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Financing model consigned to history

04/10/2011

The Scottish Government is committed to a new financing model that has replaced the discredited Private Finance Initiative (PFI), Alex Neil reaffirmed today.

The Non Profit Distributing (NPD) model will play a pivotal role in improving Scotland's infrastructure and supporting the Scottish economy.

It removes the excessive profits made by private companies in past PFI projects, gives stakeholders greater involvement in the management of projects and ensures any surplus money from the project can be reinvested for public benefit.

Speaking in Edinburgh at a gathering of senior business leaders organised by the Scottish Futures Trust, Alex Neil, Cabinet Secretary for Infrastructure and Capital Investment, said:

"For years, Scottish taxpayers have been fleeced by the PFI deals that deliver massive profits for private companies. Those days are gone forever because this Government has set the country free from the shackles of PFI, a decision that will benefit Scotland for generations to come.

"Capital spending is vital for the health of our economy, which is why we are committed to sustained investment in Scotland's infrastructure despite draconian cuts to our capital budget imposed by Westminster.

"The £2.6 billion of capital we are spending this financial year is estimated to support around 36,000 jobs in the Scottish economy, including around 20,000 in the construction sector.

"The Scottish Futures Trust will take forward a £2.5 billion pipeline of projects using NPD, including major investments such as the package of improvements to the M8, the Aberdeen western peripheral route, the Bamedie project and the new Royal hospital for sick kids."

"These projects will energise our economy and deliver a legacy of infrastructure assets.

"Later this year, we will unveil our Infrastructure Investment Plan, a blueprint for ambitious capital investment for the next ten years that underlines infrastructure as an essential lever in our economic strategy for Scotland."