SIC ‘unlikely’ to seek insurance payout over bridge fiasco

It is “unlikely” that the SIC will submit an insurance claim to claw back some of the millions of pounds in compensation it paid to Lerwick Port Authority last month relating to the Bressay bridge fiasco.

Last month the council resolved its long-running dispute with the LPA by stumping up £4.8 million to redress losses the port authority incurred when the council’s actions forced it to temporarily abandon plans to dredge Lerwick Harbour.

Chief executive Alistair Buchan is compiling a report on “lessons to be learned” from the debacle ensuing from the SIC’s aborted plans for a bridge across the harbour.

When the settlement was announced last month, the council said outside legal advice made clear there was no individual error and so the payout was not covered by its insurance. But councillor Jonathan Wills contends that errors were made by staff, meaning he thinks putting in a claim could still be worthwhile.

Dr Wills’ attempt to get his list of questions discussed by councillors at this week’s Full Council meeting was thwarted. Afterwards, Dr Wills said Lord Reed’s 2007 judgement showed “very clearly that there was at least an error or inadvertent omission” by officials.

That related to advice given to councillors that an agreement existed between the council and port authority regarding the dimensions of the bridge the SIC wished to build. Lord Reed stated: “There was in fact no formal agreement.”

But Mr Buchan told The Shetland Times that the council’s external lawyers were well aware of Lord Reed’s findings when they dished out legal advice on the matter.

Asked whether he could envisage recommending that councillors consider submitting an insurance claim after all, he replied: “I think that’s unlikely, but until my report is complete it would be wrong to rule anything in and anything out. I will do a completely impartial report for the council on this matter, as it has to be, and with lessons learned for the future.”

A row briefly erupted in Lerwick Town Hall on Wednesday after Dr Wills was told the 16 questions he submitted in advance to political leader Josie Simpson were “technically incompetent” and “not relevant” to that day’s business.

Mr Simpson said he had dealt with the questions in a confidential email reply, but Dr Wills claimed shutting off debate of the “foolhardy escapade” was “absurd, patronising and offensive”.

Dr Wills’ questions concern the role played by the council’s senior officials, lawyers and politicians in the decision-making chain leading to the fateful decision to seek an interim interdict forcing the LPA to halt its dredging work.

The outspoken Lerwick South councillor insists he has no interest in conducting a “witch hunt” and just wants to know whether some of the £4.8 million could yet be clawed back.

“It may be inadvertent, not malevolence or incompetence, but all it needs to be is an error or omission and the council’s insurance is valid,” Dr Wills said. “I am not interested in which member of staff it was, what I am interested in is why didn’t we make an insurance claim?

“There’s no need to haul individual members of staff out into the public gaze – the point is not a witch hunt. It’s about a very large insurance claim, which could considerably reduce the council’s current financial plight.”

The SIC had already parted with £2.2 million on its plans for a bridge to Bressay. It then ditched that idea in favour of investigating the option of subsea tunnels to connect Bressay and other islands to the Shetland Mainland.

February’s LPA settlement prompted opposition councillors and both Shetland’s parliamentarians to demand a full internal investigation to give the public answers as to how the money came to be wasted.

At a press briefing to announce the settlement last month, Mr Simpson said he did not believe there was “anybody at fault”.