together? 6 A. It could. But you've then got to look if you put all 7 your eggs in one basket, if something goes wrong with 8 that contractor, you've not only got issues with the 9 utility diversions, you have issues with the civil works 10 following on from it. And the other aspect of it is 11 because utility diversion, these are quite specific and 12 a different type of work, environment, to civils 13 environment, you've got to look at the competency and 14 experience of the contractors. Not all contractors have 15 the global experience to carry out utility diversions 16 and then carry on the main civils element thereafter. 17 Q. But it seemed to work in relation to those areas where 18 the two bits of work -- 19 A. It seemed to work, yes. 20 Q. It would be open, for example, for the infrastructure 21 contractor either to have a consortium partner or 22 a subcontractor able to do the utilities works? 23 A. Yes. 24 Q. In the situations where sections of the utility works 25 were brought forward, and it meant MUDFA works were 12 1 struggling, was there ever pressure on you and the MUDFA 2 contractor to try and accelerate those parts of the 3 MUDFA works to get them done? 4 A. There was always a pressure on us to accelerate the 5 works. 6 Q. Were you ever required actually to accelerate works? 7 A. Sorry? 8 Q. Were you ever actually required to accelerate works in 9 order to enable infrastructure -- 10 A. I don't recall any sections where we were required to 11 accelerate, other than just the global -- we wanted to 12 accelerate the general programme in itself. But there 13 was no specific section that comes to mind where we were 14 asked to specifically accelerate to get the section 15 closed off. 16 Q. Okay. Looking now at some of the relationships with the 17 statutory utility companies, and it might be easier just 18 to refer you to a passage in your statement here, if we 19 could look at page 75 of your statement, paragraph 239. 20 A. Yes. 21 Q. You note here: 22 "The utility work undertaken was carried out under 23 statutory authority and there was entitlement under the 24 NRSWA (New Roads and Street Works Act) to recover monies. 25 Agreements were necessary with the SUCs ..." 13 1 That's statutory utility companies: 2 "... as they were the authorised parties. We 3 required agreements to commence the diversion of 4 utilities, as there was an obvious impact on the SUCs." 5 Just pausing there, the impact on the SUCs is quite 6 obvious because you're going to be moving their 7 apparatus? 8 A. Yes. 9 Q. In relation to utilities, perhaps particularly gas, you 10 can see there would be safety issues that they would 11 need to be satisfied as to the work that was being done 12 and the quality afterwards? 13 A. Yes. 14 Q. When you say we required agreements to commence the 15 diversions of utilities, was it not possible simply to 16 rely on either the statutory powers under the Tram Acts, 17 or some powers under the New Roads and Street Works Act? 18 A. Yes, you could say that, but bear in mind we were -- 19 this was a -- quite a significant project, and I think 20 it was one of the first type ever to be carried out. 21 What you're trying to do, you're trying to get parties 22 to work with you, as opposed to you dictating that we 23 will move them. So the whole premise of the project was 24 to build up relationships with SUCs and work together 25 with them, because you are not just dealing with one 14 1 utility. You're dealing with approximately -- I think 2 it was 18 at the time. And the best way forwards is 3 you're working together with them, and that was the 4 idea, we went down there, so we started building up 5 relationships with the SUCs. They understood the 6 requirements. They understood why we were moving the 7 utilities. And so therefore, as we progressed with 8 them, we build up relationships with them, and actually 9 it made for an easier -- what you call -- work, was 10 easier to work with them. When you have someone that's 11 working with you, it's easier to actually carry out the 12 works, as opposed to someone that you're actually 13 dictating that you are going to be doing this. 14 Q. I see that. Did the need to get agreement to the 15 utilities result in delay; were there difficulties 16 getting that agreement? 17 A. I don't think so. I think in the initial onset, when we 18 were trying to build up relationships with them, and 19 make them understand the complexity of what we were 20 trying to do in terms of the processes we were going 21 through, I think ultimately we did achieve a good 22 process with all the utilities in terms of going through 23 the -- the stages of getting it approved. Once they 24 realised that we were actually trying to provide them 25 with a good service and an end product that would 15 1 satisfy their requirements, I think it made for a better 2 working relationship and we did progress. 3 I don't recall any real big issues with the utility 4 companies, other than the initial stages we had initial 5 delays in just building up relationships with them. 6 Q. What did you do? If you had to try and get up to -- if 7 you had 18 companies involved, you had to get 18 8 separate agreements? 9 A. Yes. 10 Q. For particular diversions to be carried out in 11 a location? 12 A. Yes. 13 Q. What did you do to get those? 14 A. Initially, I set up the team because when I went there, 15 there wasn't any sort of like -- what I saw was a link 16 between the MUDFA team and the utility companies. So 17 I brought in some senior personnel to start taking 18 ownership of dealing with specific utilities. 19 I subdivided that down to some of the project 20 managers. So we had specific contacts with each 21 utility. So therefore you build up a relationship with 22 them. And then in terms of the design, we brought all 23 the parties together, and I think the early, early 24 stages, we started having workshops with them, to 25 explain how we were going to go through the process of 16 1 agreeing the actual locations of the utilities when it 2 came to like multiple utilities. 3 And so we explained how the processes, what we were 4 going to be doing, how we were going to do it, how we 5 were looking for their support on this. Once they 6 understood the process and the manner in which we were 7 going to approach it, it kind of helped us to progress 8 the works and get approvals for these designs for 9 utilities. 10 Q. So to understand, you brought representatives from all 11 the affected utilities in any one area together, 12 essentially brainstorming solutions? 13 A. That was for initially for a couple of workshops, just 14 to let them understand the processes, what we were going 15 to be doing and how we were going to go through the 16 project life cycle. Thereafter we dealt with the 17 utility companies independently there. 18 Q. Taking a particular location, say there is a busy 19 junction where you might have five, six different 20 utilities to consider at once, what was done to get the 21 agreement of each of them, to the proposed new design? 22 Did you have to go round one, get agreement, and then to 23 the next, and then did one of them propose change, just 24 keep going round? 25 A. It's an iterative process. You've got to -- you've got 17 1 to look at -- there are certain requirements for the 2 utilities in terms of separation, cover, some utilities 3 are actually a lot deeper. So therefore your conflict 4 is there. So you generally look at the utility that is 5 going to be deepest. So you get that position first and 6 then you work your way up towards the surface, because 7 there are different coverage requirements for each 8 utility. You do get areas where you have got conflict, 9 and when that happens, you've got to actually look at 10 the design, and see which is the most beneficial design 11 and proposal, and then you have got to then discuss that 12 with the respective utility companies, and explain why 13 you've chosen that location for their utility, as 14 opposed to maybe a preferred location. 15 Q. But if the last utility you have spoken to there objects 16 to what is there, and things have to be changed to suit 17 them, that means you have got to go back to square 18 one -- 19 A. No, ultimately you come to the point where you say 20 that's -- there was a couple of occasions where we had 21 to -- sorry, just impose and say: we can't move it any 22 further, this is a -- this is the only place we can move 23 your utility and you are just going to have to accept 24 that. There were only a couple of occasions where that 25 happened. 18 1 Q. If the situation was that ultimately a solution could be 2 or would be imposed, would there have been scope for 3 trying to do that earlier, to save time and get to 4 agreement more quickly? 5 A. Could you repeat the question. 6 Q. Instead of trying to reach agreement for a long time and 7 then imposing a solution, as you said, could you not 8 have imposed a solution at the outset and saved a lot of 9 time? 10 A. I think by the time when we got a respective design 11 complete and we came to that point in time, that was the 12 earliest point in time when we were able to actually 13 identify the location of that utility. And we wouldn't 14 debate over it for too long in terms of stating this is 15 the only location for that utility. There's an 16 alternative. So that debate didn't last long. So it 17 wasn't a case of protracted correspondence on the 18 matter. It was: this is the location for that utility 19 at this point in time. There's no other location. 20 That's where it's going. 21 Q. To what extent did the desire to try and accommodate the 22 preferences of each utility result in delay to agreement 23 of design? 24 A. I don't think there was any desire to accommodate them 25 specifically because of the very nature of the space we 19 1 had available. If you look at the -- take example of 2 just a typical street, the reason why you've got 3 utilities in the middle of the road is because that is 4 the only place where they can go. 5 So we were actually diverting all the utilities from 6 the middle of the road and put them outside, where 7 you've got -- obviously there's very limited space. 8 So therefore, in terms of giving the utility 9 companies exactly what they wanted, it wasn't there. 10 It wasn't there in the first place. So therefore 11 they would have to accommodate us in terms of their 12 standards were going to be reduced, because we just 13 didn't have the space available. 14 Q. In terms of the procedures that you used to get the 15 utilities signed up to the proposals, were they any 16 different on this project than they would be on other 17 projects, similar projects? 18 A. Well, I don't think there was any difference. The only 19 thing is that we went through a series of iterations 20 because of the multiple utilities we were dealing with 21 and the conflicts we had. 22 CHAIR OF THE INQUIRY: Did that cause any difficulty, the 23 various iterations, did that involve a change in design? 24 A. In some cases it did involve minor changes or 25 re-routed -- in most cases it was just ultimately get 20 1 approval from all the various utility companies. 2 CHAIR OF THE INQUIRY: It didn't cause any difficulty if you 3 ended up changing your design and somebody had approved 4 the initial design, and then because of other 5 iterations, you had to change it? 6 A. No, we tried -- we avoided -- where we were getting down 7 to various approvals, it was only the one utility 8 company or something like that. You basically went 9 back, as we said, down to the point where you've got no 10 alternative. That's the location for your utility, and 11 it will be going there. 12 MR LAKE: Did they accept that? 13 A. Yes. 14 Q. Was there a hierarchy of utilities in the sense that 15 some, such as gas, electricity and perhaps water, just 16 had to be accommodated for the safety reasons for 17 theirs, whereas others were accorded less priority? 18 A. I think in terms of the gas, the only priority we put on 19 the gas was because obviously the health and safety. So 20 we would be very, very cognisant of the requirements for 21 the gas assets. 22 Similarly for the Scottish Power and the SSE assets, 23 obviously the health and safety issues surrounding them. 24 Other than that, not really, no. 25 Q. Could we look at the next page of your statement, 21 1 please, page 76. Enlarge paragraph 242. This is again 2 still looking at this question of agreements that had to 3 be in place for the statutory utility companies. 4 You say: 5 "Some of the SUCs required ..." 6 The third line: 7 "Some of the SUCs required CEC to be a party to the 8 utility diversion agreements as well as TIE." 9 Why was that? What difference did it make to them? 10 A. I think it was because the importance of the asset and 11 what we were asking -- I think it was primarily 12 associated with Scottish Water. We were -- it was 13 associated with access to their asset. There was 14 certain sections where, for example, down Leith Walk, 15 you had a sewer. It was 10 metres down. There was no 16 way we were going to be diverting that, but 17 Scottish Water still wanted to ensure that we were going 18 to give them access to that, to the asset. 19 So therefore there was a requirement for them to go 20 in agreement with the Council, because tie was only 21 going to be there for a period of time. Scottish Water 22 wanted some assurance that this -- they would have the 23 right to gain access to these assets thereafter. 24 Q. Was it easy to get the Council involved in the agreement 25 process? 22 1 A. I think it was -- I don't want to call it a major issue. 2 I think it was only -- it's just like anything else in 3 terms of getting agreements. It takes a bit of time 4 going through iterations, but ultimately we got it 5 signed off, and I don't think there was anything onerous 6 about it at all. 7 Q. If we go forward and look at page 80 of your statement. 8 If you could look at paragraph 263, which begins at the 9 foot of the page. You say: 10 "I do not think necessarily that SUCs sought to use 11 the requirement for their approval of designs as 12 a bargaining counter to secure a better financial deal. 13 The SUCs were fully aware they had to give us their 14 approval. If we could prove that they had been 15 completely unreasonable withholding the actual approval, 16 we had grounds to go around it because we had powers 17 under the Tram Act." 18 Now, is what you are saying there that ultimately 19 you tried to get agreement, but if you couldn't, you 20 would just fall back on your statutory powers and do it 21 anyway? 22 A. As I say, it was a lot better to work with a willing 23 horse. So we were very much of the opinion that we 24 wanted to have good relationships with the SUCs, and to 25 be quite frank, I don't think there was any situation 23 1 where I felt that we were being held to ransom. 