Infrastructure Investment Plan 2021-22 to 2025-26: programme pipeline update - March 2023

Sector: Natural capital

Programme name: New planting and forest expansion

Programme description: New planting and forest expansion.

Estimated total investment: £283 million.

How is programme being funded: Capital funded.

Programme delivery timetable: 2021-22 to 2025-26.

Latest programme progress: The 'draft' Forestry and Land Scotland (FLS) Acquisition Strategy sets out the principles under which FLS will use both the £30 million of Scottish Government low carbon funding and the FLS strategic funds to acquire land in order to grow Scotland's national forests and land.

Utilising these funds, in 2022-23 FLS acquired 3,700 ha of new land at a total cost of £20.9 million. Roughly, 40% of this land will be plantable for trees with the remainder being managed for peatland / habitat restoration, and/or ecological / recreational outcomes.

Stepped increases in new planting targets have been set with the aim of achieving 18,000 ha planting in 2024-25. Annual targets are now as follows: 2022-23 15,000 ha, 2023-24 16,500 ha and 2024-25 18,000 ha. Although Scottish Forestry approved claims for over 13,000 ha of new woodland creation in 2021-22, actual planting achieved was confirmed as 10,480 ha in July 2022. We also anticipate that planting for 2022-23 will fall below target with circa 12,800 hectares of claims having been submitted. This is due to ongoing challenges in Forestry sector capacity restraints.

The Bute House Agreement 4,000 ha/yr native woodland creation target was exceeded for 2021-22 with 4,360 ha of native woodland approved for the year ending 31 March 2022. We are also on target to achieve the native woodland target for planting in 2022-23.

Plans to implement required infrastructure and resource for longer term ambitions have progressed well with our targeted recruitment of 33 new posts having been substantially completed. In addition to tackling the supply-side capacity constraints, our work on Forestry Grant Scheme (FGS) Enhancements should increase demand for woodland creation, through increased applications for Trees on Farms and riparian plantings and through improved community engagement leading to faster application processing. Although we still have to quantify the impact of these improvements, they should have a positive effect on the pipeline of future projects.

Contribution to economic development: A report on the economic contribution of the forestry sector in Scotland showed that Scottish forestry contributes approximately £1 billion GVA (Gross Value Added) to Scotland's economy every year. GVA measures the contribution to the economy of each individual producer, industry or sector in the UK.

Forestry's economic contribution to Scotland is £954 million GVA: £771 million comes from forestry and timber processing; and £183 million comes from forest recreation and tourism. Employment levels are up with more than 25,000 full time employees now working in the sector.

Forestry and timber processing contributes £771 million GVA per year to Scotland's economy; and employs 19,555 people (full time) in Scotland. Forest recreation and tourism contributes £183 million GVA to the Scottish economy every year; and employs 6,312 people (full time) in Scotland. Forestry activities are spread across Scotland, including in rural and remote areas where they generate important income and employment opportunities.

Contact for public enquiries: email: Pat.Snowdon@forestry.gov.scot

Programme name: Peatlands

Programme description: Capital investment as part of our 10-year £250 million commitment to restore 20,000 ha annually, and 250,000 ha by 2030.

Estimated total investment: £100 million.

How is programme being funded: Programme currently funding full capital costs of peatland restoration projects delivered by our partners. Looking ahead, a range of alternative funding models will be explored.

Programme delivery timetable: 2020-21 to 2025-26.

Latest programme progress: Peatland restoration continues to be progressed across Scotland through the work of our current delivery partners (NatureScot (Peatland Action), Forestry and Land Scotland, Cairngorms National Park, Loch Lomond and Trossachs National Park and Scottish Water). As per latest figures (until February 2023) during 2022-23, around 7,500 hectares of degraded peatland were put on the road to recovery. This number will be confirmed in May 2023 once the required quality assurance is completed.

We have also developed, in partnership with Environmental Systems, a digital portal. This is designed to help project developers, policy makers and researchers to gather information about the condition of peatland across Scotland, and support site selection and design of future peatland restoration projects. It is available here: https://peatscope.com

Through our Peatland Programme, we continue to work with our partners to understand and address the structural, operational and resourcing challenges around significantly upscaling rates of restoration.

Contribution to economic development: Investment in peatland restoration over the coming 10 years will help to support small and medium size businesses that deliver restoration works, often in rural areas. It will also provide opportunities for landowners and land managers, farmers and crofters and third sector bodies. This includes huge potential for peatland restoration to provide significant numbers of green jobs over the next decade.

Restoration also helps peatland and its valuable biodiversity adapt to climate change. That in turn provides us with adaptation benefits including reducing flood risk and soil erosion and improving water quality. Our peatland restoration programme will benefit Scotland's communities as part of a Just Transition to Net Zero. It will improve people's enjoyment of the natural world, provide jobs, and offer many other public benefits to health, education, environmental justice, and tourism.

Contact for public enquiries: email: peatland.restoration@gov.scot

Programme name: Low Carbon Vacant and Derelict Land Investment Programme

Programme description: The Vacant and Derelict Land Investment Programme (VDLIP) is a capital programme to help with tackling persistent vacant and derelict land and supporting place-based approaches to delivering regeneration and sustainable inclusive growth, as part of a 'just transition' to net-zero by 2045. It is a competitive fund open to all 32 local authorities and the Clyde Gateway URC (Urban Regeneration Company).

Estimated total investment: £50 million.

How is programme being funded: Capital funded.

Programme delivery timetable: 2021-22 to 2025-26.

Latest programme progress: In September 2021, 10 successful projects were announced from the first round of funding representing an investment of £5 million in 2021-22. Another 10 additional successful projects were announced in May 2022 constituting a further investment of £5 million for financial year 2022-23. In February 2023, it was announced that a further 15 successful projects were being awarded funding for 2023-24 totalling an award value of £9.3 million. The call for 2024-25 funding will be announced in April 2023. Successful projects can be viewed at the Low Carbon Fund: VDLIP projects website.

Contribution to economic development: Scotland currently has more than 11,000 hectares of registered vacant and derelict land which offers significant potential to be brought back to positive use to the benefit of communities. This fund supports projects that prioritise such sites and protect our existing natural capital ensuring that future infrastructure investment goes into areas where it is needed the most, stimulating economic growth, creating jobs, promoting environmental justice, and supporting communities to flourish and tackle inequalities.

Contact for public enquiries: email: vdlip@gov.scot