Passionate speeches in favour of the tram from executive member for regeneration Peter Millea and executive member for community safety Richard Marbrow convinced the party to back the scheme.
Cllr Millea, who is also a member of Merseytravel, said: "Over the last few months we have had our differences with the officers but, to be fair to them, it is their role to be cautious.
"We value that, and they are there to protect our interests. They pointed out the risks and they have their interpretation of those and we have our own.
"As a group we have decided to take the risk of underwriting a contingency which may never be needed anyway.
"The officers made it clear that we could not agree to anything more than the £24m contingency and we never intended to do that anyway.
"It would have scuppered the tram if Liverpool and Knowsley were asked to pay more than the £24m and quite rightly Merseytravel did not ask us to do that."
Cllr Millea urged the Government to release the £170m it has promised to Merseytram once the contingency is formally approved on Friday.
He said: "The ball is now firmly in the Government's court. We have shown we meant what we said all along and that is we want this project to go ahead.
"There is no more we can do; it is now up to the Govern-ment."
Rail Minister Derek Twigg, MP for Halton, yesterday appeared rather more optimistic than last week, when he had warned all parties a conclusion had to be reached soon.
Mr Twigg said: "We all want to be sensible about this. We have almost reached agreement and I fully understand that this scheme is of vital importance to Merseyside."
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