Doug Smith, chairman of CBRE Scotland, has commented on Scotland’s 2021 Draft Budget as delivered by Cabinet Secretary Kate Forbes yesterday.
He said: “A search of the Budget report reveals that the word ‘capital’ appears no less than 236 times. That gives some idea of the importance which new capital investment is likely to play in supporting, or some may say driving, the post COVID economic recovery. And that is potentially welcome news for those in sectors involving “real assets”.
“Capital investment is to be spread across multiple programmes including the Infrastructure Investment Programme, a new Place Based Investment Programme, an Affordable Housing Supply programme, and a programme of investment to regenerate Scotland’s vacant and derelict land. The sums allocated against these ambitious programmes may appear large but against the scale of both the challenges and opportunities that exist today within the Scottish economy they will not come close to meeting the ask.
“So whilst programmes such as these should be welcomed, their limitations must also be acknowledged alongside an ask that the application process is made as straightforward as possible with deployment of funding as quickly as possible.
“It becomes clear therefore that the soon to be published Capital Investment Plan, which is to ‘provide a set of actions to improve performance in attracting internationally mobile private capital’, becomes even more critical given the clear need for private capital to supplement limited public sector capacity.
“Competition to attract mobile private capital will be intense as other countries and regions of the UK face up to the same challenges of economic re-building.
“So it is essential that Scotland is both ‘investor-ready’ and takes a pro-active approach to engagement with these investors.
“The Budget report included a statement with which few could take issue: ‘Making the right investments in the right places is crucial, to sustainable and inclusive growth, and our capital funding decisions matter just as much as our day‑to‑day spending – supporting employment and economic recovery through large‑scale infrastructure plans.’ But I would add two parallel requests; first, that the public sector acts as an enabler and facilitator of new capital projects – we need shovel-ready to mean just that, and second that more so than ever partnership working between private and public sectors in both selecting and delivering the right investments is truly embraced.
“Within the private sector there is a genuine willingness to share the burden of driving economic recovery in Scotland, as well as the success that will come from achieving that objective.”