Edinburgh City Council’s suggestion that “tax incremental funding” should be used for construction work on the city’s waterfront area has been supported by the Scottish Government.
Finance secretary John Swinney approved the proposal, the first time the funding will be used in the UK. The local authority will borrow £84M to cushion the firms involved against increases in business rates.
A cruise liner terminal, lock gates, an esplanade and link road are being planned for the waterfront.
The Scottish Futures Trust and the council both worked on the funding proposal.
Swinney said: “Westminster cuts to the Scottish Budget have emphasised the importance of finding new funding models to deliver crucial infrastructure projects such as the Edinburgh waterfront, that can unlock further economic development, whilst ensuring maximum value for the public purse. We established the SFT (Scottish Futures Trust) to do exactly that; an approach endorsed by the findings of the recent independent Budget review.
“Approval of this pilot project shows that greater collaboration across the public sector through SFT can achieve positive results. SFT and Edinburgh Council have presented a convincing case for use of TIF (tax incremental funding) to kick-start this project, which presents real opportunities for the city and wider Scottish economy.”