EU regulations could halt eight Scottish PPP schemes

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EU regulations could halt eight Scottish PPP schemes

New European rules, which were overhauled last September, could halt eight Scottish public private partnership (PPP) schemes.

The Scottish Futures Trust (SFT) is responsible for implementing the new EU regulations in the country. Under the regulation, SFT have to reclassify many of its PPP projects, which are be developed though the Scottish Government's non-profit distributing (NPD) model, from private to public projects.

The eight Scottish PPP projects that could be halted are the following:

  • Newbattle High School in Midlothian,
  • Kelso High School in the Scottish Borders,
  • Baldragon Academy in Dundee,
  • Anderson High School in Shetland,
  • Forfar Academy in Angus,
  • Elgin High School in Moray,
  • Lothian Health Bundle and
  • Inverclyde Continuing Care Project.

Those projects are running behind schedule. If the projects do not reach financial close before the new financial year starting this April, they will be delayed.

According to sources, the government is working to ensure that the eight schools and other health projects that had been expected to reach financial close this financial year, are delivered as soon as possible.

Finance Secretary John Swinney stated:

"I have considered it appropriate to to put in place a number of steps to refine the NPD programme while seeking confirmation and further advice on the appropriate classification. The Scottish Government and SFT believe that current project arrangements demonstrate consistency with the relevant guidelines. However, until the process of engagement with the ONS has concluded, I believe it is appropriate to put in place contingency measures... All of the government's efforts will be focused on ensuring there is no need to call on the contingency."

Peter Reekie, SFT's deputy chief executive and director of investments, said:

"In common with the rest of the EU, the Scottish and UK Governments are working to ensure consistency with these updated guidelines. SFT and the Scottish Government are working with the ONS to obtain definitive clarification of the interpretation of the new classification rules. We expect this process to take a number of months. The delivery of all NPD and hub projects which are already signed and under construction - worth £1.45 billion - will be unaffected by this work.

"We are working to ensure that there is minimal delay to eight schools and health projects, being delivered via hub, that had been expected to reach financial close this financial year."

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