Underspend should generate growth
UK Government underspend of £6.7 billion last year should be used to grow the economy, the Infrastructure and Capital Investment Secretary said today.
New statistics published by HM Treasury show that UK Government departmental spending was £6.7 billion lower than planned in the year to March.
Infrastructure Secretary Alex Neil called for some of the cash to be used to give the green light to infrastructure projects in Scotland which are ready for construction and which would create jobs and growth.
The Scottish Government has provided Westminster with a list of projects that are “shovel ready” and could support around 1,400 jobs across the Scottish economy with every additional £100 million of capital spending.
Mr Neil’s call follows a £105 million package of economic stimulus recently outlined by Scottish Government Finance Secretary John Swinney.
Mr Neil said:
“The Scottish Government has repeatedly called on the UK Government to provide resources for capital investment to support economic recovery. We have always been clear that one of the primary ways to do this is by investing in our infrastructure.
“At the request of the Prime Minister we provided him with a list of 36 projects ready for construction in March. Despite repeated requests, we have yet to receive any funding.
“The Prime Minister told the First Minister that he accepts the principle of bringing forward capital investment but that there are no suitable "shovel ready" projects in England which could receive funding to begin in 2012 or 2013. This is not the case in Scotland.
"We have done what we can within our powers to fund shovel ready projects and indeed, we have funded some of the shovel ready project list provided from within our own resources, however there remains more we could do if additional funding is provided.
“Some of the newly revealed £6.7 billion UK underspend would benefit communities all over Scotland and generate significant employment.
“This Government has already demonstrated that where we have fiscal flexibility, we will use our resources to boost recovery.
“This again highlights the limitations of the current constitutional arrangements, in particular our inability to borrow. Work is delayed while we await the green light from Westminster, which is completely unacceptable and is holding us back.”
The full list of the shovel ready projects submitted to the UK Government, including some projects which the Scottish Government has now funded itself.
Last month Finance Secretary John Swinney announced a £105 million package of economic stimulus, including funding for some of the shovel ready projects.
Treasury figures are available.