Scottish Futures Trust
22 May 2008 11:26 AM
The Scottish Government recently announced its way forward for infrastructure investment in Scotland to secure new schools, hospitals and transport projects at better value to the public purse.
Ministers published the strategic business case for the Scottish Futures Trust initiative to be supported by a new company established in the public sector.
The new company will aim to:
* release up to £150m each year for increased investment in infrastructure through greater partnership, improved preparation and handling of projects, and better value finance - including the non-profit distribution model
* bring together the expertise to enable a Scotland-wide municipal bond to fund future infrastructure projects
* provide opportunities for increased investment in Scotland's vital public service infrastructure - including schools, hospitals and transport projects
* learn the lessons from previous PFI contracts to reduce the cost of funding and deliver more effective investment planning, procurement and delivery
At the Infrastructure Investment in Scotland conference at Heriot-Watt University, First Minister Alex Salmond said:
"Scotland has a proud record of delivering new and innovative approaches to public investment. The development of the Scottish Futures Trust is the way forward, offering both better value finance and secure investment.
"It is right for Scotland, right for our public services, and right for our times. By releasing up to £150 million each year for increased investment, we can ensure more resources for our public infrastructure compared to wasteful PFI."
Finance Secretary John Swinney said:
"We will establish a new company in the public sector to provide the schools, hospitals and transport infrastructure that Scotland needs, in a far more cost effective way.
"By putting non-profit distributing principles (NPD) at the core of partnership delivery and funding, we have already removed the element of PFI that delivered the most extreme profits, and a Scotland-wide municipal bond opens up the prospect of further benefits.
"The Scottish Futures Trust company will support public bodies in delivering more cost effective infrastructure for taxpayers. It means we will get more for our money - more bang for the people's bucks.
"With an infrastructure investment programme of some £35 billion over the next 10 years, SFT will be central to this Government's purpose of increasing sustainable, economic growth."
Professor John Kay, a Fellow of St John's College, Oxford, Visiting Professor of Economics at the London School of Economics, and a member of the Council of Economic Advisers, said:
"PFI is well past its sell by date. The Scottish Futures Trust can achieve its three objectives of cheaper finance, better project management and the operation of infrastructure projects for the benefit of the people of Scotland."
SFT will be formed this summer and work with the public sector and market.
Its objectives are:
* To create a consistent Infrastructure Investment Plan based on ten-year investment strategies
* To optimise investment under the Prudential Code using new techniques such as future modelling, tax increment funding and developer contributions
* To form at least two 'community hubs', including primary/community care facilities
* To support the Scottish Funding Council in developing delivery and funding strategies for the Higher / Further Education sector
* To develop an approach under the 'Firm Foundations' policy to lever in more private sector investment into housing
* To develop an asset-based investment fund to support community regeneration
* To examine scope to reduce the cost of existing PFI contracts. SFT will have an important role to play in applying across the infrastructure landscape lessons in 'best practice'
* To assist public sector to produce national strategies for the delivery and funding of schools, housing, waste and flood prevention investment
* To provide expert support for Gateway Reviews
* To advise Scottish Government and liaise with the market on strategic aspects of infrastructure investment, particularly market issues and capacityRelated Information