Scots save big projects despite 36% budget cut

Aaron Morby 14 years ago
Share

Scotland’s Government has saved the Replacement Forth Crossing along with major health and education schemes despite savage cuts to capital projects over the next four years.

Finance Secretary John Swinney said Scotland would have £3.3bn less to spend over the next four years after the spending review dictated an 11% budget cut.

For construction this will mean a £1.2bn fall in the capital budget – “a staggering 36%”. He warned that the scale of cut was unprecedented and would inevitably slow the pace of implementation of the Government’s infrastructure programme.

Swinney said spending on capital projects would be sustained, by moving £100m from this year’s budget, and plans were still on track for constructing the replacement for the Forth Road Bridge, which is budgeted to spend £200m next year.

The Scottish Government said it would use alternative funding routes to help fill the yawning gap in project spending.

This includes taking forward a new pipeline of revenue financed investment worth up to £2.5bn, to be delivered through a Non-Profit Distributing model.

Scotland is also banking on innovative measures such as Tax Increment Financing, the National Housing Trust and investment through the Scottish Joint European Support for Sustainable Investment in City Areas fund to help fill the gap.

Secure major projects

  • Construction of the new Forth Crossing. Work on £1.7bn -£2.3bn project will begin in 2011-12 to ensure that the new crossing is operational by 2017
  • South Glasgow Hospitals – an £842m investment to upgrade and expand the capacity for adult and children’s hospital care in Glasgow and the West of Scotland
  • Scotland’s Schools for the Future building programme. In partnership with local authorities, this programme will invest £1.25bn to improve Scotland’s schools estate.
  • Capital spending cuts

    Funding for the prison service is one of the biggest losers in the budget, facing a 22% cut while housing will see a cut of 19.3% in the next year.

    There will be less money for rail and motorway services, and the axe has also fallen on the education budget with a 12% cut to colleges and universities.

    Swinney told the Scottish Parliament that funding for the maintenance of the motorway and trunk road network “has been reduced”.

    “This decision has been difficult and will have an impact and I make no claims to the contrary,” he said.

    The budget document shows a cut in network strengthening and improvement cash from £56.4m this year to £15m next year, while the budget for other road improvements is cut from £49.7m to £24.2m.

    The draft budget states: “In order to reduce the level of spending within housing and regeneration, we have taken the following difficult decisions: to re-profile some housing and regeneration capital spending; and to focus the support available to those affected by the economic downturn.”

    It pledges to use £50m from the JESSICA fund to help provide new affordable homes in disadvantaged areas and expand on its National Housing Trust initiative to kick-start projects that have stalled because of the recession.

    The new pipeline of NPD investment will help support key projects across core public services, including:

    The projects that will be taken forward by the Scottish Futures Trust, using a non profit distributing model of the private finance initiative. This will be delivered in partnership with the Scottish Government, local government, NHS Boards and other public bodies.

      Major transport projects with a capital value of £1bn

    • Borders Railway project (£230-£290m)
    • M8 Baillieston to Newhouse, M74 Raith Junction and M8, M73 and M74 network improvements (£320m)
    • Aberdeen Western Peripheral Route and A90 Balmedie (£350-£450m)

    Education projects with a capital value up to £750m

  • Specific projects within Scotland’s Schools for the Future programme, subject to the agreement of local authorities (£400-£500m)
  • improvements to the further education college estate at Kilmarnock and Inverness (£100m); and
  • modernisation of the Glasgow college estate, subject to the conclusion of a robust and affordable business case (£200m)
  • Health projects with a capital value up to £750m

  • Royal Sick Children’s Hospital and Department of Clinical Neurosciences in Edinburgh (£250m)
  • Revenue support to finance projects through the hub initiative (£200m)
  • Individual hospital projects, health centres and mental health facilities across Scotland (up to £300m)
  • Latest news

