IT has emerged that Carillion has pulled out of the race to win the construction contract for the Borders Railway, potentially leaving only one group bidding for the project.
The move by construction giant Carillion could leave a sole group bidding for the £230 million order to build and maintain the line – the longest new route in Britain.
It comes seven months after one of the other two shortlisted consortia for the project quit the contest following the loss of a key member – American rail firm Fluor.
It is the latest in a string of setbacks for the £295m project to reopen a 30-mile stretch of the former Waverley line from Edinburgh to Tweedbank, south of Galashiels.
The planned opening of the route has already been delayed by three years to 2014, which has been blamed on the poor economic climate.
Ministers had also previously promised work would start before last month’s Holyrood election, but it will now not get underway until this winter.
Commenting on the news, Borders MSP John Lamont said: “This is clearly very worrying news and could lead to the cost of this project increasing yet again. Ultimately this extra cost will fall to the taxpayer.
“Many local residents have expressed concerns to me about the viability of this project and fear that it is taking resources away from other public transport, like investment in roads and bus services.
“The news that another contractor is considering withdrawing must suggest that the bidders have concerns about the viability of the Borders Railway too.”
However, the Campaign for Borders Rail (CBR) reman confident that the project will go ahead.
CBR chair, Lorne Annton, said: “Following the news that Carrillion are withdrawing from the IMCD Consortium, tendering for the Borders Railway Contract, the Campaign for Borders Rail (CBR) welcomes the Transport Scotland statement that works will be underway in the winter of 2011 with passenger services running by 2014.
“Changes to consortia make up are not uncommon on contracts of this size and despite the Carillion withdrawal the IMCD Consortium still have to state their position and a replacement for Carillion could be found.
“CBR fully support the funding method proposed by the Scottish Government and Transport Scotland and their attempts to reduce rail construction and maintenance costs which is in line with the recently published McNulty Report.
“Recently completed Scottish contracts such as the M74 extension and the Airdrie – Bathgate Rail Link have been completed on time and under budget. Recent rail line and station re-openings in Scotland have all been a huge success with passenger numbers far out-stripping predicted, business case, usage.
“On June 9, Keith Brown, Minister for Housing and Transport, wrote to CBR stating that the Scottish Government is determined to ensure that for the first time in over 40 years, people living in the Borders and Lothians can benefit from a direct rail link connecting the regions to the capital and the Scottish rail network.
“CBR are are confident that this commitment will deliver by 2014 and the people of the Borders and the Borders economy will begin to enjoy the huge advantages the rail link will bring.”
Labour’s Shadow cabinet secretary for infrastructure and capital investment, Lewis Macdonald MSP, said the news was “a major blow” for the project.
Mr Macdonald added: “The more bidders you have got the more chance you have got of getting value for taxpayers’ money, so to lose yet another bidder is a real setback.
“Rail infrastructure operation firms don’t come ten-a-penny so these are worrying developments for all those who hoped to benefit from the new service.
“The Scottish Government must make clear how it plans to get the project back on track.”
Liberal Democrat transport spokesman Jim Hume said: “We need clarity over where this latest development leaves the project.
“This project is vital for the Borders and the SNP has a responsibility to ensure that it is delivered on time.”