Infrastructure plans no longer affordable – watchdog – BBC News

The Scottish government will be unable to deliver its investment plans for public sector infrastructure, a public spending watchdog has warned.

Ministers are not expected to be able to fund all £26bn worth of investments.

An Audit Scotland report found higher costs, increased maintenance needs and reduced budgets would force ministers to reassess spending priorities.

The Scottish government said efficiencies around managing public sector property would be required.

Roads, railways, hospitals and other public buildings all fall under the heading of public sector infrastructure.

Examples given in the report of affected projects included:

Auditor General Stephen Boyle also said NHS treatment centres were also among the projects facing delays and cost increases.

“What’s clear is there is both an increase in costs and a reduction in budget and that will affect both the time taken to deliver the projects and potentially the scope of this work,” he told BBC’s Good Morning Scotland radio programme.

“We refer for example to planned national treatment centres that were central to the governments ambitions to reduce waiting times as a consequence of the pandemic.”

There are currently only three treatment centres operational out of the 11 planned.

“That inevitably will have a direct impact on people lives and experience of the NHS,” he said.

Mr Boyle added that the government needed better data on its infrastructure in order to inform its planning, including better information on the condition, occupancy and cost of the wider public estate.

The return to the public sector of buildings built under private finance initiatives would also need to be planned for, he said.

The Audit Scotland report also noted that the government would face “extreme” challenges when adapting existing public buildings to meet environmental targets.

A combination of reduced budgets, higher costs and increased maintenance requirements have left ministers with difficult decisions to make on what to fund.

The Scottish government’s capital funding – the money used to fund physical assets rather than day to day expenses like salaries – is declining.

Once inflation has been taken into account, ministers anticipate a 7% cut in real terms in the money the Scottish government receives from the UK government for capital projects between 2023 and 2028.

In addition, construction costs are increasing at the same time as budgets are expected to decrease.