How the pledges will be funded

A RANGE of funding schemes were set out by infrastructure minister Alex Neil yesterday to help pay for the £60 billion of pledges contained in his investment plan.

The main method is traditional capital spending direct from Scottish Government coffers, which will account for more than £7 billion of spending in the next four years alone.

The government will also utilise more than £2bn in borrowing powers, which will be made available through the Scotland Bill when passed, although the SNP Government is pressing for the level to be raised to more than double this level. The SNP is also an advocate of the PFI-style Non-Profit Distributing model of using private finance, with projects including the M8 completion, Aberdeen Western Peripheral Route, and the Royal Hospital for Sick Children in Edinburgh to be funded this way.

The Regulatory Asset Base scheme will be used to fund new rail projects, including the Edinburgh-Glasgow Improvements Programme, as well as improving digital infrastructure and to upgrade the electricity transmission grid.

The Tax Incremental Financing method will be used in six pilot schemes, while a second wave of the National Housing Trust initiatives will be taken forward, which leverages in private sector funding and council borrowing to support affordable housing.