Scottish Budget 2021 to 2022
The Scottish Budget sets out the Scottish Government’s proposed spending and tax plans for 2021 to 2022, as presented to the Scottish Parliament.
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Annex G Infrastructure Investment
The importance of infrastructure drove the 2018 decision to launch the National Infrastructure Mission which will increase annual investment by one per cent of then GDP between 2019-20 and the end of the next parliament in 2025-26. This will consequently boost annual infrastructure investment by £1.56 billion by 2025-26 and will see around £7 billion of additional infrastructure investment delivered over the course of the Mission.
Table G.01 sets out our total infrastructure investment for 2021-22 and compares it to the 2019-20 National Infrastructure Mission baseline. Overall, we have boosted annual capital spending by nearly £800 million in the early years of the Mission.
| Source | 2019-20 Budget investment | 2021-22 Investment | Difference |
|---|---|---|---|
| £m | £m | £m | |
| Capital Grant* | 4,104.8 | 5,035.6 | 930.8 |
| Borrowing | 450.0 | 450.0 | - |
| Financial Transactions* | 652.2 | 552.2 | (100.0) |
| NPD/Hub | 60.0 | - | (60.0) |
| Innovative Finance | 30.0 | 50.0 | 20.0 |
| Total | 5,297.0 | 6,087.8 | 790.8 |
*Figures for Capital Grant and Financial Transactions are gross, inclusive of receipts or other income. Further detail on gross and net position of Financial Transactions can be found in Table G.02. Capital Grant receipts and other income are £84.5 million for 2019-20 and £62.6 million for 2021-22 respectively.
Financial Transactions
Financial Transactions are a type of funding allocated to the Scottish Government by HM Treasury. They can only be used to make loans to or equity investments in private sector entities. The funds must ultimately be repaid by the Scottish Government to the UK Government. Portfolios receive a budget allocation for Financial Transactions investment and can be permitted to retain a proportion of receipts due in a year. This produces a net investment figure. As time passes, and more loans have been made, the scale of receipts increases. As the amount of new Financial Transactions funding allocated by the UK Government reduces, which between 2020-21 and 2021-22 is a reduction of around two thirds, the proportion of investment funded by receipts becomes more important. Table G.02 shows the gross budget receipts and net Financial Transactions budget by portfolio.
| Portfolio £m | 2021-22 Gross Financial Transactions | 2021-22 Forecast of Financial Transactions Receipts | 2021-22 Net Financial Transactions |
|---|---|---|---|
| Communities and Local Government | 185.5 | 85.5 | 100.0 |
| Environment, Climate Change and Land Reform* | - | 0.6 | (0.6) |
| Economy, Fair Work and Culture | 244.3 | 44.3 | 200.0 |
| Education and Skills | 30.5 | 8.4 | 22.1 |
| Finance | 4.5 | 1.2 | 3.3 |
| Health and Sport | - | - | - |
| Justice | - | - | - |
| Rural Economy and Tourism | 28.6 | - | 28.6 |
| Social Security and Old People | - | - | - |
| Transport, Infrastructure and Connectivity | 58.8 | 4.2 | 54.6 |
| Crown Office and Procurator Fiscal Service | - | - | - |
| Social Security and Older People | - | - | - |
| Scottish Parliament | - | - | - |
| Total | 552.2 | 144.2 | 408.0 |
*The negative net position is due to an overall repayment of Financial Transactions in this portfolio, arising from repayment of loans made to Zero Waste Scotland.
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