2 Q. I want to go back and look at an earlier part of your 3 statement now on a different matter. It's paragraph 45 4 on page 15. You note there: 5 "The programme should allow for dealing with the 6 expected level of effort or work that it entails. The 7 exceptions will come along when, for example, we would 8 come across an unidentified service or there were 9 problems due to other ongoing work in the same area. 10 These issues do arise but generally they should be the 11 exception rather than the rule." 12 Now, that gives the impression that finding 13 unexpected utilities would be something that is the 14 exception or a slightly unusual one? 15 A. No, I think the clarity there is the programme should 16 allow for -- the respect of utilities had been 17 identified, then taking cognisance of the area, the 18 environment that we're in, and it's an industry-wide, 19 what do you call it, accepted, non -- the utility 20 records are very, very poor, or were very, very poor at 21 that time, and it is not uncommon to come across what we 22 call unidentified services. 23 So there should be a contingency within your 24 programme that should allow for that. What we felt was 25 that within the programme there wasn't enough 24 1 contingency taken by the contractor for coming across 2 these unidentified services. And then the other issue 3 there I'm referring to is if there are other ongoing 4 works in the same area, which may conflict with the 5 works that we are carrying out. 6 Q. Talking about finding unidentified or unexpected 7 services or, they are not in the position you expect 8 them to be, is that common in all works, utility works? 9 A. I think it's quite a common problem in terms of -- it's 10 becoming better because the requirements under ... 11 (Pause) 12 CHAIR OF THE INQUIRY: Sorry, I forgot to warn you, there's 13 a fire alarm test. 14 A. It's okay, I was aware of that. 15 MR LAKE: What you were just saying is -- I'd asked you the 16 question: is it common to find works not in the right 17 position. You said: 18 "I think it's quite a common problem in terms of -- 19 it's becoming better because the requirements under ..." 20 A. Under the New Roads and Street Works Act, there's 21 a requirement by the utility companies around the 22 contractors carrying out the works to clearly identify 23 and record the locations and depths and that of type of 24 all the services. That's now, but at the time then it 25 wasn't the case, and as I said, it is well known within 25 1 the industry in terms of the records that are carried 2 out by -- are therefore the utilities can be quite poor, 3 and when you are looking at a city of the likes of 4 Edinburgh, a very old city, some of the services are in 5 excess of 100 years old. 6 So therefore it wouldn't be surprising to find 7 utilities that were not previously identified. 8 Q. Was Edinburgh worse in that regard than other cities, 9 historical cities? 10 A. I don't think that it's any worse. I think it was just 11 the age of the city and type of city. It doesn't have 12 significant wide avenues other than your Princes Street 13 or Queen Street, but generally in a city of this age you 14 would expect to have utilities that have been there for 15 quite a few years and the records are either lost or 16 they were inaccurate. 17 Q. In terms of improvements to the records, is that 18 something that's a systematic attempt to review and 19 improve the records, or is it simply as you say under 20 the New Roads and Street Works Act, as anything is done 21 on the utility, the company is bound properly to log the 22 location for future reference? 23 A. There's a statutory requirement to log any utilities 24 now. But I think the industry accepts that they've got 25 to be improvements within the records, especially when 26 1 you're looking at utilities, and so there's been 2 significant improvements towards providing better 3 records for the utilities in general now. 4 CHAIR OF THE INQUIRY: What's been done in that regard? You 5 say there's significant improvement. 6 A. Well, there's now a requirement if you're diverting 7 utilities or you come across any utilities, even if 8 you're not, what do you call it, diverting them, you 9 have actually got to note it down on a drawing, record 10 the location, the depth and the type of utility that you 11 have come across. So whenever you open up a road or 12 whenever you're carrying out works and you're dealing 13 with the diversions, you've got to record accurately 14 what you're diverting and then any other utility that 15 you have come across whilst you are carrying out the 16 works. 17 CHAIR OF THE INQUIRY: Is there any plan or are records in 18 digital form, where the various services are 19 superimposed? 20 A. Yes. 21 CHAIR OF THE INQUIRY: That's currently done? 22 A. In some cases you have actually got 3D maps of them now. 23 MR LAKE: Is digital mapping of utilities locations 24 relatively recent or is it something that's been around 25 for a long time? 27 1 A. No, it's something that's relatively recent. 2 Q. Can you remember what stage digital mapping was at in 3 2007 when you started at tie? 4 A. Infancy. 5 Q. So do we take it from that that things have moved on 6 anyway in the last ten years? 7 A. Oh, yes. There's been significant improvements in that 8 field now, in terms of recording and noting down details 9 of all utilities. 10 Q. Are you able to offer a view as to what extent, if the 11 tram project was being done again today from scratch, 12 you would expect less -- fewer problems to arise? 13 A. I think that's only one of the problems. I think, yes, 14 it would be -- I would imagine it would be a lot better, 15 but that's only one aspect of it. 16 Q. What are the other aspects? 17 A. Well, you're talking about just in terms of finding 18 utilities. You've got to look at what you are actually 19 doing within the city. You've got the logistics of 20 carrying out the works. You've got to look at how you 21 are going to plan to do the works. You've got to look 22 at the constraints associated with your programme in 23 terms of embargos, businesses, and the local 24 communities. It's not just you're looking at the 25 location of utilities. You have to look at the whole 28 1 essence of the project, how you are going to manage the 2 project effectively going forward. 3 Q. But in terms of looking at some things you said there, 4 the logistics of carrying out the works, and that I take 5 it would involve such things as the need to divert 6 traffic and get the appropriate regulation orders to 7 allow you to do that? 8 A. Yes. 9 Q. If you start with better records so that when you open 10 the ground you don't get unpleasant surprises, does that 11 mean those processes of traffic management in a sense 12 can be done in a more straightforward, efficient manner? 13 A. No. If you're -- if you think in terms of your plan to 14 carry out the works is based upon the information you 15 have at the time. So therefore the information you have 16 at the time is more accurate. Then therefore your 17 programme will be more realistic. 18 So therefore in terms of getting your Traffic Road 19 Orders and your closures and your notifications out to 20 the various businesses -- the notifications out to the 21 local businesses and the populace, that wouldn't really 22 be changed. The only thing that would change is your 23 actual programme would be far more realistic in terms of 24 output because, as you quite rightly pointed out, the 25 surprises underground would be less. 29 1 Q. Just in relation to the question of surprises, you do 2 deal in your statement with the fact that the -- to what 3 extent the cost of finding additional utilities and 4 having to divert additional utilities could be 5 accommodated within the contingencies allowed for the 6 MUDFA works? 7 A. Right. 8 Q. That's dealing with the cost aspect. Was a sufficient 9 contingency allowed for the additional time that would 10 be required to deal with these things? 11 A. No. Because the programme had to be extended. 12 Q. Now, if someone -- I appreciate this would probably 13 pre-date your arrival in May -- April -- 14 A. March. 15 Q. March 2007. But if you're planning works and you are 16 allowing a substantial contingency for cost overrun, is 17 it not inevitable that you should also be allowing for 18 time overrun as well? 19 A. Yes. 20 Q. Do you have any idea why that wasn't done? 21 A. I think in terms of the contingency, as you rightly 22 point out, in terms of the cost element, the budget, 23 cognisance of the potential impacts on cost. I think in 24 terms of the programme, I don't think anybody really 25 looked at in terms of if you come across almost double 30 1 the amount of utilities, then effectively you're going 2 to probably take twice as long to do this. 3 So therefore I think the programme initially was 4 there was about nine to ten months of delay between 5 MUDFA commencing and Infraco commencing. And I think at 6 that time probably people putting the programme together 7 thought this was probably a sufficient period of time to 8 allow for any potential issues arising from unidentified 9 utilities and the likes. In hindsight, looking back 10 a bit, no, because I think the quantum of the increase 11 in utilities was fairly significant. 12 Q. But was it -- when you talk about the quantum of the 13 increase in utilities, was it really that surprising, 14 compared to other historical cities? 15 A. I can't really comment on that. I don't have a frame of 16 reference to compare against other historical cities. 17 Q. But if, on the original plan to have the nine or ten 18 month buffer between the MUDFA works and the Infraco 19 works, if the Infraco works had started to take 20 a long -- if the MUDFA works had started to take much 21 longer simply because of the number of utilities found 22 in the ground, that would quite rapidly erode that 23 buffer? 24 A. Correct. 25 Q. Dealing with the question of what was in the ground 31 1 then, you said that the records were poor. I take it 2 that was something that was well known about in 2007? 3 A. I would say so, yes. 4 Q. What was done therefore to try and get a better picture 5 of what was underground before the ground was opened? 6 A. There was various methods you could use to try and get 7 a clearer picture of what's in the ground. 8 We used ground penetrating radar, I think it was 9 Adien did that first. What that does, that identifies 10 objects, metallic objects, obstructions, cavities within 11 the ground. Unfortunately it's not completely reliable. 12 It's affected by moisture content. It's affected by the 13 strata material it's going through. And it could be 14 quite, shall we say, disappointing, the results you get. 15 So you had that, GPR. We did that throughout the 16 whole route, from memory. 17 The other method is far more invasive, is you put 18 trial holes. You actually dig trial holes, slit 19 trenches within the ground, to identify actual utilities 20 in the area where obviously to carry out this you've got 21 to put traffic management in place. And the actual 22 trial hole only identifies the location of the utilities 23 at that specific point that you're carrying out. 24 So in terms of actually identifying what actual 25 utilities you're going to come across along the whole 32 1 route of the tram, you would have to carry out trial 2 holes throughout the whole route, and that's wholly 3 impractical. 4 Q. That would involve essentially excavating everything 5 even before the work is done? 6 A. Correct. 7 Q. That's looking at what's there that has to be moved. 8 What about the space that it has to be moved to? 9 A. You carry out trial holes as well. We did trial holes 10 in terms of looking at the areas particularly, I think, 11 the Shandwick Place, the Haymarket area, where you've 12 got -- a lot of tenements have got underground cellars 13 that extend beyond the footprint of the building. So we 14 had to ascertain how much room we did have within the 15 footpath and outwith the LOD -- sorry, the DKE of the 16 tram. 17 Q. Just to establish those terms, the LOD, that will be the 18 limit of deviation -- 19 A. Limit of deviation. 20 Q. -- in terms of -- the space in terms of the Tram Act in 21 which the works will be put? 22 A. That's the whole -- yes. 23 Q. And the DKE? 24 A. Dynamic Kinetic Envelope. 25 Q. What's that? 33 1 A. That's effectively the influence -- the area that's 2 influenced by the tram that can impact on the utilities. 3 So you have to get all your utilities outwith the DKE. 4 I think from memory it was like 2.2 metres either side 5 the outside limits of the tram. 6 Q. Is that a matter simply of the space required for the 7 tram, or is that because of the electromagnetic field 8 created by the tram? 9 A. It's because of the electromagnetic field, it can cause 10 accelerated corrosion, it can cause distortion to 11 telecommunication lines, specifically if it's copper. 12 Q. In terms of the trial holes that were done here, what 13 was the plan in relation to trial holes? For the tram 14 project? 15 A. I think what we -- the way we tried to do it, we tried 16 to be selective in terms of identifying areas from the 17 record drawings we had from the utilities, where it 18 appeared there would be significant congestion of 19 utilities, so therefore selective in terms of 20 identifying these areas for carrying out trial holes. 21 As I have obviously stated earlier, it's quite an 22 invasive process and requires traffic management, 23 traffic road orders. In some cases you have to close 24 roads. 25 So rather than just doing it randomly, we selected 34 1 areas where we required to have better information to 2 ensure that what the design we were putting forward 3 would reflect the actual requirements at that specific 4 location. 5 Q. How did you identify which particular locations would be 6 the ones in which the trial holes would be required? 7 A. Using the records from the utilities. 8 Q. What identified where you would look? Was it areas of 9 particular congestion or areas where there wasn't 10 congestion? 11 A. We particularly focused on the areas where it looked 12 there was potential congestion, both in terms of the 13 actual utilities there currently, but more so in terms 14 of the space that we were going to be diverting the 15 utilities into. Because when you divert utilities, you 16 have still got the existing utility there, and you are 17 trying to find room for the new utility. It is not a 18 case of removing the old utility and putting the new one 19 in. So it's a significant issue in terms of you've got 20 a limited space available. 21 Q. Just in relation to the carrying out of trial holes, if 22 I could ask you to look at an email, please. It's 23 reference CEC01638353. 24 CHAIR OF THE INQUIRY: While we are waiting for that, 25 can I go back to that last answer you gave. The process 35 1 of replacing utilities, do I understand that you put the 2 new services in first. 3 A. Yes. 4 CHAIR OF THE INQUIRY: And then these become operational. 