Scotland’s £26bn infrastructure investment plan in tatters as major project costs soar | New Civil Engineer

Audit Scotland said a combination of materials price inflation, labour shortages, supply chain pressures and the drive to net zero had ramped up the anticipated expenditure on big public schemes.

The Scottish Government set out its £26bn five-year Infrastructure Investment Plan (IIP) in 2021, with a focus on the transition to net zero emissions and environmental sustainability. It included pledges of over £1.2bn for major rail improvements, £550M for rail decarbonisation projects, £328M for the A9 dualling programme, £104M for a modernisation of Glasgow Subway, £180M for carbon capture technologies, £150M for flood risk management, £550M for active travel and much more.

Ministers pledged at the time that this spending plan “delivers our National Infrastructure Mission commitment” to boost annual investment in infrastructure by 1% of 2017 Scottish GDP by 2025/26.

However, the government admitted in June 2022 that it did not have the funding required for all its commitments.

Now the latest report from Audit Scotland has warned that ministers anticipate an 11% budget shortfall in 2024/25, rising to 16% the following year.

Construction costs are rising at the same time, with eight of 45 projects analysed by the watchdog seeing a combined £55M hike in the six months to June 2023.

The report doesn’t state which projects these are. But it does note that just 18 out of 124km of the A9 between Perth and Inverness have been dualled, with the government admitting that its target of completing the other 106km by 2025 would not be met.

Meanwhile the decarbonisation of the Borders railway has been put on hold while an action plan is “refreshed”, the study stated.

Audit Scotland urged the Scottish Government to produce “clear information” explaining decisions to prioritise, delay or cancel projects.

It also called for public reporting that allowed consistent monitoring of infrastructure schemes including where “costs or timescales have increased”.

“Across the documents published by the Scottish Government, it is difficult to track the progress and spending of individual projects and programmes,” said the report.

“Details are available for only £14.9bn of the £26bn of infrastructure investment originally announced… the format of the infrastructure updates makes it difficult to compare with the original IIP.”

Deputy first minister Shona Robison said the Scottish Government remained “firmly committed” to infrastructure investment.

“The challenging economic conditions of the last few years resulting from Brexit and high inflation as well as the real-terms fall in the capital grant allocation from the UK Government have led to delays for some infrastructure projects,” she added. “Looking ahead we are having to prioritise projects and programmes so the capital spending available is targeted.

“We have also started work on delivering a more efficient approach to the management of public sector property that will save public funds and enable organisations to step towards a net zero estate.”