The Scottish Labour Party proved the extent of its internal disarray yesterday when it approved the coalition deal between the SNP and Labour groups on Edinburgh Council less than 24 hours after banning it.

Labour’s Scottish Executive had met on Wednesday night and stopped the party’s 12 members on the council from joining with the 19-strong SNP group to re-form the Capital Coalition that has run Scotland's second largest local authority since 2012.

The National understands that a powerful intervention from Labour group leader Cammy Day was instrumental in forcing the change of heart by the Executive.

Labour’s policies on coalitions since the elections on May 4 has been all over the place - Labour leader Kezia Dugdale suspended the party’s councillors in Aberdeen for joining with the Tories to form a coalition, but in other authorities such as West Lothian and Midlothian, behind-the-scenes deals with Conservative groups have been allowed.

The Executive had also approved several SNP-Labour coalition deals elsewhere, so the delay over Edinburgh’s deal is mystifying except that several Labour activists locally and at least four councillors and one parliamentarian had objected to it.

With 31 of 63 seats, the coalition will still be short of an overall majority but The National understands that the Scottish Greens with their eight members will not object to the formation of the coalition.

After that, it is extremely unlikely that the Greens, the 18 Tories and six Liberal Democrat councilors will vote en bloc on many issues, if any at all. Criticism of the deal by the Unionist parties is anticipated, however.

One SNP source said: “Given that on a UK basis, the Tories are depending on a coalition of sorts with the Democratic Unionists, and we all know what they stand for, to ensure their survival in Westminster, they are going to have a hard time arguing against this local arrangement in Edinburgh.”

A statement issued by the council late last night after The National went to press said the SNP and Labour “have formed a new coalition to run the City of Edinburgh Council, pledging to deliver improved services for residents and communities over the next five years.”

The statement added: “Following detailed negotiations, the coalition partners have committed to working closely with other groups to achieve the best possible outcomes for Edinburgh residents.”

SNP Group leader Councillor Adam McVey and Labour’s Cammy Day will sign the coalition agreement today focusing on several key areas, including the construction of 20,000 affordable new homes, investment in transport infrastructure, improving waste services and roads maintenance and the delivery of a City Region Deal.

The coalition will also target educational attainment, building two new secondary schools and ten new primaries by 2021.

Most controversially, the coalition will also support the extension of Edinburgh’s trams to Newhaven if the case for it can be proven to be robust.  

Adam McVey said: “I am pleased that we have been able to reach this agreement, which will provide stable leadership for the Council moving forward. This administration will implement a progressive policy agenda which will have as our top priority the improvement of our core public services and dealing with the key issues that face the people of our Capital.

“As the city’s youngest ever Council leader, I’m keen to bring a new vision to our exciting and vibrant Capital. The SNP and Labour teams are ready to get to work for the city bringing an energetic, determined approach to address Edinburgh’s needs.”

 Cammy Day said: “Labour and the SNP can offer the strong partnership required to lead the Council, and we look forward to working together and putting Edinburgh first. 

“Our vision has always been to progress projects and policies which benefit the citizens of Edinburgh and we will continue this throughout our term of office, working with our trade union colleagues and devolving decision-making to local communities as far as possible. I call on the Greens to join and support our vision of how we can unleash our city’s potential.”

Council Chief Executive, Andrew Kerr, said: “I would like to take this opportunity to welcome the new leaders of the City of Edinburgh Council. I look forward to working with them over the next five years to achieve the best for the people of Edinburgh, and to achieve our vision for the Capital as a city of the future.”

Committee conveners will be appointed at a meeting of Council next Thursday. In order to meet legal requirements, members of the Council’s planning and regulatory committees, boards and joint boards were appointed at the first meeting of the new council on May 25.