5 A. Yes. 6 CHAIR OF THE INQUIRY: And then do you remove the -- 7 A. No. Because to remove them, you would have to go and 8 dig up the road. If you think about, you've got -- the 9 existing utilities are directly below the track, the 10 proposed tram. You are putting utilities outwith that. 11 So your new utilities are outwith that. To remove these 12 utilities, you would have to go into the road and dig 13 them up. There isn't necessarily a requirement to do 14 that. The idea was when Infraco came along, any of the 15 utilities that would be impacting on their construction 16 works, they would remove it at the same time as carrying 17 out the track slab construction. 18 CHAIR OF THE INQUIRY: Thank you. 19 MR LAKE: We have got this email up on the screen now. 20 If you look at the lower half of the page to begin 21 with, we can see there's an email -- it's from Ray Dent 22 to you, dated 28 March 2007. So very shortly after you 23 arrived. 24 A. Yes. 25 Q. Who was Ray Dent? 36 1 A. I can't recall. 2 Q. If we look down, we see there's a heading now towards 3 the foot of the screen, "Site Attendance and Design 4 During Construction". He says: 5 "There appears to be an SDS tactic of avoiding doing 6 work now and accepting that it will have to be done 7 later where they expect to be paid, rather than use 8 current contract priced resources to do the job properly 9 now. Example, SDS want do [I don't know if that should 10 be "won't do"] trial pits to discover/confirm service 11 positions/depth (despite the fact that the contract and 12 their own strategy document requires that they 13 'investigate' where data is thought not to be good). 14 SDS were going to do hundreds of trial pits, then 15 proposed tens of trial pits, then 3 and now zero." 16 That seems to be suggesting that really no trial 17 pits were carried out in advance of the works. Was that 18 your understanding? 19 A. No trial pits were carried out at that point in time. 20 But then when I came along, we started doing -- we 21 started instructing the contractor to carry out trial 22 pits. I think it was -- this was an ongoing debate. We 23 were of the opinion that SDS, it was their remit to 24 satisfy themselves that they'd taken all necessary 25 action to ensure that the information that was being 37 1 provided in terms of the design took cognisance of the 2 actual utilities there. So if they had to carry out 3 trial pits to do so, then they should be doing that. 4 I think this was part of the issue, SDS didn't think 5 it was within their remit to do that. 6 Q. You said there you instructed the contractor to do trial 7 pits? 8 A. Yes. 9 Q. Do you mean Alfred McAlpine were doing the trial pits? 10 A. Yes. 11 Q. Now, by that time, by the time Alfred McAlpine were 12 being brought in and starting, it was not intended that 13 the SDS design for the utilities would already have 14 been -- 15 A. Under way. 16 Q. Yes. 17 A. Yes. 18 Q. It may seem obvious, is there not a difficulty in 19 carrying out a design until you've got the trial pits 20 and know exactly what's there? 21 A. Correct. 22 Q. So what, if anything, was done to try and require SDS to 23 adhere to their contract requirements to carry out 24 proper investigations before carrying out the design? 25 A. I think we -- I think there was an ongoing dialogue and 38 1 debate between SDS and ourselves in terms of we were 2 saying they should carry out the trial holes to ensure 3 that you have -- that you're satisfied that you have 4 identified all of the utilities. 5 I think in the event, we actually started doing it, 6 and I think we contra charged them for carrying out the 7 trial holes. 8 Q. What effect did the late information about trial holes 9 have on the preparation of the design for the MUDFA 10 project as a whole? 11 A. I can't really comment on that. I'm not really aware of 12 the impact at that point. I don't know what the impact 13 was of the late trial holes. 14 Q. Apart from the trial holes then you had the surveys, and 15 you said -- you have already said that there are 16 limitations to surveys. 17 A. Ground penetrating surveys, yes. 18 Q. I think if we look at page 39 of your statement, go back 19 to that, if we look at paragraph 119, halfway through 20 that, there is a sentence begins: 21 "The problem was that SDS did the ground penetrating 22 surveys and said we should be using them. However, 23 surveys are not totally reliable. They are influenced 24 by the moisture content of soil, the type of the soil 25 and the apparatus under the ground." 39 1 You give examples in relation to an underground 2 shelter at Haymarket? 3 A. Yes. 4 Q. The way you express that, it sounds like it's something 5 that you -- you're aware of the shortcomings of the 6 ground penetrating radar surveys? 7 A. Yes, most definitely. 8 Q. And were trying to communicate that to SDS? 9 A. Yes. The whole issue here was SDS were saying there was 10 no need to carry out trial holes because we are doing 11 ground penetrating radar surveys along the whole route, 12 and we were identifying to them that the issues 13 surrounding ground penetrating, in terms of it can't be 14 fully relied upon, and this was just an example where 15 there was a significant underground shelter. I mean 16 significant. And they'd already did the GPR survey 17 along that route, and it didn't pick the shelter up. 18 CHAIR OF THE INQUIRY: I think you say that you were finding 19 these shelters all over the -- 20 A. We found, I think, about three or four of them. This 21 was one of the largest. It dates back to -- it was 22 a pre-war shelter, with anterooms and bunk rooms and 23 conference rooms. 24 MR LAKE: If I could ask you to look in your statement, 25 please, at page 46. Paragraph 138. You note here: 40 1 "In their claim for variation of the Schedule 4 2 rates, AMIS [Alfred McAlpine] said that it was 3 inappropriate that the Adien survey was only 11% 4 of the total tram route (34.2 per cent of the roads). 5 More surveys were undertaken on this project than on 6 other projects which I have worked on. We had more 7 trial holes and more site investigations than would 8 normally be the case. We chose very selective areas 9 where we were aware that there was congestion of 10 utilities. We did trial holes and we did ground 11 penetrating [I think it should be "radar"] just to 12 confirm it. We were selective regarding where we 13 undertook surveys. When we saw a utility drawing which 14 suggested the congestion of utilities would be of an 15 acceptable level, then we did not do a survey." 16 A. Correct. 17 Q. Now, if you've already done surveys which are more than 18 on any other project, and you're finding these problems, 19 were you surprised to find the problems that arose 20 standing the fact that so many surveys had been carried 21 out? 22 A. From the ground penetrating, yes. But for carrying out 23 trial holes, no. 24 Q. What do you mean "for carrying out trial holes, no"? 25 A. We carried out the trial holes in a specific location. 41 1 We were actually identifying the actual utilities in 2 that location, whereas we're going back to the GPR. It 3 was maybe identifying that there wasn't a congestion of 4 utilities, or there wasn't any utilities in this area, 5 and then when you started to dig and (inaudible) around, 6 you started finding utilities. 7 So that was at the early stages of we were doing the 8 surveys, and selecting areas, and we were using the GPR 9 to augment the information that we had. But later on, 10 when we started realising that the ground penetrating 11 wasn't really as effective as it could be, we ultimately 12 actually stopped using it because it just confused the 13 matter. 14 Q. So the question of whether or not more surveys, more GPR 15 was undertaken here than on other routes is perhaps 16 a bit of a red herring if it wasn't able to find the 17 problem? 18 A. This was done in advance. Most of this was carried out 19 prior to my arrival, anyway. It was carried out by SDS. 20 Q. In terms of the -- you have mentioned how the records 21 have improved over time. Has over the last ten years, 22 has the GPR technology or replacement technology 23 improved? 24 A. I can't comment on that. I don't know. I would imagine 25 it has, but I can't comment. 42 1 CHAIR OF THE INQUIRY: Can I ask about these shelters again. 2 Were the shelters located in areas where you intended to 3 put utilities or were they located in areas where there 4 were utilities? 5 A. Twofold. They were in areas where we were wanting to 6 put the utilities, and they were in areas where the 7 actual tram slab was coming through. So in the areas 8 where the -- we had to put utilities, we had to take 9 down part of the chamber. And where the tram was going 10 to be going over the -- the track slab was going to be 11 over it, we actually had to reinforce the chamber. We 12 actually had to flood the chamber, because you cannot 13 have a substructure below the track slab because it 14 would affect the structural integrity of the tram slab. 15 So we had to actually just flood it with concrete. 16 CHAIR OF THE INQUIRY: How deep were your trial slit 17 trenches? 18 A. Approximately 1.5 metres to 2 metres. 19 CHAIR OF THE INQUIRY: So were they located, these chambers, 20 were they sufficiently -- 21 A. That's how we found them. 22 CHAIR OF THE INQUIRY: Thank you. 23 MR LAKE: Are there any records at all -- 24 A. We had the archaeologists, on all the chambers that we 25 found, we called in the archaeologist who came and 43 1 recorded it all, took photographs, took the various 2 records, before we flooded it. 3 Q. I was thinking more, were there any records in advance 4 of it? Did the Council or anyone else hold records of 5 where these shelters -- 6 A. Not that I'm aware of. If there were, we would have had 7 them notified on a drawing, and we would have been aware 8 of them. 9 Q. In terms of your -- it comes back to your question of 10 your dealings with utilities. 11 It is suggested by Alfred McAlpine or Carillion 12 that you and your team were acting as an interface 13 between the designers and each utility. 14 A. Mm-hm. 15 Q. And that resulted in some delay. Dealing with that, 16 were you acting as an interface between the designers, 17 SDS, and the various utilities? 18 A. Yes. 19 Q. Was that productive of delay? 20 A. That was actually -- actually improved -- what do you 21 call it, production, because the problem when we first 22 arrived, when I first arrived, was it was under -- as we 23 saw it, it was under SDS's remit to actually deal with 24 the utilities, do the design, negotiate, get agreement 25 of the design for utilities, and then pass it to us. 44 1 What was actually happening, they were producing the 2 design, issuing it to the SUCs, and sitting back and 3 waiting on them commenting, and we said we don't have 4 the time for this. 5 So we started liaising directly with the SUCs, and 6 ensuring that the quality of the drawings that we were 7 getting from SDS were of a standard that the SUC would 8 accept, and then we would be dealing directly with them 9 in terms of going over the drawings and discussing were 10 there any issues, have they had any comments. We would 11 then relay these back to SDS, get these comments or 12 matters addressed, so we could then re-issue the revised 13 drawing to them. 14 So the whole process was to actually streamline. 15 Q. You mentioned there at the start, getting designs of 16 sufficient quality to go to the statutory utility 17 company? 18 A. Yes. 19 Q. Was there an issue in relation to quality of designs? 20 A. Initially there was, when I first arrived there, yes. 21 Q. In what -- why were the designs not of sufficient 22 quality? 23 A. Each utility company has different standards and 24 different requirements and what they were saying is that 25 the designs that they were seeing from SDS didn't 45 1 necessarily fully address all their requirements. 2 Q. Did you manage to address that with SDS? 3 A. Yes, ultimately. 4 Q. You make the point within your statement that you 5 couldn't issue a drawing until the statutory utility 6 companies had agreed to it, but that those companies 7 were unable to review the drawings in the four weeks 8 that had been allowed to them in the contract programme. 9 Perhaps it would make it easier if I found you the 10 precise paragraph. If we go to page 38 within your 11 statement, and going to paragraph 116. You note here: 12 "Parsons Brinckerhoff said that the Statutory 13 Utility Company review to approval in four weeks was not 14 sufficient for most SUCs. That was in the discussions 15 with them before we signed the contract with SDS. It 16 was also in the programme that they provided to us in 17 terms of describing the process they were going to go 18 through. They were party to discussions about how we 19 were going to get drawings approved. The process was 20 agreed: they would get the SUC's drawings and we would 21 then review them. We would then look at where the tram 22 route is going to go, and then identify the diversion 23 route from it." 24 It goes on. 25 The point seems to be there -- I can see that you 46 1 are saying the four weeks was something that Parsons had 2 essentially agreed to at the outset, and this was them 3 saying this was one of the problems why they might need 4 more time or a different process. 5 A. Yes. 6 Q. What was done to deal with the fact, to get the utility 7 companies to give their approvals or consideration of 8 the designs within a four-week period, or could that not 9 be done? 10 A. I think it goes back to the initial statement, saying 11 that we were quite clear that it was under SDS's remit 12 to actually obtain approval. They were the ones that 13 agreed upon the four-week period. But by just issuing 14 the drawings to the SUCs and expecting them to come 15 back, without actually going to dialogue with them and 16 actually meeting with them to discuss what the issues 17 were, it was never going to happen. 18 So therefore, with the introduction of additional 19 members within the team who were going to be key points 20 of contact, with respect of SUCs, we started 21 streamlining that process. Because we would review the 22 drawings, make sure that they were to a standard that 23 the SUC would accept. We then issued to them, we say 24 issue the drawings to them; we then go into dialogue 25 with them, and over a period of time, we started getting 47 1 the process far more streamlined, and we were getting 2 the drawings approved far, far quicker than the earlier 3 stages. 4 Q. I think you said that one of the issues with the utility 5 companies is that they won't negotiate with a particular 6 contractor until after they've actually been appointed 7 to carry out the works, or it's clear that the works 8 were going to go ahead? 9 A. Yes. 10 Q. In relation to the tram project, did that mean that 11 there was a delay in essentially starting the whole 12 process of working out where the utilities were going to 13 go? 14 A. No, because the contract was with us. We were -- we 15 were actually going to be diverting all the utilities on 16 behalf of the SUCs. So I do not think that that really 17 played any part. 18 Q. Was there any delay in being able to start discussions 19 with the utility companies simply because the utility 20 companies said: no, we are not willing to deal with this 21 at this stage, come back to us when you're further along 22 with your processes. 