Scottish Futures Trust

Recommendations published for Scottish National Investment Bank

Benny Higgins

Details of the implementation plan for a publicly-owned Scottish National Investment Bank have been published today.

Developed by Benny Higgins, CEO of Tesco Bank, alongside investment professionals, academics, the Scottish Futures Trust, Scottish Enterprise and senior Scottish Government officials, the plan has recommendations covering the remit, governance, operating model and financing of the new bank.

The plan recommends that the bank should:

  • Be publicly-owned and mission-driven, focused on supporting Scotland’s economic priorities and promoting inclusive growth
  • Operate in an ethical and transparent way
  • Cowork to crowd in, not crowd out, private sector investment
  • Be supported by long-term capitalisation of at least £2 billion over the first ten years
  • Become self-sustaining in the longer term, raising its own capital to fund investments
  • Provide long-term, patient finance for both smaller firms and larger projects
  • Create opportunities and new markets for the private sector to invest in

Welcoming the report, First Minister Nicola Sturgeon, who first announced the plans in September, said: “To realise our ambitions for Scotland’s economy, innovative companies need access to strategic, patient finance to grow and thrive, while the business environment must encourage our young people to be the entrepreneurs of the future. That is why I committed to a publicly-owned national investment bank, which will act as a cornerstone for the economy.

“I thank Benny Higgins and the advisory group for their work to bring this aspiration a step closer. The Scottish Government will carefully consider his recommendations, as we move forward with the creation of the Scottish National Investment Bank.”

Benny Higgins said: “There is an incontrovertible case for creating the Scottish National Investment Bank. The economic and social wellbeing of our country will be enhanced by an institution that complements private sector investment, with a clear focussing on SMEs and projects that require strategic patient capital.

“We have undertaken rigorous analysis through this process and engaged an extensive and broad group of individuals and bodies in both the public and private sectors. There is a strong consensus that there is an immediate and pressing need for the creation of the bank.”

The recommendations will be considered by Scottish Ministers, before a formal response in the Spring.

Scottish Renewables welcomed “positive” comments made by Benny Higgins today as he described renewable energy as a sector “in the crosshairs of what is intended for the Scottish National Investment Bank”.

Claire Mack, chief executive of Scottish Renewables, said: “Scotland leads the world in the development of devices which can capture energy from waves and tides – but these are sectors which are at a difficult stage of their development.

“We welcome comments made by today the First Minister that the new Scottish National Investment Bank will focus on delivering ‘patient long-term strategic investment’ to cater for ‘sectors that the market currently doesn’t’.

“Wave and tidal technologies offer particular characteristics that are helpful in supporting our move towards a new, less centralised energy system and, as we’ve seen in the economic cases behind our island wind projects, can offer wider benefits to smaller, more fragile economies.

“With the right investment, our wave and tidal energy sectors can continue on the path towards full commercialisation, giving Scotland a huge first-mover advantage in an energy sector with enormous global potential.”

Construction of new Arbroath primary schools underway

Ladyloan Primary School

Work to replace two Arbroath primary schools as part of an ambitious multi-million pound project was marked by two official site visits today.

Children and learning vice-convener, Councillor Derek Wann, attended first at Muirfield Primary School and then at Ladyloan Primary School to tour the developments underway at both school sites.

He was joined by pupils and staff, fellow local councillors and council officers, as well as representatives from contractors Robertson Tayside, procurement partners hub East Central Scotland and the Scottish Futures Trust.

Councillor Wann said: “The Arbroath Schools Project represents a significant investment in our local schools estate as well as our local community, our local children and their futures.

“It has seen the delivery of new schools at Timmergreens and Warddykes. We forge ahead with replacing Muirfield and Ladyloan schools, where work got underway before Christmas. Later this year, work will also begin on a shared campus for Hayshead and St Thomas primary schools.

“These are exciting times as we continue the transformation of our educational facilities. We are committed to ensuring that the schools resources we provide to our children in Angus present them with the best opportunities to realise their potential.”

Designed by Holmes Miller, both the new Muirfield Primary School and the new Ladyloan Primary School are being constructed within the existing schools’ grounds so that they can remain operational and the impact upon pupils and staff is minimised while the work is being carried out.

