News / SIC/HIAL reach runway settlement
COUNCIL leaders in Shetland have welcomed an out of court settlement with Sumburgh airport operator HIAL which will see the local authority pay a reported £5.5 million to the government-owned company.
Highlands and Islands Airport Limited had initially been seeking £14 million in damages from the SIC for poor workmanship on the 2005 runway extension at Sumburgh.
HIAL had always claimed that the SIC was responsible for the poor standards of the engineering work at the £10 million extension, leading its eastern end to crumble in the face of heavy winter seas.
In 2013, the Scottish government made £12 million available for HIAL to carry out urgent repairs to the runway extension.
When visiting the isles in summer of that year, then first minister Alex Salmond also urged both sides to settle out of court.
On Thursday, it emerged that the independent mediation process had finally been successful.
SIC council leader Gary Robinson said everyone was pleased that the legal dispute was over.
“At the end of the day we have a functioning airport which is absolutely critical for the social and economic needs of the islands. That is the real positive for Shetland,” he said.
He added that the HIAL/SIC partnership agreement for the runway extension happened at a time when the SIC governance “wasn’t where it should have been”.
He said he was confident that following the Audit Scotland inquiry of 2010 and the subsequent changes to the local authority “something like this shouldn’t be able to happen again”.
The £5.5 million will be paid from the council’s reserves.
In a statement, HIAL’s managing director Inglis Lyon said: “We are satisfied this long running matter has finally been resolved and that an acceptable settlement has been reached.
“Our focus is firmly on moving forward with our plans for continued investment in Sumburgh Airport that will help ensure Shetland’s connectivity and future prosperity.”
SIC chief executive Mark Boden added: “The runway extension is a valuable facility for residents and businesses in Shetland. It has been a great success.
“It was unfortunate that further works were required but I am pleased that we have been able to agree a mutually satisfactory way forward.”
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