23 A. Not that I'm aware of. 24 Q. In terms of the process for getting utilities moved, 25 there's reference within the papers to C4 information. 48 1 A. Yes. C4 estimate. 2 Q. Sorry? 3 A. C4 estimate. 4 Q. What is a C4 estimate? 5 A. A C4 estimate is the last -- is your more accurate 6 estimate prior to carrying out the works. It gives 7 an estimate of the cost associated with the diversion. 8 Q. And who prepares that? 9 A. In terms of -- if it's the SUC, the SUC will give you 10 an estimate to carry out the works. In terms of us, it 11 would be -- C4 would be based upon AMIS or Carillion 12 carrying out the works on their behalf. 13 Q. This project was unusual in the sense that as you say, 14 tie were going to carry out all the diversion works. 15 A. Yes. 16 Q. Instead of perhaps with something more minor, the 17 utility company themselves would carry out utility 18 works? 19 A. Yes. 20 Q. Then they would bill for their costs in carrying that 21 out? 22 A. Correct. 23 Q. Is a C4 estimate part of an indication of what they are 24 going to be billing? 25 A. C4 is an indication of what they anticipated the outturn 49 1 costs will be. That's then refined once the actual 2 costs, once the works were carried out. 3 Q. That's the way things work when the utility companies 4 are going to be carrying out the works? 5 A. Yes. 6 Q. If you go within your statement to paragraph 37, which 7 is on page 12. You note there: 8 "The Utility Management Plan refers to cost sharing 9 on page 17. Cost sharing falls under the New Roads and 10 Street Works Act 1991. Under that legislation, design 11 drawings are done then cost estimates are put together 12 based on what it would cost to move these utilities. We 13 then pay the SUC and if this was paid up front, there was 14 a discount. At the time we were getting something like 15 a 7/8% discount." 16 A. Yes. 17 Q. That's if things are done the traditional way? 18 A. Yes. 19 Q. Where the statutory utility company is moving. You 20 notice then that one pays the estimate upfront, and when 21 the actual cost comes in for the diversion, there is 22 a re-assessment of it against the estimate: 23 "If the actual costs are less, then a credit comes 24 back. If it is more, we pay the difference." 25 Again, that's all the standard -- the ordinary way 50 1 of doing things? 2 A. Yes, the standard. 3 Q. How did it work this time? In a sense, there wouldn't 4 be any need, was there, to agree an estimate with the 5 SUCs because you were doing it yourselves? 6 A. Yes. No, we agreed, with each section of works that 7 identified the number of utilities that had been 8 diverted, the type of utilities being diverted. Then we 9 sat down with the contractor and based upon the schedule 10 of rates that were within the contract, we then 11 qualified and quantified the actual cost of that 12 diversion. 13 And then that was agreed upon for that section of 14 works. 15 Q. You deal in the remainder of the paragraph we see on 16 screen there with what's normally done about betterment? 17 A. Betterment, that then goes back to the SUCs, in terms of 18 the older the asset, the greater the betterment. For 19 each different utility, there's an actual table that tells 20 you the returns you get based upon the age of the asset, 21 the type of asset, the capacity of that asset, and that 22 tells you the older it is, you'll get so much percentage 23 back of the costs associated with that. 24 Q. So if you've got an 80-year-old gas pipe or 25 a 100-year-old water pipe, and you are going to get a 51 1 modern -- 2 A. You get a significant betterment. 3 Q. Now, under the -- what we could call the normal scheme, 4 not the way it's done under the trams, if the utility 5 company are moving it, it means that instead of charging 6 someone for the whole of the cost, the utility company 7 would have to absorb part of it because they'd benefited 8 from the move? 9 A. They should, yes. 10 Q. But in relation in the tram project, where tie or their 11 contractors were to carry out it, you would be making 12 a claim against the utility companies for them to pay 13 you to the extent that there was betterment involved in 14 that? 15 A. Correct. 16 Q. So things were completely inverted in the sense that 17 this -- these moves were actually going to result in 18 utility companies having to pay monies out to a third 19 party? 20 A. Only when there was agreed betterment. 21 Q. Were there difficulties in agreeing the betterment? 22 A. I think in -- you've got to look at it in terms of the 23 scale of it. The real utilities that were affected were 24 primarily Scottish Water and British Telecom. In terms 25 of Scottish Water, I think we were agreeing as an 52 1 ongoing basis, the betterment associated with the 2 assets. 3 In terms of BT, that was more complex because the -- 4 there is no betterment if you are replacing like with 5 like or comparable, and their argument was that you 6 don't -- we were replacing copper lines with fibre optic 7 and they were saying there's no other equivalent now. 8 The fibre optic is the equivalent to that. 9 But the capacity of the fibre optic is way in excess 10 of the traditional copper line. So there was 11 significant discussions ongoing in terms of betterment 12 that we thought we were due from BT. 13 Q. Did these discussions on betterment take place while you 14 were trying to agree the design or were they taking 15 place after the works were all done and dusted and it 16 was just a matter of money? 17 A. No, it was an iterative process. You went through, as 18 you were going through, you tried to identify areas 19 where there was betterment. It didn't happen in all 20 areas. We tried to identify specifically with each 21 section you've got, this is a section of works carried 22 out, the asset is this old, this is the cost of it and 23 this is what we see as being the betterment associated 24 with that. 25 Q. When was that discussion taking place, before the works 53 1 were done or after the works? 2 A. That was taking place during -- before and during. 3 Q. Did it cause -- did those discussions cause any delay to 4 the works getting agreement? 5 A. No, none at all. 6 Q. Under the normal way of doing things, when a utility is 7 moved, it results in money coming into the utility. 8 A. Mm-hm. 9 Q. The way it was being done for the tram project resulted 10 in the utility companies expending money. Did that have 11 an effect on their attitude and their desire to 12 co-operate? 13 A. The utility companies only expended money when they did 14 the diversion themselves, and that was only primarily 15 Verizon. 16 Q. But if you moved an asset and there's any betterment, 17 this was going to be a cost to the utility company? 18 A. Yes. 19 Q. Which is quite a change from the normal position, that 20 when they move an asset, they are making a charge to 21 a third party? 22 A. Mm-hm. 23 Q. Did that affect the attitude and approach? 24 A. I don't think it did. I didn't see any of that 25 different attitude manifesting itself from the utility 54 1 companies. In fairness, the utility companies generally 2 were -- the relationship with them was pretty good, 3 surprisingly. 4 Q. You mentioned there Verizon, a cable company? 5 A. Mm-hm. 6 Q. They chose to do all their own move? 7 A. Yes. 8 Q. How did that work with them working alongside McAlpine 9 or Carillion? 10 A. You've got to look at the scale of Verizon's assets. 11 It's not significant. Their assets are very, very new. 12 They do their own in-house design. They do their own 13 installation. So in terms of -- it was actually quite 14 prudent to allow them to carry out the works. All we 15 did, we just tied in their diversions within our 16 programme, and ensured that the access to their area for 17 current diversion was done in time with the programme 18 requirements. 19 We ensured that there was no conflict between 20 themselves and the contractor carrying out the works on 21 our behalf. 22 Q. What about BT? From what you've said about putting in 23 fibre optics, it sounds like the actual works were done 24 by McAlpine/Carillion? 25 A. The contractor carried out at all the diversions for BT 55 1 other than the cable pulling. That was to be done by BT 2 themselves. 3 Q. So they put in the ducts the fibre optic cables were to 4 go through, but then BT came along and ran it 5 themselves? 6 A. BT came along, checked that the ducts were ready to pull 7 the cables, and then they would pull all the cables in 8 themselves. 9 Q. Was there any difficulty allowing them to do that, 10 rather than getting it done by Carillion? 11 A. In terms of what -- BT pulling the cables? 12 Q. Yes, having to liaise between -- 13 A. No. 14 Q. -- you bringing in another contractor on to site? 15 A. No, if you think about in terms of we would only bring 16 BT into the section once that section was complete. So 17 there wasn't a conflict between contractors. So you had 18 the section complete. You would have -- the ducts would 19 be mandrel tested, proved that they could take the 20 cables and then you sign off to BT. Then BT would then 21 organise to bring in their cable pulling gangs. 22 In terms of the actual management of traffic, it 23 wasn't significant because you only had the winch cable 24 at one end and the drum at the other end. So you had 25 about 400 metres down the road. So there was very 56 1 little traffic management associated with it as well. 2 Q. I was wondering, was there a delay before BT came in and 3 actually pulled the cables through that held everything 4 up? 5 A. Yes. 6 Q. What was done to try and minimise those delays -- 7 A. The delays were associated with the quality of 8 workmanship we were finding with the BT installation 9 works carried out by the contractor. 10 Q. And that, I think you referred there to a mandrel. 11 That's essentially pulling a plug through the installed 12 ducts to check it can move through, that they have been 13 installed correctly? 14 A. Yes. 15 Q. Difficulties arose with that in a number of respects. 16 It was found that the works were substandard? 17 A. Correct. 18 Q. And you had to get Carillion back to fix them? 19 A. Correct. 20 Q. That took time, more delay, more traffic disruption? 21 A. Correct. 22 Q. But once the works were done to satisfaction and the 23 mandrel was through, was the delay and additional 24 disruption waiting for BT to come in and actually pull 25 the cables through? 57 1 A. Nothing really comes to mind that was any significant 2 delays. 3 Q. In fact, is pulling the cable through something that 4 requires the road to be open, or is that done once the 5 road has been reinstated and just cables -- 6 A. The road is reinstated. Everything is finished. By the 7 time they come to pull the cable, the road is open. 8 It's finished. 9 Q. So it causes very little disruption -- 10 A. Very little disruption, because as I said, all you have 11 is localised traffic management around the winch at one 12 end and the cable drum at the other end. 13 Q. Verizon did both the design and the installation and BT 14 did that little last bit of the installation. Did other 15 utilities carry out the designs of their own -- 16 A. No. The only one -- BT carried out the design. But we 17 carried out the installation. Verizon did the design 18 and the installation, all other utilities, we carried 19 out the design and the installation. 20 Q. Why did tie allow BT and Verizon essentially to do their 21 own design? Was there any advantage to tie in that? 22 A. Yes, there was. Verizon were quite protective of their 23 own assets and their records were very, very good, and 24 they had an in-house team that were ready to carry out 25 on the designs and that suited us. 58 1 Similarly for BT, BT has a very complex 2 infrastructure, and as such they have got an in-house 3 team that's available to carry out the design works. 4 So we thought it would be prudent to allow them to 5 carry out the design as well. 6 Q. Did that result in any delay, allowing these two to do 7 their own design? 8 A. No. In fact I think it actually worked better. 9 Q. Would it have been practicable to have all utilities 10 carrying out their own design or would that have 11 resulted in delay? 12 A. No, not all utilities have the sufficient resource and 13 competence to carry out the design to that scale. 14 Q. Could we look, please, at another document. It's 15 CEC01827973. We can see here, this is a document from 16 Scott Wilson entitled "Utility Diversions - Strategic 17 Review". It pre-dates your arrival at the project, 18 10 April 2006. Did you see this document while you were 19 working on the project? 20 A. No, I don't recollect seeing this document. 21 Q. The pagination is curious. Can we see page 3, please. 22 Try page 4. 23 If we could enlarge the upper half of the screen, 24 thank you. 25 We can see the third paragraph here says: 59 1 "The full detailed design of diversions, scope of 2 works, specification and programmes must be complete and 3 agreed by all parties before works commence. It is also 4 of significant importance that all temporary traffic and 5 pedestrian management issues are addressed and agreed 6 before works commence." 7 Now, that didn't happen, did it? 8 A. No. 9 Q. Were you told when you arrived that that was the -- was 10 that the intention when you arrived, that the design 11 should be complete by commencement? 12 A. No. 13 Q. So it was always understood that the design would be an 14 ongoing process? 15 A. Yes. 16 Q. Do you consider that it was desirable or feasible that 17 the design would be carried out all in advance? 18 A. I think in terms of it's desirable to have all the 19 design complete in advance of the works commencing. But 20 because you've got the scale of the project, I think the 21 time period would be quite significant, and I think the 22 principle of having elements or sections of the design 23 complete to allow works to commence and then moving on 24 to the design to the next section, I think the principle 25 is ideal. It's the right principle because it reduces 60 1 the delay in commencement of your works, and allows the 2 works to commence at an earlier stage, but still ensures 3 that the design is complete in advance. 4 The only thing that I would have suggested is that 5 maybe the commencement of Infraco should have been 6 deferred to a later date, to ensure that the utilities 7 were actually diverted in advance sufficiently to allow 8 the Infraco works to commence without delay. 9 Q. Two things arising out of your answer. The first one, 10 you say the principle was a good one. Is that the 11 principle of just completing the design section by 12 section and then going in and doing that? 13 A. Yes. 14 Q. The second aspect is you say the Infraco start should 15 have been delayed. 