The City of Edinburgh Council is set to fork out some £2m on an inquiry into what went wrong with the chaotic delivery of the city’s tram system.
Edinburgh trams began operating on 31 May last year after running three years late and more than £200m over budget.
The taxpayer’s cash has been set aside to cover costs including administration and legal fees, although the authority has refused suggestions from inquiry chairman Lord Hardie to revive its arm's length tram delivery firm Transport Initiatives Edinburgh (TIE).
In a bid to cut costs the authority said it would not be ‘in the public interest’ and would entail further costs that could rise to £4m.
TIE operated from 2002 until 2011 as an arm’s length company and was ultimately owned by the Council before it was closed down.
Edinburgh has made it clear that it will pay for independent legal advice for current and former employees and elected members for the inquiry but will not pay the legal costs of former TIE employees.
A council spokeswoman said no staff were brought from the council to TIE and so its employees were not entitled to legal support.
Council leader, Andrew Burns, said: ‘The council continues to support the inquiry, as it has done throughout, and to be fully open and accountable. By applying to be a core participant we have committed to playing our part in the proceedings and co-operating fully with the Inquiry.
'However, we do not believe that the considerable cost of reviving for the sake of the Inquiry is a justifiable expense; one which would ultimately be borne by the Edinburgh taxpayer.
'The council is the ultimate parent body of tie, and we have communicated our willingness to provide information about its role to the Inquiry.’
First minister at the time, Alex Salmond, announced there would be an inquiry into the project in June 2014, and it has been awarded statutory powers to compel witnesses to participate.
The inquiry itself declined to comment. The preliminary hearing begins on Wednesday of next week.
There are no current figures on how much the inquiry could cost in total.
An inquiry spokesperson said: 'Funding for this independent inquiry is coming from the Scottish Government. The Scottish ministers have been clear from the start that the Inquiry should be efficient and cost effective. All efforts will be made to ensure the Inquiry delivers best value for the public purse.'