Construction of the new buildings should be complete by the end of this year, with children and staff scheduled to move in at both new schools in time for the Spring Term (Jan 2019). The existing buildings will be demolished and each replaced by a new car park and sports pitch. This work is scheduled for completion by the end of May 2019.

Gary Bushnell, chief executive, hub East Central Scotland, said: “It’s great to see the project progressing well and we look forward to delivering two high quality news school buildings for the community. Our teams work closely with Angus Council to support their education and learning strategy and this project follows the recent successful completion of community school campuses in Brechin and Forfar.”

Kevin Dickson, managing director, Robertson Tayside, said: “These two projects will have a major impact on future generations in Angus. We look forward to engaging with the council and community – including future pupils of the two schools – throughout the construction phase and beyond. We will be working with all stakeholders, including our facilities management business, and I have no doubt that the completed schools will be of the highest quality.”

Gemma Boggs, education delivery director at Scottish Futures Trust, added: “Ladyloan and Muirfield primary schools takes the number of schools to have entered construction under the £1.8bn Scotland’s Schools for the Future programme, which we manage on behalf of Scottish Government, to over 100.

“This is a very exciting time and these two primaries are great examples of the evolution of school design that has been seen over the programme. They promote the creation and delivery of world-class, learning environments that not only meet future educational needs but the communities they serve as well.”

New chief executive for Scottish Futures Trust

Peter Reekie

The Board of the Scottish Futures Trust (SFT) has appointed Peter Reekie as the company’s new chief executive.

He takes up the position on 10 January 2018 from Barry White who is leaving to take up the role of chief executive for Transport for the North, based in Manchester.

Peter Reekie, currently deputy chief executive and director of investments at SFT, was involved with the initial development of SFT and has been with the company since 2009 when it became operational.

Ian Russell, SFT chairman, said of Peter’s appointment: “We are delighted to have secured someone of Peter’s calibre to take SFT forward. The vacancy attracted a large amount of interest, but it was clear to the independent interview panel that Peter’s professionalism, his strong credentials and track record made him the stand-out candidate for this demanding role.”

Peter Reekie said: “I am excited and honoured to be named SFT’s new chief executive. It is a fantastic organisation and I’d like to thank Barry White for all of his work to build SFT to the success it is today. I am ambitious for the great team at SFT and am very much looking forward to leading the organisation and driving forward its plans for the future.”

Cabinet secretary for finance and the constitution, Derek Mackay MSP, said: “I am delighted that the Scottish Futures Trust has secured Peter Reekie, currently SFT’s deputy chief executive and director of investments, as its new chief executive, and am sure he will build on the excellent foundation laid by its first chief executive Barry White, who leaves with our best wishes for new challenges in Transport for the North.

“I look forward to working with Peter in his new role within SFT which will continue to improve the efficiency and effectiveness of infrastructure investment working collaboratively with public bodies and industry.”

Successful ‘hub’ programme has built £1.3bn of community projects

The Carnegie Library and Galleries in Dunfermline

The value of recently completed community-based buildings such as schools and health centres delivered by the Scotland-wide hub programme on behalf of Scotland’s public sector has topped £1 billion, new figures have shown.

Managed by the Scottish Futures Trust (SFT), the hub programme is an innovative approach to develop and deliver best-value community facilities that provides public bodies with a quick and efficient way of getting their projects into construction and services delivered in to communities.

Since becoming fully operational in 2012, the five hub companies have handed over 142 projects valued at £1.3bn. A further 67, valued at £1.3bn are either under construction or in the final stages of development which is supporting some 6,100 jobs.

David Macdonald

David MacDonald, hub programme director at SFT, said: “Improved value, speed of delivery, increased community benefits and expert project management are just some of the reasons Scotland’s public sector are specifying hub to plan, construct and in many cases, manage their new buildings.”

Completed hub projects include Dunfermline Carnegie Library & Galleries designed by Richard Murphy Architects for Fife Council, which was crowned ‘Best Building in Scotland’ by the Royal Incorporation of Architects in Scotland (RIAS) in November 2017.

Another award-winning hub project is the Health and Care Centre in Eastwood, East Renfrewshire. During 2017, it received a number of design and healthcare awards, notably from the RIAS and European Healthcare Design.