16 A. I think it would have been prudent to have delayed it, 17 but I can't comment at the time because I don't know the 18 politics behind it, and I don't know how the contract 19 was set up and the time frame for it. 20 Q. Is that a comment you make with hindsight or is it 21 something you thought at the time? 22 A. I think with hindsight. I think anybody imagined that 23 you would find twice as much utilities as were found, 24 I think that would be unusual. 25 To find additional utilities is not unusual. But to 61 1 find twice as many, that's fairly significant. 2 Q. In relation to design, if we scroll down this screen 3 a little bit, we can see there's a paragraph, the third 4 last on the page: 5 "Since appointment SDS has, in the opinion of tie, 6 been slow to recognise and implement an appropriate 7 methodology for utilities diversionary works or to 8 produce and provide the necessary resources to enable 9 design to be completed and agreed by all parties to meet 10 the current project programme requirements milestones 11 of: Preferred MUDFA contractor appointment June (end) 12 2006; Commencement of onsite diversionary works January 13 (end) 2007." 14 Obviously this report was written before you 15 arrived. Did you have a view on the comments that are 16 made there about SDS and their performance? 17 A. Well, as I said, when I first arrived it was quite clear 18 that it wasn't working that effectively in terms of 19 producing the designs in a timely manner and getting the 20 designs approved as quickly as it could be, because 21 there was a disjoint, and I think there was a bit 22 of confusion in terms of what SDS thought the remit was 23 in terms of the contractual requirements. 24 Q. Were they not taken to the contract and pointed to the 25 various scope of services that -- 62 1 A. I don't think the contract is quite as explicit as that. 2 It's not quite clear as that definitive. 3 Q. Do you know whether anyone tried to do that with SDS? 4 A. Yes, we did. We tried to ensure that they carried out 5 the works as we interpreted the contract and said it was 6 their responsibility to actually ensure that they were 7 producing the designs in accordance with the programme 8 requirements and ensure that they would get a timely 9 approval from the SUCs which meant actually negotiating 10 with them, discussing with them, have an ongoing 11 dialogue with them. They didn't necessarily agree with 12 that. 13 Q. This report is noting problems that existed back in 14 2006? 15 A. Yes. 16 Q. What was the situation when you got there in relation to 17 design in April 2007? 18 A. I was made aware that the design was behind programme. 19 And I was made aware of the set-up they had 20 and I suggested certain things that I thought would 21 actually bring improvement to them. 22 Q. Did it work? Did they work? 23 A. I think it did. Ultimately, I think by about the end of 24 2007, we saw changes in terms of the design approvals, 25 and we were actually catching up with the programme, and 63 1 the delays were a lot less in terms of what we were 2 seeing come from design. 3 Q. There was some quite substantial slippage in the 4 provision of design for a while throughout 2007? 5 A. Yes. 6 Q. Could you look, please, at page 28 of your statement 7 again. 8 What I would like to do is look at paragraph 82 9 there. This is again just commenting on this Scott 10 Wilson report. You say: 11 "I note that the report states that TIE was critical 12 of the work by SDS by April 2006. SDS has an opinion of 13 TIE being slow to recognise and implement methodology 14 for the utilities diversionary works, or to reduce and 15 provide the necessary resources to the design." 16 I just wanted to understand what is the criticism 17 that's being made there of tie? Before we look at your 18 response to it, what is the criticism? 19 A. I'm not really sure. 20 Q. Do you -- 21 A. I would suggest it's their thinking that the support 22 from tie in terms of obtaining the approvals or 23 supporting the design process, I can only assume that's 24 what they've commented on. They're suggesting that tie 25 has a requirement to support the design team. 64 1 Q. In terms of tie providing the necessary resources to the 2 design, the design was an SDS function? 3 A. Correct. 4 Q. So were resources something that tie had to apply to 5 that? 6 A. The only thing that we applied to that once I arrived 7 was as I said previously, I brought in people that would 8 be key points of contact for the utilities, and then 9 they would then take ownership of these designs as they 10 were going through approval process to ensure that the 11 actual approvals were achieved as quickly as possible by 12 ensuring we had constant dialogue with the utility 13 companies. So that if they had any comments, any 14 queries regarding each plate or each design, these were 15 being addressed as quickly as possible, and that was 16 getting fed back to SDS and we were ensuring that SDS 17 responded quickly back to the SUCs. 18 That's the only thing we added into that. 19 In terms of the actual responsibility for the 20 design, no, that lay fair and square with the SDS. 21 Q. In relation to getting the design works down, I think as 22 a result of delays, there was a scheme put in place 23 called RATS? 24 A. RATS. Risk and trade-offs. 25 Q. Can you explain that, how it worked? 65 1 A. That was at the very early stages. We were trying to 2 get the works to commence as soon as possible after the 3 election and after we had the go-ahead. Because some of 4 the designs in the -- in terms of the programme, because 5 you want to address the critical path, but some of the 6 design elements were still not ready for us to actually 7 commence. So we identified specific areas where the 8 utility congestion was very little or there was few 9 utilities requiring diversion. So there were like 10 fairly simplistic areas. 11 So we identified ones, I think it was down at 12 Casino Square, down at Newhaven, and what we did was we 13 carried out trial holes, contractor carried out trial 14 holes, and he suggested the proposed diversion of these 15 utilities. 16 So he carried out the early stages of a design. 17 This was then put to SDS, so effectively the groundwork 18 was done by the contractor. It was put to SDS. SDS did 19 the sense check on it, verified it, and then that was 20 then put to the contractors. 21 It was just a way of trying to fast-track the design 22 in areas where it was a very simplistic diversion. 23 There was only a few areas that we could do that in, but 24 having done that, then that allowed us to commence works 25 at an earlier stage, but not necessarily on the critical 66 1 path, but it did allow works to commence. 2 Q. And that would be McAlpine essentially doing the 3 design? 4 A. They did the -- the feasibility design. They ultimately 5 passed it to SDS. SDS then checked it, because SDS were 6 still responsible for that design. 7 Q. Why was it called risk and trade-off? 8 A. I don't know. It was an AMIS anagram. It wasn't mine. 9 Q. Did it work? 10 A. It worked in the early stages, in just in terms of the 11 simplistic areas. But very, very quickly we -- it was 12 no longer feasible to use it. 13 Q. Feasible because -- not feasible because? 14 A. Because the areas that were moving it -- because we were 15 starting to move into the programme, the real programme, 16 which was the critical path, and these were not 17 simplistic diversions. So the risk and trade-off 18 proposal was no longer feasible for these areas. 19 Q. If works had been carried out under the risk and 20 trade-off scheme, did they ever have to be redone? 21 A. No. 22 Q. So that was a success in that regard? 23 A. It was -- yes. 24 Q. We've talked about delays arising from the election 25 which took place in 2007. Were there any designs ready 67 1 that could have actually resulted in works being carried 2 out at that time? 3 A. I'm not sure. I don't think so. 4 Q. So it's claimed by McAlpine, as they then were, that 5 there simply was nothing that could be done at that time 6 because there was no designs ready. So that would make 7 the election a bit of a red herring. Would you dispute 8 that? 9 A. The fact that there wasn't any designs ready at that 10 time, that's a matter of record because we actually 11 agreed a settlement with AMIS regarding that, because we 12 accepted there was initial design delay associated with 13 that. 14 In terms of the election being a red herring, 15 I can't really comment because I don't know what would 16 have happened if we had no elections at the time. 17 Q. In terms of the administration of the contracts with 18 McAlpine and Carillion, first of all, I should say that 19 there wasn't a change in the company. It was the 20 company changed its name from Alfred McAlpine 21 Infrastructure Services -- 22 A. I think Alfred McAlpine was bought over by Carillion. 23 Q. And they changed their name to Carillion Utility 24 Services? 25 A. Correct. 68 1 Q. During the works being carried out -- I'll simply call 2 them Carillion to cover all of them -- Carillion made 3 claims to you to change the basis on which they were 4 paid under the contract? 5 A. Yes. 6 Q. More than once? 7 A. Yes. 8 Q. If we could just please look at a couple of documents, 9 please. If we could look at CAR00000301. 10 This is a letter addressed to you. It's dated 11 11 March 2008, from Alfred McAlpine. 12 The third of the headings is "Schedule Four Rates 13 and Prices: Application of Clauses 46 and 50". Was this 14 one of the applications they made to change the basis on 15 which they were to be paid? 16 A. Yes. 17 Q. You will see a summary in the letter in the third 18 paragraph: 19 "AMIS MUDFA's concern with the suitability and 20 integrity of the Schedule Four Rates and Prices was first 21 formally notified under cover of letter reference ..." 22 That's given: 23 "... dated 3 April 2007, following discussions held 24 on 28 March 2007. 25 In the intervening period (fifty weeks) the concerns 69 1 expressed in the first instance by AMIS MUDFA have 2 proved to be well founded and been further compounded, 3 indeed exacerbated by issues emerging through the 4 management, by tie Limited, as Employer, Project Sponsor 5 and Project Manager of the emerging MUDFA works, together 6 with the IFC Utility Designs and Design Related 7 Information, Stakeholder constraints and Traffic 8 Management dependencies. 9 The Schedule Four Rates and Prices were predicated 10 upon (i) the successful completion; and/or (ii) 11 adherence to, the following key and critical requirements 12 established as the agreed baseline for management and 13 administration of the MUDFA terms and conditions." 14 You can see all that in the letter? 15 A. Yes. 16 Q. It goes on to set out a number of the assumptions, the 17 first being conspicuously that the total quantity of 18 diversions envisaged at that time was roughly 19 24,000 metres? 20 A. Yes. 21 Q. And that obviously changed dramatically? 22 A. Yes. 23 Q. On that basis Carillion argued that all the rates and 24 prices should be changed? 25 A. Yes. 70 1 Q. Is it correct to say that what they sought to do is move 2 to a cost plus arrangement, where they would be paid the 3 actual cost incurred by them plus a management fee of 4 some 15 per cent? 5 A. Yes. 6 Q. Could we look please at another production which is the 7 attachment to this letter. It's CAR00000302. 8 I think this is what's described as a report and 9 recommendation which was submitted to you arguing for 10 a change to these rates and prices. 11 A. Yes. 12 Q. Now, I think I'm correct in saying that there was never 13 agreement to do what was sought and the rates and prices 14 were never varied. 15 A. Correct. 16 Q. Can we look then please at a production CAR00000340. 17 Do you recognise this as a letter that you sent to 18 Carillion responding to the request we've just seen 19 dated 11 March? 20 A. I don't recognise it, but ... 21 Q. If you look at page 6 of it, it doesn't refresh your 22 memory that much, but we can see your signature and your 23 name on the end. 24 A. I'm not denying it's a letter that was issued. I just 25 don't recollect the letter, that's all. 71 1 Q. If we look at the whole of this page, you note: 2 "We have reviewed the synopsis of the submission 3 contained within Appendix A of your submission and 4 reject your proposal for a cost plus management fee of 5 15% arrangement. 6 In light of the above, and for the avoidance of 7 doubt, we reiterate our position that the Schedule Four 8 Rates and Prices do not require to be reviewed, amended 9 or adjusted." 10 I think that remained the tie position throughout 11 the works? 12 A. Correct. 13 Q. There was more than one request made to move to a cost 14 plus contract -- 15 A. There were numerous requests. 16 Q. And numerous refusals? 17 A. Correct. 18 Q. I want to turn now to the question of the progress with 19 the works and how that was carried out. 20 I just want to ask you a bit about reporting. If 21 you can look, please, at production CEC00983221. We can 22 see these are the papers for the Tram Project Board 23 meeting that was to take place on 8 July 2009. 24 You're not named on these papers. Did you ever have 25 sight of these while the works were being carried out 72 1 during the project? 2 A. No. 3 Q. I'll just ask you, if I can, to look at page 13, please. 4 In fact it would be easiest if we go to page 12 first of 5 all. Apologies. 6 If you enlarge the lower part of the screen, we can 7 see there's a heading "Progress - MUDFA", and it notes 8 that: 9 "Progress on MUDFA works during Period 3 is 10 presented below." 11 If we just look at the column headings for the 12 moment, we can see that the three right-hand ones are 13 the cumulative, planned and actual, and the delta or the 14 difference between those two; do you see that? 15 A. Mm-hm. 16 Q. If we then go over the page and look at the upper half, 17 we can then see the results of this. If we look at the 18 cumulative position and the total route, it was 19 82.2 per cent planned for completion, 78.6 completed, 20 and that means it was just 3.6 per cent behind schedule. 21 Did you ever see these tables or provide the 22 information for these tables? 23 A. We will have provided the information that reflected the 24 actual progress of the MUDFA works at any point in time. 25 We never produced those tables. 73 1 Q. You didn't produce the table itself? 2 A. I don't think we produced the tables. We would have 3 produced the information for those tables. 4 Q. That's the July position. If we could then look at the 5 August position, if you could look at production 6 CEC00739552. 7 We can see from the front page there we're now 8 looking at the Tram Project Board papers for 9 August 2009. Do you see that? 10 A. Yes. 11 Q. Could we look at page 14 of this, please. We can see 12 the same sort of table. Looking at the cumulative 13 figures now, we can see there's been a sudden jump to 14 100 per cent should have been completed right across the 15 board, and the actual slips a little bit on that, with 16 a delta of 3.4 per cent. 17 Are you aware why there was a sudden jump in these 18 figures in terms of the planned completion between July 19 and August? Was that to do with works being hived off 20 from Carillion and given to other contractors? 