Capital Spending Review

Portfolio Question Time – in the Scottish Parliament at on 1 May 2024.

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Photo of Rhoda Grant Rhoda Grant Labour

To ask the Scottish Government whether it will provide an update on when its review of capital spending will be complete. (S6O-03364)

Photo of Shona Robison Shona Robison Scottish National Party

The capital outlook is currently very challenging, with a 9 per cent real-terms cut in our capital funding from the United Kingdom Government. Work is under way to update the infrastructure pipeline to ensure that it is affordable and deliverable and provides the best value for money.

Photo of Rhoda Grant Rhoda Grant Labour

In the Highlands, a number of health projects have been paused, including the maternity services upgrade, the new Belford hospital for Fort William and the Caithness health redesign. During the pause and delay, construction costs are increasing, which is not only adding greater costs to the investment but creating greater costs for NHS Highland, because it must manage the failing infrastructure. When will the review be complete? What will be the value of the projects that get the go-ahead, and what will be the value of the projects that are scrapped?

Photo of Shona Robison Shona Robison Scottish National Party

I very much understand the issues that Rhoda Grant has raised. However, given not just the cut to our capital budget but the significant levels of construction inflation, there has been a reduction in our spending power on top of the capital cut, so we have had no other choice than to revisit the pipeline of projects.

As I have said to Rhoda Grant in the chamber previously, and as I said in my initial answer, work is under way to review the programmes that relate to the 2021 infrastructure investment plan, to ensure that it is affordable and deliverable and provides value for money. The refreshed infrastructure pipeline is intended to be published alongside the medium-term financial strategy, as it is right that future investment plans are embedded in wider thinking on fiscal sustainability. That will include reference to the health projects that Rhoda Grant has mentioned.

Photo of Alex Rowley Alex Rowley Labour

The bus partnership fund has been paused, despite local transport authorities spending a lot of time and money working up bids worth hundreds of millions of pounds that are clearly linked to the Government’s strategy for hitting net zero and getting people out of cars and on to public transport. How will the Government prioritise that? Will the Deputy First Minister give an indication of when the bus partnership fund will resume?

Photo of Shona Robison Shona Robison Scottish National Party

The bus partnership fund sits in the Cabinet Secretary for Transport’s portfolio, but it is clear that support for the expansion of public transport is a key lever in our ambitions towards net zero.

Alex Rowley referred to prioritisation. In the light of the construction costs and inflation that I mentioned, the cut to our capital budget and the further cut to financial transaction availability, we have had to make very difficult decisions in the capital priorities work that is going on—work not just on the infrastructure investment pipeline but across the whole Government. That work is under way, and, when a new First Minister comes into post, I am sure that they, too, will have a view on those priorities.

Photo of Beatrice Wishart Beatrice Wishart Liberal Democrat

Two weeks ago, I asked the Cabinet Secretary for NHS Recovery, Health and Social Care when we might know more about the timetable to replace Shetland’s Gilbert Bain hospital. He acknowledged that certain parts of the 1950s-designed building are in a bad state. In the light of the capital spending review, and as the Gilbert Bain hospital is one of the oldest hospital buildings in the Highlands and Islands, will the Deputy First Minister do all that she can to ensure that progress towards a replacement hospital is forthcoming?

Photo of Shona Robison Shona Robison Scottish National Party

I will ask the health secretary to write to Beatrice Wishart. What I said to Rhoda Grant about the infrastructure investment pipeline and the reasons why we are revisiting it, which are multifaceted and include the rise in construction costs and the cuts to the capital budget, applies to all those projects.

I understand Beatrice Wishart’s, and Rhoda Grant’s, point that giving certainty as early as possible is very important, which is why the refreshed pipeline will be published alongside the medium-term financial strategy.