Scotland gains extra £500m from UK infrastructure fund

The Scottish Government is to receive an extra £500 million as a result of UK government plans to boost infrastructure funding, Scottish secretary David Mundell confirmed yesterday.

Chancellor George Osborne has pledged an extra £5 billion for transport, energy and housing projects of which Scotland will get a share through the Barnett formula which dictates the level of public spending in Scotland, Wales and Northern Ireland.

Under the Barnett formula, extra funding or cuts from Westminster are allocated according to the population size of each nation and which powers are devolved to them.

Mr Mundell said the additional £500m would be passed to the Scottish Government through the block grant but ministers at Holyrood can decide how it is spent.

Speaking from the Conservative party conference in Manchester, Mr Mundell told the BBC: “The positive thing for Scotland is that Barnett consequentials will apply to the infrastructure funding and that should mean about £500m of spending coming to Scotland.

“What we want to see is that the Scottish Government will commit to spending that on infrastructure.

“Of course they are free to spend money that comes any way they want but I think people in Scotland would expect to see a significant infrastructure investment, the same as the rest of the UK.”

The Scottish Government said it would not find out its block grant for future years until the UK government’s spending review in November.

A spokesman added: “It is not yet clear if this money will simply replace further planned cuts, so the UK government must provide clarity about the likely outcome of the spending review in order that we can plan effectively.

“We have put infrastructure investment at the heart of our economic strategy and have taken steps to sustain investment, in the face of significant cuts to capital spending.

“While we await further detail on the new National Infrastructure Commission, the Scottish Government expects to be consulted by the UK government on the role and priorities of the commission.”