21 A. I think that was round about the time when we were 22 transferring works from the MUDFA project to Infraco. 23 That would tie in around about that period, I think, 24 then. 25 So you'd get the effect of the -- the cumulative 74 1 volume of work required by MUDFA would then reduce, so 2 therefore the amount of outstanding work would be less 3 than it was previously. So therefore you'd get an 4 increase, a disproportionate increase. So I would say 5 that ties in around about the time. 6 Q. So works that were no longer to be done under the MUDFA 7 contract, even though there were utility works to be 8 done, they wouldn't be listed here? 9 A. Correct. Correct. 10 Q. It also becomes apparent that eventually the contract 11 with Carillion is terminated by agreement -- 12 A. Mm-hm. 13 Q. -- and alternative contractors were brought in to 14 complete the works? 15 A. Yes. 16 Q. Was that just to do this last 3.4 per cent or was it 17 discovered that there was in fact more to do than was 18 appreciated? 19 A. No, I think the whole premise of transferring the works 20 over to Infraco was a twofold thing. I think Carillion 21 had made a -- expressed a wish to terminate the contract 22 as soon as possible, and the areas that were outstanding 23 were areas that Infraco were looking to get into anyway. 24 So it was probably -- the best proposal was to actually 25 transfer these areas over. It suited both parties. 75 1 Q. But as well as giving works to the Infraco contractor, 2 works were given to substitute utilities contractors, 3 Clancy Docwra and Farrans; is that correct? 4 A. Mm-hm. 5 Q. Why was it felt necessary to bring in substitute 6 contractors to finish the utilities work? 7 A. I can't comment. That was done through the Infraco 8 team. 9 CHAIR OF THE INQUIRY: Were Farrans the contractor who was 10 working in the tenements? 11 A. No. The -- if you're on about the replacement of the 12 gas. 13 CHAIR OF THE INQUIRY: Yes. 14 A. No, that was Turriff. 15 MR LAKE: I think Farrans might have carried out some work 16 at the airport. Were you aware of that? 17 A. I think Farrans did the work at the airport. I think 18 Clancy Docwra did the work down Constitution Street, 19 from memory. 20 Q. I appreciate that you had left the project in 2010, but 21 the works weren't completed then, were they? 22 A. MUDFA, as far as I was concerned, was complete, but the 23 actual tram works were not complete, no. 24 Q. But utilities works were still incomplete. Were you 25 aware of that? 76 1 A. In terms of the works that had been transferred over to 2 Infraco? 3 Q. I couldn't say necessarily whether they were the ones 4 transferred, but there were still utility works 5 outstanding. 6 A. There would be still utility works outstanding because 7 we had actually transferred the remaining part of the 8 works over to Infraco, and I was aware that there were 9 still utility works to be diverted under the Infraco 10 contract. 11 Q. So in terms of the ones that were to be dealt with 12 either by Carillion or the substitutes, Clancy Docwra 13 and Farrans, those works were completed as far as you 14 were aware? 15 A. No, I think they were still ongoing when I left. I'm 16 pretty sure Constitution Street was still ongoing when 17 I left. 18 Q. Do you know when those works were finished? 19 A. No, sorry. 20 CHAIR OF THE INQUIRY: Mr Lake, is this a convenient moment? 21 MR LAKE: Yes. 22 CHAIR OF THE INQUIRY: We will have a break now for the sake 23 of the shorthand writers. For about 10 or 15 minutes. 24 We will break now and resume again at 11.25. 25 (11.09 am) 77 1 (A short break) 2 (11.27 am) 3 CHAIR OF THE INQUIRY: You are still under oath, Mr Barclay. 4 Yes, Mr Lake. 5 MR LAKE: My Lord. 6 Could we look at your statement, please, at page 18. 7 In particular, paragraph 51. If you look at this: 8 "Clause 46 was in relation to snagging and defects." 9 I should say, we saw a reference to Clause 46 on 10 their claim for additional time: 11 "Our view was that nothing had changed. We looked 12 at the programme and it was evident that AMIS were 13 under resourced. We actually wrote to them numerous 14 times referring them to sections that had been excavated 15 but where no one was working. All they had to do was 16 refer to the complaint register. AMIS was asked why we 17 had so many complaints about sections of their work. 18 A lot of the complaints were based upon people saying 19 the contractors had closed an area off but no work was 20 being carried out. Another common complaint was that 21 workers would be at the site but not working because of 22 insufficient resources. As a result the contractor 23 supplemented the workforce but the quality of some of 24 the work was questionable." 25 Now, you refer there to claims that they were 78 1 under resourced, and there's evidence of people standing 2 around doing nothing. 3 A. Yes. 4 Q. Did you have other evidence to substantiate the claim 5 that there were a lack of resources applied to the work 6 by Carillion? 7 A. Within the contract there's a requirement for the 8 contractor to provide us with an update of programme on 9 an ongoing basis. I think from memory it was like every 10 month, and within that programme they would identify the 11 progress of works that had been achieved that day and 12 time. And then they would identify the forecasted 13 planned work for the future. 14 Within that, they obviously assigned the outputs 15 they were expecting from that and the resources that 16 they were going to assign to the various sections of 17 work. 18 So we would always cross-reference to the sections 19 of work, saying: in that area there you have identified 20 so much resource to be assigned to that. You're 21 under resourced in comparison to your programme. We 22 continually assessed the outputs that they were 23 achieving, and they were never actually ever achieving 24 the outputs that they stated within their programmes, 25 and we were saying there's a direct correlation between 79 1 the fact that you are under-resourced, you aren't 2 supervising the works properly, therefore that's having 3 an ultimate effect on the outputs that you are achieving 4 within the period. 5 Q. Could I ask you to look at a document, please. It's 6 CEC01369430. You can see this is a letter dated 7 12 May 2008. It's from McAlpine, and it's addressed to 8 you. Do you see that? 9 A. Yes. 10 Q. If we look at the second paragraph of the letter: 11 "In order to confirm these discussions, AMIS MUDFA 12 wish to refute the content of the Report ..." 13 That's the sub-committee report: 14 "... in its entirety, specifically the Executive 15 Summary, assertions relating to the Revision 07 16 Programme and the ongoing unsubstantiated and anecdotal 17 assertions relating to the availability of AMIS MUDFA 18 resources." 19 They are taking a very different view there, and 20 they describe obviously your views as anecdotal and 21 unsubstantiated. 22 A. Yes. 23 Q. Can you comment on that? 24 A. We totally rejected that in terms of it wasn't 25 anecdotal. It wasn't unsubstantiated. We had actually 80 1 identified in terms of relating to the programme that 2 they provided, the resources they said they were going 3 to assign to it, and the fact they never resourced it to 4 the adequate levels that they identified in the 5 programme, and this further was substantiated by the 6 lack of progress and outputs within the works that were 7 an ongoing basis. 8 This was further substantiated by the fact that we 9 were continually getting complaints within the register 10 in terms of lack of activities ongoing and sections of 11 works that had been closed off. Where there was 12 supposed to be works ongoing, no one was actually there 13 carrying out the works. If they were, they were 14 completely under-resourced. 15 Q. Those were the actual works on site? 16 A. Yes. 17 Q. If you could look, please, in relation to the design 18 works, page 39 of your statement. Paragraph 120. You 19 say there: 20 "The graphs detailed within MUDFA Report dated 21 12 March 2008 and also the report dated 9 April 2008 22 just highlight what I have stated regarding the extent 23 of the slippage. There is nothing more to add." 24 If you could just look, please, at those graphs, if 25 we look firstly at CEC01453676. This is the MUDFA 81 1 sub-committee report papers for a meeting on 2 12 March 2008. 3 If we could go forward, please, in this to page 27. 4 Go to page 28. Rotate that. 5 It's said in the introduction they were looking at 6 design. I think this, rather than design, is actually 7 the works being carried out on progress. 8 A. Mm-hm. 9 Q. The contractor's work carrying out utility diversions? 10 A. Yes. 11 Q. Could you explain what this graph is telling us? 12 A. It's actually telling you there that you've got -- 13 there's various curves there. One curve is cumulative 14 current budget hours approved. That's the top line. 15 The green is the cumulative recovery programme of 16 what they are forecasting to achieve. 17 The blue line is actual, what they've done, and the 18 bottom line is actually original budgeted hours, which 19 tell me they're expending a lot more hours on actual the 20 works that they budgeted for. 21 Q. So they're spending the time, but this is not -- 22 A. This is actually telling you -- this is the level of 23 effort that's actually -- the hours they are expending 24 to do the works. The problem was the contractor had 25 employed the resources on an hourly basis. The contract 82 1 was based upon re-measure. So for every hour that the 2 resources worked, they were paid for, irrespective of 3 the output they achieved. It wasn't back-to-back with 4 the contract, so it wasn't really compatible with the 5 contract. 6 Q. So this is not actually in a sense -- in any sense 7 recording what was being achieved. This is just 8 recording the time being spent doing it. 9 A. It's actually looking at what they had actually planned 10 on putting the level of effort and what they were 11 actually expending. So you could see that they were 12 expending a lot more than they actually planned for. 13 Q. Could we go then and look at page 36. 14 This time, we can see from the title, we are looking 15 at the issue of IFC design packages for construction in 16 relation to MUDFA works? 17 A. Yes. 18 Q. Can you explain what this graph is indicating? 19 A. This graph is indicating that the actual design works 20 are way behind what was planned. 21 Q. I think the red line here is the actual cumulative 22 release of design packages? 23 A. Correct. 24 Q. The blue dashed line to the left is what was originally 25 planned? 83 1 A. Correct. 2 Q. The black short dashes indicate the -- what the current 3 plan is? 4 A. Yes. 5 Q. But finally, the pink dashed line is indicating the 6 latest forecast? 7 A. Mm-hm. 8 Q. We see that's quite substantially behind -- 9 A. Correct. 10 Q. -- what the original programme was? 11 A. Correct. 12 Q. Indeed, the red line, which is showing the actual 13 position, we can see how that has slid dramatically. 14 What were the causes of this delay? 15 A. The cause of delays could be numerous factors. It could 16 be the resources being applied by SDS to carry out 17 works. It could be the complexity of the actual 18 diversion works, and it could be associated with 19 a change in the programme requirements based upon round 20 about that time, Infraco would be starting to influence 21 the sections of work that we were going to be addressing 22 on the critical path. 23 Q. In relation to other design aspects, if I could ask you 24 to look at production CEC01456730. I think we can leave 25 that. That's just going to go over the same ground 84 1 again. 2 Now, because these designs were so substantially 3 late, I think it's correct that there was a claim 4 submitted by Alfred McAlpine or Carillion, and it had 5 to be met because they had been delayed in carrying out 6 their works? 7 A. Correct. 8 Q. I think you noted within your statement there was one 9 settlement, and you thought this might have been another 10 one after you left? 11 A. Mm-hm. 12 Q. Could we look, please, at a production, please, which is 13 CAR00000243. 14 You can see this is a letter from Carillion to 15 Steve Bell at tie and it's dated 19 March 2009; do you 16 see that? Do you recognise this letter? 17 A. I'm sorry, I don't. 18 Q. You can see what it says is: 19 "Please find attached the executed version of the 20 above agreement ..." 21 Which is a Settlement Agreement of September 2008: 22 "... as agreed by ourselves for the full and final 23 settlement of all issues which relate to or are associated 24 with the works up to and including 30 September 2008." 25 I think the earlier agreement you refer to in your 85 1 statement managed delay up to September 2007? 2 A. Yes. 3 Q. This is one which appears to consider another year and 4 amounts to another payment to be made to Carillion in 5 respect of the delays to the works? 6 A. Mm-hm. 7 Q. If you look at page 2, the content of this, we can see 8 that the heading 2.1, it notes: 9 "A settlement Sum was agreed to cover all issues to 10 end of September 2007 and included the resetting of 11 baseline programme (Revision 06) with a revised 12 completion date of 30 November 2008." 13 Now, that was a Supplement Agreement you refer to in 14 your statement? 15 A. Yes. 16 Q. It continues: 17 "Position from October 2007 ... to 18 30 September 2008. 19 Following the agreement reached in September 2007 20 a number of issues have adversely affected the delivery 21 of the Contract as follows. 22 Delay and Disruption in relation to: 23 Number and extent of unidentified services 24 encountered. 25 Design delivery. 86 1 Resolution of technical queries. 2 Carillion production inefficiencies. 3 Traffic Management arrangements." 4 Did you consider all these things had been factors 5 which had resulted in delay and disruption to Carillion 6 works? 7 A. No. 8 Q. No? 9 A. No. 10 Q. What do you consider in that hadn't resulted in delay to 11 Carillion works? 12 A. Well, the number and extent of unidentified services 13 encountered, we were already within the contract that 14 allows for the provision of additional services 15 encountered and they are paid that on a re-measurable 16 basis. And we agreed as an iterative process, the 17 additional time associated with carrying out these 18 additional diversions. So delay and disruption, I'm 19 sorry, I don't agree with that one. 20 In terms of Carillion production inefficiencies, 21 I don't know what that makes reference to at all. 22 I would like to think it's their inefficiencies but 23 I don't think it is. 24 The traffic management arrangements, within the 25 contract, the traffic management constraints were a lot 87 1 more onerous than what we were actually imposing upon 2 the contractor; at the end of the day, we actually 3 relaxed some of the traffic management constraints in 4 terms of the actual length of sections we were opening 5 up to them to work on. 6 I think -- the contract was only 100 metres at 7 a time, 100 metres lead in, 100 metres of construction 8 and 100 metres of exit. We actually extended that to 9 something like approximately 400 metres of actual 10 construction works. 