    26 face fight to renew spots on £1bn NEPO civils deal

    Next generation framework to start in March 2025
    6 hours ago

    Go-ahead for £170m King’s Cross life sciences office project

    Innovative arched design to carry landmark building over railway tunnels
    7 hours ago

    Mitie buys power contractor ESM for £8.5m

    Building FM firm strengthens high voltage contracting offer
    6 hours ago

    New vision unveiled for £5bn Liverpool Waters

    More housing included in central docks area after Labour £55m funding boost
    15 hours ago

    String of contract wins sees turnover surge 25% at Mace

    Construction division sees revenue leap to £1.73bn
    7 hours ago

    Morgan Sindall wins £32m Walsall waste centre

    Contract will transform former metal factory site
    7 hours ago

    Kier wins £30m Greenwich teaching block

    London South East Colleges plans to spend £47m on Greenwich Campus redevelopment
    17 hours ago

    Blenheim House Construction applies for administration

    Surrey contractor employs around 80 staff generating £87m turnover
    1 day ago

    GMI chief jumps to Henry Boot Construction

    Lee Powell will replace Tony Shaw as MD when he leaves at the end of 2024
    1 day ago

    Avant Homes makes £109m loss

    House builder reveals huge loss just days after entering Crest Nicholson bid race
    2 days ago

    Greggs unveils plans for giant distribution centre

    Bakery giant to build 311,551 sq ft logistics centre in Kettering
    1 day ago

    £330m south east London 1,250 homes scheme approved

    Outline planning for New Belvedere development near the Thames
    1 day ago

    Green light for Birmingham 1,200-bed student scheme

    Cambrian Wharf project will rise to 14 and 35 storeys
    1 day ago

    Welsh fit-out specialist files administration notice

    £30m turnover employee-owned Paramount D&B lodges court notice
    2 days ago

    Skanska signs £105m London Millbank office rebuild

    Original 1915 building facade will be dismantled and rebuilt
    2 days ago

    Historic facade contractor goes into administration

    Administrator seeking buyer for Charles Henshaw & Sons
    5 days ago

    Three-year HS2 station box excavation completed

    Enough clay to fill 300 Olympic sized swimming pools removed from Old Oak Common site
    2 days ago

    BAM starts £88m Fife passivhaus school job

    1,800-pupil school will be built near Rosyth Docks
    2 days ago

    Torsion appoints new Chief Operating Officer

    David Worsley promoted as leadership team shuffled at Leeds based firm
    2 days ago

    Tilbury Douglas site manager saves schoolboy’s life

    Site manager carries collapsed schoolboy to resuscitation unit he helped build
    5 days ago

    Extra HS2 payment sees SCS contract jump to £4.24bn

    Skanska Costain Strabag JV additional payments rise to £650m after third handout
    2 days ago

    Plans lodged for 3,300-home Salford tower cluster

    £1bn Regent Park scheme includes UK's third tallest building at 70 storeys
    6 days ago

    Domis founder Lee McCarren steps down

    Fellow director Kingsley Thornton takes helm as co-founder retires
    5 days ago

    Spencer lands civils package on £300m energy plant

    Subcontract worth £23m on pioneering Manchester green energy storage scheme
    5 days ago

    Van Elle and M&J Evans team-up for housing works

    Piling and groundworks specialist start new collaboration deal
    5 days ago

    Muse JV closes Wolverhampton City Centre West quarter deal

    English Cities Fund completes council partner deal for 1,000-home plan
    5 days ago

    Ofwat approves £88bn AMP8 water spending spree

    Spending on infrastructure ringfenced, unspent funds returned to customers
    6 days ago

    ‘Bellingham Bridge’ takes shape on HS2 in Birmingham

    Watch work on four huge piers for bridge named after England superstar
    6 days ago

    Construction swings from weakest to strongest sector

    Construction output rebounds by 1.9% in May after three months of decline
    6 days ago

    Costain appoints new commercial director

    Paul Morris takes over from David Taylor
    6 days ago

    Contractor services