All systems go for £84m plan to revive Waterfront

Published on Monday 27 September 2010 17:28

AN £84 million plan to restart the development of Edinburgh's waterfront was today given the go-ahead.

The city council wants to borrow the money against future business rates income in order to fund a series of works at Leith Docks, including a new cruise liner terminal, lock gates, a new link road and a riverside walkway with shops and restaurants.

Finance secretary John Swinney has given the green light to the innovative proposal.

The works have been chosen because they are seen as the type of schemes that will help encourage other private sector developments.

It is estimated that the work could help trigger 660m of private investment and up to 4900 jobs.

In a speech to the Scottish Futures Trust (SFT) conference in Edinburgh, Mr Swinney was set to reveal that a business case for the scheme has now been provisionally approved by the Government.

He said: "Westminster cuts to the Scottish budget have emphasised the importance of finding new funding models to deliver crucial infrastructure projects, such as the Edinburgh Waterfront, that can unlock further economic development, whilst ensuring maximum value for the public purse.

"Approval of this pilot project shows that greater collaboration across the public sector through SFT can achieve positive results."

Edinburgh will become the first city in the UK to use what is known as Tax Incremental Financing (TIF) - already popular in the United States - to fund a public sector work.

In a business case compiled by the city council and SFT it was estimated that, if the funding approach is approved, a "worst case scenario" would be for it to lead to 72m of new income for the area and 2630 new jobs.

Council leader Jenny Dawe said: "I warmly welcome the Scottish Government's support. Our aim is to kick-start growth, which will protect and create jobs now rather than waiting until the economy recovers.

Barry White, chief executive of the SFT, said: "Tax incremental financing is an innovative way to fund growth from growth which supports jobs and aids economic recovery.

"This pioneering 84m waterfront development brings TIF to the UK for the first time and will unlock up to 660m investment from the private sector."