11 So I don't agree with some of the comments there. 12 Q. I take it from the answers you have given so far in 13 relation to this, you weren't consulted in relation to 14 this? 15 A. I don't recollect this, to be honest with you. 16 Q. If we look over the page, firstly, finishing on that 17 page, we can see it notes at the bottom of the page: 18 "In addition to the above and as part of the 19 agreement for all issues up to 30 September 2008, 20 a number of measurement issues between the parties have 21 also been resolved and concluded, these are listed in 22 Appendix A." 23 You wouldn't have been involved in that either then? 24 A. Not that I can recollect. 25 Q. If you look over the page, please, under the heading 4, 88 1 we can see it says: 2 "As a result of the above issues and the subsequent 3 delays to the construction works the MUDFA Revision 06 4 Programme for the Tram Project has been prolonged, 5 resulting in the preparation of the MUDFA Revision 07.9 6 programme." 7 It notes: 8 "Revision 06 MUDFA construction completion 9 programmed 30 November 2008. 10 Revision 07.9 MUDFA construction completion 11 programmed 1 April 2009. 12 The delays experienced and the resultant 13 prolongation of the programme have resulted in the 14 following agreed consequential impact: 15 The programme, as originally priced by Carillion, 16 for the MUDFA works has been extended. 17 This has resulted in: 18 4.1. Extended and additional Prelims." 19 A. But that was covered in terms of we would allow, as 20 I said, we've came across extended additional utilities, 21 we would agree an extension of time based upon the 22 actual quantum of the increase, and that would be 23 dictated by the actual outputs within the original 24 contract period. So that was already covered. 25 Q. If there were going to be more utilities moved, 89 1 a greater length diverted? 2 A. That would have a compounding effect as well. So we 3 deal with that under the contract. 4 Q. It would obviously take longer, they would be given 5 longer, and they would have to be paid additional 6 preliminaries for that? 7 A. And they get paid for the additional increase in the 8 actual utility diversion under the measure rate. 9 Q. And in relation to the question of design delivery, 10 delays in design delivery, that too could have prolonged 11 the works? 12 A. Yes. 13 Q. And might have given rise to an expectation they would 14 be paid for the additional preliminaries? 15 A. At the early stages I would say, yes, which we agreed 16 ourselves. 17 Q. That's in the agreement up to September 2007? 18 A. Yes. 19 Q. What about design delays in the period from 20 September 2007 in the year up to September 2008? 21 A. You have got to look at those design delays, are they on 22 the critical path and are they associated with the 23 sections of work, that Carillion were working in. 24 Q. Do you consider that they were on the critical path and 25 associated with the Carillion works? 90 1 A. Not after about the end of 2007, going into 2008. We 2 were still experiencing some delays in design, but 3 nothing to the extent we were experiencing at the early 4 stages. 5 Q. If we look over to page 3 of the document, the following 6 page. It's page 3 of the document, page 4 of the scan. 7 We can see under the heading "5.0 Commercial 8 Settlement", it says: 9 "The commercial settlement in relation to the above 10 to the end of September 2008 is as follows." 11 1, Measurements items, and there's a sum of 12 GBP150,000; and 2, Delay and disruption to 13 30 September 2008, a sum of GBP1,050,000. Do you see 14 that? You weren't consulted about these figures, you 15 had no idea how they were arrived at? 16 A. I can't recollect that. 17 CHAIR OF THE INQUIRY: If you had been consulted, what view 18 would you have expressed? If you had been consulted? 19 A. If I'd been consulted regarding that, there's several 20 items in there that I disagree with. We have already 21 covered. Because it goes against what we were actually 22 saying in terms of we were actually in ongoing 23 correspondence with the contractor right from the onset 24 of the project, basically refuting their claims of delay 25 and disruption, as we were assigning it to the fact that 91 1 they were under-resourced, they weren't supervising 2 their works properly and they weren't planning properly. 3 So they were looking for -- recover monies through what 4 we saw as purported claims. 5 CHAIR OF THE INQUIRY: If you're right, does that mean that 6 this settlement is at least excessive? 7 A. I think it is. 8 CHAIR OF THE INQUIRY: Did you think or do you think there's 9 any justifiable claim at all here? 10 A. To be quite honest, I don't have all the details in 11 here. So it would be wrong for me to make any further 12 comment on it. 13 CHAIR OF THE INQUIRY: Thank you. 14 MR LAKE: Could I ask you to look at another document, 15 please. It's reference CAR00000194. You can see this 16 is a letter again from Steve Bell, it's addressed to 17 Steve Beattie, the Project Director at Carillion, and 18 it's dated 24 March 2009. Do you see that? Do you see 19 that? 20 A. Yes, sorry, yes. 21 Q. Perhaps if we could just slide down the page a bit to 22 look beneath the signature, further down, we can see 23 that this letter was copied to you, or appears to have 24 been copied to you at the time? 25 A. Yes. 92 1 Q. Do you recall the letter at all? 2 A. No. Sorry. 3 Q. If you look back at the text of the letter, it notes: 4 "Following our discussions and subsequent agreement 5 of the Revision 7.9 Programme completion date for the 6 MUDFA Works, we write to formally grant an extension of 7 time to the substantial completion of the MUDFA Works 8 and the Longstop Date. This is pursuant to Clause 38.3 9 of the Agreement. 10 In accordance with Clause 38.3, we confirm the 11 substantial completion date has been revised to 12 1 April 2009 and the Longstop Date has been revised to 13 3 August 2009. 14 As agreed we confirm the Settlement Agreement, 15 reference Carillion (CUS) Claims Settlement Agreement, 16 16 January 2009 signed and dated 23 March 2009, 17 includes provisions under Item 5.2.2 for the agreed 18 maximum 64 No CUS staff positions to be certified as 19 preliminaries, which shall be aligned and reduced 20 accordingly with the requirements of the programme to 21 completion." 22 We can see that's making reference to the Settlement 23 Agreement we've just been looking at? 24 A. Yes. 25 Q. Did you make any comments or representations in relation 93 1 to that Agreement at the time or enquire on what basis 2 it had been settled? 3 A. I can't recollect. I have just said I find it 4 surprising, but I can't recollect if I did or not. 5 Q. If we could look at your statement, please. I don't 6 think I need to go to that. Instead I would like to go 7 to another production. It's CAR00000163. We can see 8 this is once again a letter from Steve Bell to 9 Steve Beattie at Carillion. This one is dated 10 11 September 2009. 11 We can see what this appears to be doing is, on the 12 third paragraph, granting an extension of time for the 13 substantial completion of the works, this time to 14 3 October 2009. Do you see that? 15 A. Yes. 16 Q. Were you involved in consideration of that extension 17 being granted? 18 A. I think the only thing we could -- I could refer to is 19 that we were continually assessing the end date of the 20 programme based upon the increasing number of utilities 21 at the time. So we were reviewing the programmes on an 22 ongoing basis and granting them extensions of time based 23 upon the quantum increasing. So I'm not sure whether 24 this is doing a wrap-up of the accumulation of them or 25 not. 94 1 Q. What might be said for Carillion is that the fact that 2 extensions of time had been granted indicates that 3 Carillion aren't at fault in terms of under-resourcing 4 the project and it's just a matter of late design and 5 additional utilities having to be dealt with. 6 A. No. Two different matters. One, you've got a contract 7 entitlement. That is what the contract states. So if 8 you find additional works, they have a contract 9 entitlement to get an extension of time, based upon that 10 quantum and based upon the outputs that are within their 11 tender sums. Then you have what they produce as their 12 forecast programme works. Now, if they had forecast 13 a programme and actually achieved what they were saying 14 they were going to achieve, then that's a different 15 issue. 16 What we're saying here is their entitlement under 17 the contract which is fair and reasonable. However, our 18 argument was it was self-evident that the way they were 19 carrying out the works was wholly inefficient, and they 20 could have completed the works far, far sooner than what 21 they did. 22 So whilst they have entitlement under the contract 23 which identifies they have got an extended period to 24 carry out the works, it still doesn't negate their 25 obligation under the contract to try and mitigate delays 95 1 as much as possible. 2 So we were saying they have got an entitlement to 3 that in the period which then removes any chance of LDs 4 being applied to them. However, they have still got an 5 obligation, a responsibility to actually finish the 6 works as quickly as possible, and we were saying it's 7 self-evident that the way they're doing it, they're 8 under-resourced, they are not supervising the works 9 properly, and they're not achieving the outputs that 10 they say they are going to achieve. 11 Q. Just for clarity, you said LDs. That's liquidated 12 damages? 13 A. Sorry, liquidated damages. 14 Q. In the same vein, but slightly earlier, could I ask you 15 to look at another email. It's CEC01140099. Look at 16 the upper half of the page. You can see this is an 17 email from someone called Christie Graham within 18 Carillion. It's addressed to Steve Bell, but you are 19 included as one of the people to whom it's copied. It's 20 dated 22 October 2008; do you see that? 21 A. Yes. 22 Q. What the text of the letter says is: 23 "As briefly discussed yesterday (and I have included 24 more detail on some of the issues for clarity), I list 25 below the major items which are currently detrimentally 96 1 impacting or likely to detrimentally impact the MUDFA 2 completion programme." 3 If we just read the main bullet points, the first is 4 traffic management constraints. 5 A. Yes. 6 Q. The second, that the design is incomplete. 7 A. Yes. 8 Q. Third, that there are many existing utilities which are 9 unforeseen, congested and/or at shallower depths than 10 permitted under the specification or utility company's 11 requirements. The next is: 12 "Although there has been a vast reduction in the 13 number of open TQ’s [technical queries] over the last two weeks 14 as our respective teams are collaborating better 15 together, there are remaining technical queries to be 16 answered." 17 If you go over the page, it's said that: 18 "As a consequence of the above, there is 19 insufficient work available on site to effectively and 20 efficiently deploy our current resource level." 21 Now, we can see there that the nature of the 22 complaint here, without going to the detail, is simply 23 as a result of these various constraints, design and 24 traffic management, unforeseen utilities, there simply 25 isn't enough work for their workforce to do, and they 97 1 have had to demobilise people. That's an example of not 2 so much being under-resourced, but having too many 3 resources for the work available. Can you comment on 4 that? 5 A. I would only refer to our response to that. There's so 6 much detail in there, it's -- I would be very, very 7 surprised that we accepted that. 8 Q. Did you feel that generally the situation was that there 9 simply wasn't enough work for Carillion to do? 10 A. No. 11 Q. At what stage after your involvement in the MUDFA 12 programme was it apparent to you that it was not going 13 to finish in the timescales originally envisaged? 14 A. Probably when we started going into the larger sections, 15 it became self-evident it was twofold. One, we weren't 16 achieving the outputs that we were forecasting to 17 achieve, and two, we were coming across quite a lot of 18 utilities that had never been identified previously. 19 Q. When you say when we went on to the larger sections, can 20 you recall when that was? 21 A. I think from memory probably the first quarter of 2008, 22 I think. 23 Q. You also referred to the RATS works being carried out; 24 these were by their nature relatively simple areas for 25 works? 98 1 A. Yes. 2 Q. Did that mean that the front end of the contract, what 3 was being experienced was essentially the easy works and 4 more difficult ones were all being put back until the 5 design was sorted? 6 A. In essence, yes. 7 Q. If you could look, please, at your statement at page 34. 8 Looking at paragraph 103, you say here: 9 "Looking back, I would have started the design 10 probably a year earlier. There would then have been 11 a year of complete designs to work with. That way, if 12 additional services were located, the time lost would 13 never have amounted to a year. The lesson for similar 14 projects is that the utilities should be completed well 15 in advance of the tram infrastructure team commencing 16 their work. In relation to the Tram Project, the 17 contract had commenced and it was too late." 18 Dealing with firstly the design aspect of that, 19 starting the designs probably a year earlier, was it 20 just a matter of starting the designs a year earlier or 21 finding a way to expedite or sort out the problems in 22 the design process? 23 A. It's twofold. One, starting the design earlier in 24 advance, and one, ensuring that you had a fairly 25 effective process of getting the design approved and 99 1 channelled through the SUCs. Because ultimately at the 2 end of the day, what you're looking for is the design 3 that's been approved by the SUCs. Once that's there, 4 that's your design. That's you're ready to commence 5 construction. Up until that point in time, you can't 6 commence any construction works. 7 Q. Do you envisage any difficulty in getting the SUCs to 8 participate in the design decisions that much earlier? 9 A. No. It's not really -- that's not really the issue. 10 The issue is making sure that the SUCs were aware of the 11 process that we were going through to get the designs 12 approved, why we were doing it, and how we were going to 13 go about that, and giving them visibility of the level 14 of effort that we expected from them, because remember, 15 they have to input some level of effort into assessing 16 and verifying the designs are okay. 17 So it's only prudent to allow them visibility of the 18 demands that's going to be put upon them to getting 19 these various designs approved when you take account of 20 the scale of the project you're looking at. 21 Q. If you're going to carry out designs, the utility works, 22 does it follow you have also got to have the tramline 23 design itself developed to some extent, to know 24 precisely which utilities have to be moved, and which 25 areas are free of interference? 