Scottish Government - Capital Investment

20th September 2011

A targeted capital investment programme worth around £9 billion over the next three years will create and support thousands of jobs, boosting Scotland's economy, Alex Neil said today.

Commenting on today's Spending Review the Cabinet Secretary for Infrastructure and Capital Investment welcomed the decision to switch over three quarters of a billion pounds from resource expenditure to support the capital programme from this year to 2014-15.

The Scottish Spending Review 2011, confirms that despite a 36.7 per cent real terms cut to Scotland's capital budget in the UK spending review, Government-supported investment will grow over the next three years.

Other key points from today's spending review for Infrastructure and Capital Investment include:

Funding for the Forth Replacement Crossing and other major projects across a range of portfolios, such as the new Southern General Hospital, Glasgow, in Health and the V&A in Dundee in Culture.

Up to £6 billion to spend on our transport infrastructure and services, including the Edinburgh Glasgow Rail Improvements Programme, the M8 Baillieston to Newhouse and associated works project, major improvements on the A82 at Pulpit Rock and Crianlarich as well as Glasgow Fastlink and smaller investments such as the A96 Inveramsay Bridge. The spending review also makes provision for the Aberdeen Bypass, which Ministers want to progress as soon as possible, and the Borders Railway project.
Sufficient funding over the next three years to deliver the Scottish Government's target of 30,000 affordable homes over the life of this Parliament.

Investment (£327 million) to tackle fuel poverty head on and support housing quality by maintaining the successful Energy Assistance Package and Universal Home Insulation Scheme, including extending the EAP to carers and in meeting our contractual commitments to housing stock transfer landlords.

* And meeting the Scottish Government's commitment to establish a Warm Homes Fund, a Next Generation Digital Fund and a Future Transport Fund as part of the Scottish Futures Fund.

On top of the traditional capital programme, massive additional funding will be secured through a pipeline of infrastructure projects worth £2.5 billion, which will be delivered through the Non Profit Distributing model. This system secures private sector investment, but caps the excessive profits that previous PFI schemes generated at the expense of Scottish taxpayers.

Mr Neil said:"A key foundation stone of this Government's Economic Strategy is delivering targeted capital investment to create and protect jobs and stimulate growth.

"Today's Scottish Budget delivers on that commitment by funding a substantial infrastructure programme that is carefully targeted to deliver the projects that will make the most difference for the economy and our communities. In particular, our capital budget will benefit substantially from the decision to switch over three quarters of a billion pounds from resource expenditure to support the capital programme from this year to 2014-15.

"On top of traditional capital investment, we will lever in substantial further funding through a £2.5 billion pipeline of projects delivered through the non-profit distributing model, which will protect Scottish taxpayers from the obscene profits and huge costs associated with the discredited PFI model of investment.

"Taken together, that means Government-supported investment will grow over the next three years, despite savage cuts in our capital budget from Westminster.

"Overall, our investment will mean funding a new Forth Replacement Crossing. It will mean meeting our commitment to deliver 30,000 affordable homes over the life of this Parliament. And it will mean a significant investment in our transport network, with key projects such as the Aberdeen Bypass, Borders Railway, and the Edinburgh Glasgow Rail Improvements all supported.

"Westminster's cuts mean we have had to stretch our expenditure as far as possible in this portfolio - ensuring we deliver against our commitments by providing maximum value for money for the taxpayers. To do so, we are using every policy lever at our disposal to deliver maximum investment, including the National Housing Trust and Tax Incremental Financing.

"Later this Autumn we will publish our Infrastructure Investment Plan, which will build on the capital investment programme set out in the spending review, and include details of the projects we will take forward over the next ten years."