12 September 2008
The Scottish Government is to press ahead with its controversial plan for a Scottish Futures Trust, which will play a 'key role' in delivering a £35bn investment plan over the next decade, Finance Secretary John Swinney has announced.
Swinney gave details of the new trust, which will replace existing public-private partnership schemes, to the Scottish Parliament on September 10. He said: 'The SFT will bring together a wide range of partners, expertise and resources to provide the high-quality schools, hospitals and transport infrastructure that Scotland needs, in a far more cost-effective way than the Private Finance Initiative has done in the past.'
The minister said the new body had been registered as a company limited by shares. It would be 'wholly owned by Scottish ministers in the public interest' but would operate as an 'arm's-length' body. The board would include local authority expertise and other public sector representatives.
The SFT, which will channel public and private capital into infrastructure projects such as the new Forth road bridge, will encourage councils to issue bonds collectively and fund projects using non-profit distributing principles.
He added: 'The SFT will perform a key role in taking forward the government's programme of infrastructure investment, which is vital in delivering public services and in supporting sustainable economic growth. 'Lessons have been learned from previous PFI contracts. It is quite clear that the PFI approach used in the past has not delivered best value for the taxpayer.'
Opposition parties criticised the plan as another version of the PFI. Labour said it was 'nothing more than an expensive and poorly managed rebranding of public-private partnerships with a quango on top'.
The Scottish Conservatives said the jury was still out on the SFT. The Liberal Democrats claimed the plans had created delay and uncertainty over the building of school projects throughout Scotland.
Angela Scott, head of CIPFA in Scotland, questioned whether the new trust scheme would provide better value for money.
She said local authorities already had access to borrowing at a much cheaper rate than could be obtained by any private sector consortium. But she added that the cost of money was not the only factor. 'There are other dimensions to be considered within the test of value for money,' she said, including 'private sector skills, project management and procurement'.
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