The ‘reference designed’ health centre brought together the services of East Renfrewshire Council and NHS Greater Glasgow & Clyde into one, unique, community-focussed building. This joint occupancy allows the community to access multiple services in one location in a central setting with easy access to GP practices, integrated health and social care services, a community hub facility and a cafe that serves as a focal point for both the community and professionals alike.

The reference design was developed and promoted by SFT as an approach to improve future health centres across Scotland.

John Donnelly, project and development manager with NHS Greater Glasgow & Clyde, said of the hub-delivered health centre: “The Health and Care Centre in Eastwood now provides a single base for lots of professionals such as Health Visitors, Social Workers and District Nurses who deliver services to the community to be located side by side, which allows us to provide a much-improved service.”

Operational delivery ‘key to return on investment’ for Build to Rent in Scotland

A build to rent project is underway at Edinburgh's Fountainbridge

A build to rent project is underway at Edinburgh’s Fountainbridge

Investors into Scotland’s Build to Rent (BTR) sector have been urged to ensure that schemes have operational management factored in from the earliest stages of development.

A new report from residential property management company FirstPort is based on a roundtable meeting involving some of Scotland’s major players in industry and representatives of government.

With significant government backing, the hope is that BTR will attract £500 million of investment and deliver 2,500 private rental homes by 2020 to help address the housing shortage in Scotland.

But, according to Build to Rent in Scotland: Getting it right, across the UK the BTR sector has so far faced challenges establishing itself as a significant element of the housing market.

FirstPort business development manager, Jeremy Ogborne, said: “Build to Rent in Scotland: Getting it right addresses some of the barriers that have slowed investment and delivery in the BTR sector.  The report argues that securing the confidence of investors, of government, and of customers, is key, and that ensuring how the building will operate and serve its local market should be planned in from the beginning.

“The key message is that, in the end, the quality of operational delivery will define a development and the customer experience. In the everyday life of a development it is going to make the difference between efficient and high-quality amenities versus amenities which are disused or deteriorating; the difference between a vibrant community in which residents feel they belong, versus one with dissatisfied, disengaged customers.

“Operational delivery is absolutely key to providing a healthy return on investment for the long-term, reducing customer churn, and maintaining a premium look and feel.

“If a development treats this as an afterthought then it is going to struggle to remain viable, as some BTR developments currently are. There are very few managing agents in the market with the scale necessary to perform this role.

“Now the Scottish Government is calling on the sector to deliver, and with operational expertise, management information and an experienced, skilled workforce all factored in from day one, it can do so.”

Build to Rent in Scotland: Getting it right includes input from Homes for Scotland, Pinsent Masons LLP, the Scottish Futures Trust, the Scottish Property Federation, Montagu Evans, the EDI Group and representatives of the Scottish Government.

BAM wins £18m deal to deliver new Glasgow schools

Blairdardie Primary School

Blairdardie Primary School

BAM Construction has been appointed by hub West Scotland to build two new primary schools on behalf of Glasgow City Council.

Located on Liberton Street in the East of the city and on Kearn Avenue in the West End, Carntyne and Blairdardie Primary Schools will provide modern state of the art teaching facilities for local children, which, in the case of Carntyne, will include a multi-use games area that will be available for community use.

Designed by Holmes Miller, both projects commenced on site last month with completion of Carntyne scheduled for Autumn 2018 and Blairdardie following in Spring 2019.

The combined contract value is £18 million and funding has been made available through Scottish Futures Trust (SFT) which delivers public infrastructure investment on behalf of the Scottish Government through the hub network and Glasgow City Council.

Carntyne Primary School

Carntyne Primary School

Bruce Dickson, regional director at BAM Construction, said: “We are delighted to have been selected for this contract. The partnership between our local authorities, hub West and SFT is transforming Scotland’s school estate and creating buildings of importance for the wider community.”

Iain Marley, CEO of hub West Scotland, added: “We are proud to be delivering these schools on behalf of our Partner, Glasgow City Council and we are very pleased to continue our successful partnership with BAM. The projects will create high quality inspiring learning environments and bring significant benefits to local communities starting immediately during the construction period and continuing well beyond.”