100 1 A. I think it's slightly different from that. 2 What you have, you have got to get the tram route, 3 the principal route agreed in terms of the main 4 arterials or the thoroughfare that is going through, but 5 then the actual location of the tram within the actual 6 street is slightly dictated by the availability of the 7 diversions that are available there. 8 You will not put a tram down a certain part of a 9 street when it's well known you can't move the utilities 10 in that area. So to some extent, the tram actual route 11 within the street is dictated by the available space for 12 the utility diversions. 13 Q. So is that happening in practice in Edinburgh, that 14 sometimes the utilities would influence or dictate where 15 the tram tracks had to be positioned? 16 A. I think in some cases that was the case, yes. 17 Q. Were there situations in Edinburgh where, as a result of 18 changes to the design of the tram tracks, it was 19 necessary to rework utilities, to re-divert matters? 20 A. Not that I am aware of. I think there was some 21 proposals for Leith Walk, where the councillor wanted to 22 have the tram going back and forwards so it looked good, 23 and we already said: we've already diverted the 24 utilities so that's not happening. Other than that, no, 25 I'm not aware of -- nothing comes to mind. 101 1 Q. In terms of trying to find lessons and ways things might 2 be done better, is there any -- in your view, would 3 there be any scope for trying to have a much faster 4 decision-making procedure in relation to how diversions 5 should be carried out with essentially the utilities if 6 necessary being told what is going to happen, rather 7 than being asked to agree to what is going to happen? 8 A. I would always go back to saying it's always a willing 9 horse is a better party. 10 I would say it would be prudent to set up a process 11 that all parties are fully bought into. I think that's 12 the key thing for me. Making sure that within itself 13 it's not a bureaucratic process, and it actually allows 14 design to be developed, approved quickly, but then you 15 need to have buy-in by all parties. 16 I think that would be to be the key thing, is to get 17 a process that all parties agree is the most effective 18 way of getting the designs channelled through and 19 approved. And then the other aspect is of -- is 20 actually looking at development design sooner in advance 21 of the actual construction works. Not necessarily 22 having all the design complete along the full route 23 line, but having sufficient that allows for potential 24 contingency to come across unexpected utilities, 25 unidentified utilities, and allowing for that period of 102 1 time as well. 2 Q. We talked a little bit about unexpected utilities. 3 I just want to think how that arises in practice. 4 You've explained to questions from Lord Hardie that 5 you would just leave the redundant utilities under the 6 line of the tram track and they might be removed by the 7 infrastructure contractor in due course? 8 A. Yes. 9 Q. When we talk about an unexpected utility, is that one 10 that arises while the infrastructure is -- contractor is 11 in the consideration of laying their works, they 12 suddenly realise there's a water pipe here, or an old 13 gas pipe we didn't expect? 14 A. Yes. We would assume that during the -- when you're 15 carrying out the utility diversion, that you'll come 16 across either unidentified utilities or unknown 17 utilities. Unidentified is a utility that you know what 18 it is, but it wasn't previously identified. An unknown 19 utility is one that wasn't previously identified and you 20 don't know the owner of that asset. 21 Q. I think you explain in your statement what you have got 22 to do to try and find out who owns it, and if you can't 23 find out, just do a carefully controlled cutting? 24 A. There's an approved procedure of how you terminate that 25 asset or identify what is within the asset. 103 1 Q. You refer there to finding unexpected or previously 2 unidentified utilities while carrying out the utility 3 works? 4 A. Yes. 5 Q. So does that mean that what you're doing is you're 6 finding them when you dig the hole to put the new 7 utilities in, you find something there that you didn't 8 expect? 9 A. Yes. 10 Q. There's not enough -- there's not the space you thought 11 there was going to be? 12 A. No, and then you've got to look at the design, and there 13 may be some alterations to the design required. But 14 usually they're local, as in instead of the pipe going 15 in about a metre offset from the kerb, it might go 16 a metre and a half offset from the kerb. 17 Q. But what about the situation where the unidentified 18 utility is not where you're going to put the new ones, 19 but it's underneath the tram track and it turns up 20 later. What happens about that? What happens if in the 21 course -- take a hypothetical example. There's 22 a historical gas or water main running through the tram 23 track, and it's not shown on records or more likely, on 24 the records it's not shown on that location? 25 A. I would be very surprised to not find -- for us not to 104 1 find the unidentified utility within the influence of 2 the track because that's a section of road that we are 3 clearing. That's a section of road we actually expose 4 that during the works. We actually expose that to 5 verify what services are there and what needs to be 6 diverted. 7 So I would be surprised not to find that. 8 Q. That's -- that was following on really from Lord 9 Hardie's question, that you do have to actually expose 10 the existing utilities? 11 A. Yes. 12 Q. Even if you don't have to take them out? 13 A. Within the influence of the track slab. We don't dig 14 down 2 metres or 3 metres just to see if there's 15 anything down there. 16 We had a specific depth of clearance required for 17 the track slab to ensure there was no utilities within 18 that, and that's the depth we went down to. 19 CHAIR OF THE INQUIRY: I think you said that you left 20 services belonging to Scottish Water -- 21 A. Yes. 22 CHAIR OF THE INQUIRY: -- at a certain depth because it was 23 much deeper than would influence the track. 24 A. Yes. 25 CHAIR OF THE INQUIRY: I think the negotiation there was 105 1 about giving them access to their asset by going in from 2 the side or something. 3 A. Correct. 4 MR LAKE: Well, looking at means of doing it, and you have 5 described how getting things done earlier in terms of 6 design and information, just putting to you 7 a hypothetical alternative, which is everything is done 8 at the last minute and the whole process is telescoped 9 together. So that essentially you would expose the 10 intended line for the tram track itself, see what's 11 there in the ground, and get all utilities together at 12 once to make rapid decisions about what should happen. 13 Is that feasible? 14 A. No. 15 Q. Why not? 16 A. The time period for that would be considerable. 17 Q. Where would there be a time period involved? 18 A. Well, from what you're saying, you don't have a design 19 set. You're waiting until you have exposed, you have 20 opened up the section of road, you've exposed the 21 utilities. Then you're going to decide where the 22 utilities are going. So you've still got to design it. 23 So then you've got to get the design then developed, 24 design approved, then you could commence what you're 25 going to be doing. 106 1 All the while this road is left open, whereas the 2 period -- if you do the design in advance, you're only 3 actually opening the road as and when you're ready to do 4 the diversion. 5 Q. Unless you have to do all the excavation trenches first 6 to try and find out what's actually in the ground? 7 A. If you were going to be doing that, you would be doing 8 the infrastructure and the civils construction together 9 then. 10 CHAIR OF THE INQUIRY: What are the advantages or 11 disadvantages of that and doing the diversion and 12 infrastructure contract at the same time? 13 A. Well, the advantages are that probably you would be able 14 to identify all the utilities once you've exposed 15 everything there and then, and then you're diverting 16 them. But then the disadvantages totally outweigh it, 17 because the time period that you're going to have this 18 section that's going to be opened and you're going to 19 have the civils contractor standing waiting whilst the 20 diversions are ongoing, unless you've got a section in 21 advance of the utilities have been diverted and then 22 you've got a follow on, it just wouldn't be an efficient 23 way of doing it. 24 CHAIR OF THE INQUIRY: Would it not work if there was -- the 25 civils contractor was an approved contractor for 107 1 diverting utilities as well? Presumably Infraco must 2 have been, were they? 3 A. It would help, but you have still got that problem. 4 You've got a prolongation of the programme because 5 you're actually commencing the construction works before 6 you've even designed. You're actually opening up the 7 road, looking what you have got, then designing it. So 8 you've got a period effectively where nothing is 9 happening; it can't because you haven't got the design. 10 So you have opened up the section of roadway. 11 You're looking at utilities. You are then going to 12 determine what the design is. You are going to get the 13 design approved, and only once it's approved, then can 14 you then commence the actual diversions. 15 So you've got that period of start of the design to 16 approval of the design where nothing is happening. 17 Okay, you could maybe have a -- fairly -- a slick 18 operation where you get approvals done quickly, but you 19 have still got this period where nothing is actually 20 produced effectively on the ground. 21 CHAIR OF THE INQUIRY: But if you had the design in place, 22 so you actually do the design, what would be the 23 advantages and disadvantages of the one contractor doing 24 everything? 25 A. No real disadvantage, other than if something had gone 108 1 wrong with the contractor, then it's not only your 2 utilities diversion that has suffered. The civils 3 suffers. 4 But nothing really. You're removing an interface 5 where you've got the one contractor dealing with it all. 6 CHAIR OF THE INQUIRY: Thank you. 7 MR LAKE: Now, going back to something which again touches 8 upon, I think, the matter we considered when looking at 9 extensions of time earlier, I would like you to look at 10 another production, please. It's CAR00000145. 11 We can see from the cover page of this that it's an 12 agreement between tie Ltd and Carillion Utility Services 13 Limited relating to the Edinburgh Tram Network. If we 14 look at page 7, we can see on this version, although it 15 records it's been signed in 2009, we don't have the 16 precise date on which it was signed. 17 I think this is the Agreement sometimes referred to 18 as the Exit Agreement for Carillion. Were you involved 19 in drafting this at all? 20 A. No. 21 Q. In terms of the Agreement, an extension of time is 22 granted until December 2009 for the completion of the 23 utility works. Once again, it might be said that the 24 fact that this extension of time is granted to 25 December 2009 is indicative that there were no failings 109 1 on the part of Carillion and that their works were 2 unduly extended by the fact there were more utilities 3 than thought, and there were late designs and so on and 4 so forth. And traffic management issues. Again, would 5 you comment on that? 6 A. As I said previously, they were entitled to extension of 7 time based upon the increase in quantity of utilities, 8 and I think the extension of time should have been 9 proportionate to the increase in utilities. So there is 10 a -- they do have an entitlement under the contract. 11 Whether it took it to December 2009 or not, 12 I can't -- I can't say. I'm not party to this Agreement 13 at all. 14 Q. You can take it from me this Agreement said that 15 Carillion were to complete the remainder of the utility 16 works that were still assigned to them by December 2009 17 and extend the time to December 2009. This Agreement 18 would have the effect that Carillion would finish on 19 time, the extension of time covered all the works they 20 were going to do? 21 A. Yes. 22 Q. So it didn't produce any situation in which the works 23 ran beyond the time that Carillion were being given, by 24 way of an extension to time. 25 A. Mm-hm. 110 1 Q. So Carillion would say that means that ultimately tie 2 accepted that an extension was just necessary to finish 3 all their works. 4 A. I think there's as I said previously, it's a twofold 5 thing. One, under the contract, they have an 6 entitlement which recognises that increase in quantity 7 of utilities. What it doesn't recognise is the 8 inefficiencies of Carillion. Just because they have got 9 entitlement to a period, it doesn't obviate their 10 responsibilities under the contract to mitigate delays 11 in terms of their production, and as we say, it's a matter 12 of record for us that we identified they were 13 under-resourced, they weren't supervised properly, and 14 they didn't plan the works effectively. 15 MR LAKE: Thank you, Mr Barclay. 16 My Lord, those are the only questions for 17 Mr Barclay. 18 CHAIR OF THE INQUIRY: I think, Mr Fairley, you have given 19 notice that you might have some questions. 20 MR FAIRLEY: I don't think I did, my Lord, in relation to 21 this witness. But I may be mistaken. 22 MR BROOME: My Lord, it may have been me, Mr Broome, to the 23 far end here. I did give notice of questions, but I am 24 very grateful to learned Counsel to the Inquiry for his 25 careful examination of the witness and the fair way he 111 1 has put the questions and I don't consider that I need 2 to explore matters further with this witness. 3 CHAIR OF THE INQUIRY: Did you also give notice about 4 Mr Malkin? 5 MR BROOME: I didn't give any notice in relation to 6 Mr Malkin. 7 CHAIR OF THE INQUIRY: I think we got something from 8 Beltrami about Mr Barclay and Mr Malkin, but if you 9 don't have any questions, that's fine. 10 Thank you very much, Mr Barclay. That's the end of 11 your evidence. 12 You're still technically -- you're still under 13 citation, and technically we could recall you if 14 something arose. Hopefully that won't be necessary. 15 Thank you very much for your attendance. You will be 16 shown out. Thank you very much. 17 A. Thank you. 18 (The witness withdrew) 112 1 INDEX 2 PAGE 3 MR GRAEME BARCLAY (sworn) ............................1 4 5 Examination by MR LAKE ........................1 6 7 MR ANDREW MALKIN (sworn) ...........................113 8 9 Examination by MR LAKE ......................113 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 201