SFT Boosts Scottish Economy
Scottish Futures Trust announced on 28 June 2011 it had delivered £129m of net future benefit to infrastructure investment in Scotland during the 2010-2011 financial year. This is a 16% increase on last year’s £111m.
One year on from the Independent Budget Review, which called for the role of SFT to be enhanced, the company continues to build on the solid performance of last year and continues to rally organisations in the public sector to work together to reap the benefits for Scotland. The hub initiative is an example of this work and already progress can be seen on the ground at its Drumbrae build, which comprises a library, day care centre and community hub. The hub initiative consists of five community partnerships across Scotland, three of which are already up and running, and will deliver more than £1bn of infrastructure over 10 years. Hub, along with other SFT initiatives, will protect in excess of 7,000 construction jobs in Scotland.
In 2010/11, SFT started two significant new activities in conjunction with other public sector partners. These relate to delivery of the £2.5bn Non Profit Distributing (NPD) programme and cross public-sector asset management. In times of capital scarcity, the £2.5bn revenue funding programme, one of the biggest of its kind in Europe, will allow Scotland to secure vital improvements to essential public infrastructure which would have otherwise been deferred for several years.
In relation to housing, SFT has made much progress with its innovative National Housing Trust initiative to provide affordable housing at a time when traditional budgets are being squeezed. Under the initiative SFT has worked closely with both the public and private sectors and will initially deliver up to £100m of affordable homes across Scotland. Homes that would not have be built if it were not for the National Housing Trust initiative.
SFT leads the UK with its Tax Incremental Financing (TIF), which will unlock infrastructure for major regeneration schemes in Scotland. There will be up to six TIF pilot projects in Scotland, with three already announced: the Edinburgh Waterfront Development; the Buchanan Quarter in Glasgow; and Ravenscraig. It is estimated that the first three pilots will bring c.£250m of public sector investment and further unlock more than £1.5bn of private sector investment.
Taken together, NPD, Tax Incremental Financing and the National Housing Trust, unlock a total of £3bn in investment for Scotland. This £3bn is additional investment over and above capital budgets, which will allow vital investment in infrastructure to continue. The additional investment programme will allow schools, colleges, hospitals and roads to be built that would otherwise have to wait many years before construction could start.
Sir Angus Grossart, chairman of SFT, said: "This statement, independently verified, is clear evidence of what we are already achieving. SFT is currently managing and supporting a portfolio of £9bn projects across Scotland. The increase, from £5.5bn in 2010-2011, demonstrates the recognition by Scotland’s public sector bodies of SFT’s expertise and how SFT can help them to achieve greater value for money. Such expertise was often repurchased on a project-by-project basis from consultants before SFT was formed was, so retaining this knowledge is bringing further savings. I remain confident that SFT will continue to add further benefits and savings for the Scottish taxpayer by improving value for money and developing innovative ways in finance infrastructure."
Barry White, Chief Executive of SFT, said: "I am delighted to have worked with organisations across the Scottish public sector to deliver £129m of net benefits and savings to the taxpayer. These figures demonstrate the potential that robust challenge and commercial expertise can bring to future infrastructure investment across Scotland. It is our job to make the public pound stretch further in these extremely challenging times. In schools, for example, through our £1.25bn Schools for the Future programme, by focusing on needs and not wants, we can deliver five schools for the price of four. The programme will deliver 55 high-quality sustainable schools across all local authority areas. Four primary schools are already on site and the first secondary school is scheduled to be completed by 2013."