BAM Construction has completed a number of primary and secondary schools in both East and West Scotland including the £27m Barrhead Secondary School for East Renfrewshire Council which was recently handed-over and Our Lady and St Patricks for West Dunbartonshire Council valued at £25m which opened to pupils in August this year.

Both of these projects were delivered in partnership with hub West Scotland.

GVA and PRSim to advise on new rental income guarantee scheme

A build to rent project is underway at Edinburgh's Fountainbridge

A build to rent project is underway at Edinburgh’s Fountainbridge

A strategic partnership has been appointed by Scottish Futures Trust (SFT) to advise on the Scottish Government’s landmark policy for supporting the emerging professionally managed Build-to-Rent (BTR) sector.

GVA and PRSim will join the Property Advisory Panel for the Rental Income Guarantee Scheme, which aims to unlock potential BTR developments with at least 30 units, through the mitigation of risk around the initial rent stabilisation period.

Through the fully integrated scheme, which was launched earlier this year, the Scottish Government will underwrite 50% of any shortfall in rental income that is between 75% and 95% of the agreed annual core rental income forecast (ARIF), the annual cost of which will be 1.22% of the ARIF.

In their advisory role, GVA and PRSim will jointly assess and report on an applicant’s ARIF in order to agree a benchmark for Scottish Government support, creating attractive investment opportunities that will facilitate the growth of BTR in Scotland as well as deliver much needed accommodation against a backdrop of a continued housing shortage.

In a recent research report into Scotland’s housing market undertaken by GVA and PRSim, it was revealed that there has been an increase in the proportion of 16-34 year olds privately renting from 16% in 1999 to 40% in 2016, driven by both difficulties getting on the housing ladder as well as a change in lifestyle and view on rented accommodation. The report discovered that 71% of Scots are content living in a rented home, with 82% of people believe renting a property best suits their lifestyle.

Barry White, chief executive of the Scottish Futures Trust, which manages the scheme, said: “RIGS has sent out a clear message which demonstrates the Scottish Government’s commitment to the Build to Rent sector as an important way to deliver much-needed quality housing.”

Alastair Carmichael at GVA added: “The Rental Income Guarantee Scheme is a breakthrough policy by the Scottish Government and a real milestone in the evolution of BTR in Scotland.  To have been appointed by the SFT in this nascent stage of our strategic partnership with PRSim is a strong endorsement not only of the strength of our combined offer, but also its uniqueness as we are the only true end-to-end experts operating a service in BTR. We look forward to developing this experience further through this innovative new Government policy and helping to deliver thousands of new homes to the Scottish market.”

Scottish Futures Trust positions housing as key economic infrastructure

Barry White

Barry White

The Scottish Futures Trust (SFT) is calling on the housing industry and Scotland’s councils to work together to further increase housing supply.

Publishing its 2016/17 Annual Business Review outlining where its work has secured £138 million of benefits and savings, SFT chief executive, Barry White, said while housing is often thought of as a social good but in a service-led economy with increasing demand and changing regional demographics, it is now a vital element in securing future economic growth.

Building houses to sell along with grant aided social housing have traditionally been the biggest elements of housing supply, and it is vital that the great activity in those sectors accelerates.

SFT has been a pioneer of a third element – affordable housing. It has secured £400m of additional investment into Scotland’s housing sector with contracts signed to build 2,700 affordable-rent homes through a range of innovative approaches. These modern, energy efficient homes are targeted at households with modest incomes, for whom housing costs would otherwise take up a very high proportion of their monthly budget.

SFT is developing further “public partnerships” to boost housing investment to over £650m and has argued that given the low cost of local authority borrowing, there is the potential to do much more without any grant subsidy.

A further new opportunity to help increase housing supply is through attracting large scale “Build to Rent” (BTR) investment. Already well established in the US and much of Europe, BTR is now fast developing as a new route to supply housing in the UK.

It is estimated that £50 billion of finance, much of it international and pension fund money, has been allocated to the BTR sector in the UK, and Scotland must fight its corner to attract its share of this significant investment. This sector brings faster development than homes for sale as well as a professional landlord with a long time-horizon of managing homes for a range of people from globally mobile millennials keen to locate in Scotland to families living in the rented sector.

