Shovel ready spending: the darker truth

Infrastructure spending: we’ve heard so much of it by now the only surprise is that the entire country is not now covered in now roads and railway track…

The Scottish government was at it again yesterday, announcing another £3 billion capital spending on schools, hospitals, roads and other infrastructure “set to support 40,000 jobs across Scotland this year”.  

Impressive, isn’t it? But where is it?

Time and again Scot Buzz has highlighted the gap between grandiose claims on “shovel ready” projects – and the distinct lack of action on the ground.

The fact is that, far from enjoying an infrastructure boom, Scotland’s construction sector is in dire straits. Latest GDP figures from the Scottish government last week showed that construction output in Scotland fell by 7.1 per cent in the 12 months to end September.

Nor are we alone in noting the gap between big spending numbers and real world activity.

The latest list testifies both to a slippage in activity – and a sharp increase in project costs.

Numerous schemes have seen their timescale slip in the last year, while others are coming in tens of millions over budget.

• The Aberdeen bypass had previously been estimated to cost as little as £295 million, but has now been confirmed as likely to cost more than £650 million.
•  The A90 upgrade between Balmedie and Tipperty, formerly projected to cost between £53 million and £63 million. It is now set to hit £92 million.
•  Improvements to the M873 and M874 are now reckoned at £415 million, compared to £280 million last year, and the timescale for the Stornoway to Ullapool ferry project has slipped by a year to 2014.

Scottish Conservatives say the updated programme pipeline document unveils a range of initiatives, but with no indication when they will be delivered or how they will be paid for. Says the party’s infrastructure spokesman, Alex Johnstone,“This might as well be called the lack of progress report. What we have is a list of schemes that are running over budget or behind schedule, then a new wish list with no detail on where the money will come from or how it will be delivered.

“It’s bad enough that the Scottish Government has failed spectacularly on delivering its NPD scheme, with only £20 million spent when nearly £500 million was promised. Now we see a whole list of other projects which are running away with themselves.”

Nor does the Labour front bench seem any more convinced.

Richard Baker MSP, said, “We all want to see more investment in infrastructure but the problem is the Scottish Government is talking about it, not doing it. When this plan was first announced we said it was a wish-list. Since then projects have been further delayed and we now know that of £353 million which was meant to be invested in key projects this year, only £20 million is actually being spent. In fact, the only shovel-ready project which has been evident recently was the hole the First Minister dug himself into on this issue at the last question time.

"The SNP's failure on capital spending is shocking.”

Ms Sturgeon claimed yesterday that several projects will be completed and become operational in 2013/14.

The administration also says it expects “significant progress” on the non-profit distribution (NPD) programme in 2013/14 with major projects such as the Dumfries and Galloway Royal Infirmary entering procurement and others such as Inverness College and City of Glasgow College moving into construction.

But the  Scottish Conservatives have questioned the totals spent on NPD schemes, saying that no money was spent in 2011/12 on such schemes, while over the course of this financial year only £20 million will be used.

NPD is a concept which is supposed to inject money from the private sector to help major construction projects happen and get the sector moving. The administration has continually trumpeted its £2.5 billion spending. But at no stage has it mentioned dramatic reductions in that spend, nor delays.

Said Scottish Conservatives finance spokesman Gavin Brown MSP, “This is a deeply embarrassing situation for the Scottish Government. Despite regular boasts to the contrary, the SNP’s flagship NPD capital programme has delivered precious little so far for the construction industry. To make matters worse, the Scottish Government has failed to be transparent and upfront about its sloth-like performance.

Ministers have some serious explaining to do – as a matter of urgency.In plain terms, the Scottish Government saw nothing happen in one year, then less than six per cent of the promised spend the next.  This is a dismal failure.”