To encourage BTR investment in Scotland, SFT manages the Rental Income Guarantee Scheme (RIGS) recently launched by the Scottish Government. RIGS, together with recently issued advice on planning, puts Scotland in a great position to attract significant investment into new housing supply. Scotland’s local authorities have a key role to play in embracing this new approach to providing homes.

Barry White, SFT’s chief executive, said: “Increasing housing supply is a vital element of helping an economy grow and to keep house prices and rents at stable levels. With the lowest local authority borrowing rates to be seen for many years and the wall of money behind the BTR sector, there’s never been a better time to build.

“Having already worked very closely with local authorities on housing to secure £400m of housing investment, there is now a great opportunity to increase that partnership to build more homes, of all tenures across the country, to ensure Scotland attracts and retains more great people to grow our economy.”

SFT managed the pruchase of the Victoria Hospital site in Glasgow by Sanctuary Group

SFT managed the pruchase of the Victoria Hospital site in Glasgow by Sanctuary Group

Increasing the supply of much-needed housing is just one of many programmes managed by SFT. In delivering these programme, SFT’s work secures substantial savings and benefits and since becoming operational in 2009, the total estimated value of benefits and savings delivered by the company has topped £1bn.

SFT’s work also generates significant economic benefits which includes attracting increased levels of private sector investment, improving energy efficiency across the public sector and establishing super-fast broadband in rural areas.

Some of SFT’s key achievements in addition to the £400m of investment secured for affordable housing, include:

  • The 50thschool opened in the SFT-managed £1.8bn Scotland’s Schools for the Future programme and collectively 30,000 pupils as well as the communities in which they live are benefitting from new and inspiring learning environments and first-class community facilities
  • Across the SFT-managed hub programme, over 100 community-based buildings have opened and a further 60, valued at over £1.1bn, are under construction which are supporting over 9,000 jobs
  • Working with the public sector, SFT secured £50m from the sale of surplus properties with the money being invested back to the public sector
  • SFT’s Growth Accelerator has unlocked £850m of additional economic investment into the heart of Edinburgh with construction well underway on one of the most significant city-centre regeneration projects to be seen anywhere in the UK
  • SFT’s asset management team has assisted Scotland’s public sector save over £200 million through the more efficient use of its offices and buildings
  • SFT’s Street Lighting programme has seen 28% of Scotland’s 900,000 street lamps replaced by energy-efficient LEDs, helping councils save 70,000 tonnes of CO2and £12m a year
  • Five of the 12 buildings shortlisted for the RIAS 2017 Doolan Award were delivered through SFT’s programmes, including the recently announced winner ‘Best Building in Scotland‘ theDunfermline Carnegie Library & Galleries, designed by Richard Murphy Architects and delivered by hub East Central

Barry White added: “In securing £138m of savings and benefits over the past 12 months and over £1bn since becoming operational in 2009, SFT has made a huge difference to the infrastructure landscape of Scotland and I extend our congratulations to the many public and private sector partners with whom we work in securing this success.

“Working with others to unlock public sector land to build much-needed housing, or by rolling out our innovative Growth Accelerator programme to attract multi-million-pound levels of economic investment are just two of many examples where our expertise has been put to best use to make a real difference to communities and Scotland’s economy.”

Martin Perry, project director, Edinburgh St James, said: “SFT’s bold and innovative work in devising the Growth Accelerator Model agreement, coupled with the City of Edinburgh Council’s vision for the city, has paved the way for us to invest £1bn into Edinburgh, at Edinburgh St James.

“The scheme is one of the largest and most significant regeneration projects currently underway in the UK and will transform Edinburgh’s east end into an inspiring, attractive and vibrant destination for people to live, shop, experience and play.

“Upon completion in 2020, Edinburgh St James will provide long-term benefits to Edinburgh for generations to come, pushing the city six places up the UK retail rankings to eighth place and delivering over 3,000 permanent full-time jobs in a variety of sectors.”

Speaking of Sanctuary Group’s purchase of the Victoria Hospital site in Glasgow, the sale of which was managed by SFT, Peter Martin, Sanctuary’s Group director – development, said: “We were very impressed at the speed in which SFT brought the vacant Victoria Hospital to market.

“The process facilitated by SFT has enabled Sanctuary to work with the local community to create the planning application being considered by Glasgow City Council.”

Godfrey Syrett’s education division is top of the class

A recent high school fit-out by Godfrey Syrett

A recent high school fit-out by Godfrey Syrett

Furniture manufacturer Godfrey Syrett is just weeks away from concluding its fourth Scottish school contract of 2017, after fitting out the new Kelso High School.

The £22 million state of the art facility in the Scottish Borders has been built by Morrison Construction and will accommodate 780 pupils.

After winning the contract following a competitive tender process, Godfrey Syrett took the architects original designs and converted them into a bespoke buildable solution whilst remaining within budget and programme.

Earlier in the year, the firm completed the installation of fitted and loose furniture at two brand new schools in South Ayrshire as part of a contract worth £328,000.

The state-of-the-art Tarbolton Community Campus caters for over 300 children and at Dailly Primary School a new two-storey building has replaced three previously separate buildings, with space for 100 pupils.

The schools form part of a wider investment by hub South West Scotland, which has a large pipeline of investment for schools in South Ayrshire.

The firm also completed a fit-out at the new £8.6m Duns Primary school in Berwickshire.

Godfrey Syrett’s education division accounts for almost 30% of the company’s turnover, with a dedicated team which delivers contracts directly with schools and main contractors.

Divisional director at Godfrey Syrett, Derek Mitchell, said: “2017 is proving to be a tremendous year for our education division, in terms of direct sales to schools as well as supporting main contractors such as Morrison Construction with new projects. We are building a strong reputation in Scotland and look forward to working on further projects in the future.”

The firm is also delivering a further three contracts amounting to £2m in South West Scotland on behalf of Graham Construction. The three secondary schools include a new £26.5m learning campus in Dalbeattie, as well as St Joseph’s College and North West Campus in Dumfries, all of which are being rebuilt under the Scottish Futures Trust.

Top economists call for inquiry into privately financed infrastructure projects

The Dumfries and Galloway Royal Infirmary was delivered using private finance

The Dumfries and Galloway Royal Infirmary was delivered using private finance

Two of Scotland’s most renowned economists have called for an urgent and independent root and branch review of the quango responsible for the country’s privately financed infrastructure projects.

A report by economists Jim and Margaret Cuthbert, which has been launched today by Scottish Labour, said contracts delivered by the Scottish Futures Trust (SFT) for public projects such as new schools, hospitals and roads are often shrouded in secrecy and offer poor value to taxpayers.

According to latest Scottish Government figures, officials at the NHS, colleges, councils and Scotland’s transport agency have signed 42 contracts with private financiers and construction companies for a total construction cost of £2.6 billion.

Over their lifetime, however, the projects will cost £7.6bn due to maintenance contracts lasting from 25-30 years, management fees and interest of up to 11.3% on borrowing.

According to the Cuthberts’ study, there is a secrecy and lack of transparency around how the SFT operates and its funding models are “unsustainable and expensive”.

Jim Cuthbert said: “Our research indicates a number of serious issues about hub and SFT activities, including lack of transparency, potential adverse effects on industrial structure, and worries about long term financial sustainability.

“There are specific recommendations in our report on each of these areas, which need to be implemented. But, more generally, what the report indicates is the type of problem which can occur when an organisation like the SFT grows incrementally, without adequate external scrutiny and strategic direction. The time is now ripe for a thorough review of SFT purpose and operations.”

Margaret Cuthbert added: “The latest data on the Scottish economy show poor growth in GDP. Labour productivity in Scotland, as measured by output per hour worked, decreased by 1.5% in real terms over 2016. The Scottish economy therefore faces major challenges.

“One of the major ways in which a government can help grow an economy is through the procurement of public infrastructure.

“Our paper questions whether the hub structure provides a good environment for encouraging organic growth in the economy, particularly since the hub approach will tend to limit small and medium enterprises (SMEs) to a subcontracting role to large private sector companies, most of which are headquartered outside Scotland.

“We question too whether the hub system is a good environment to encourage research and development by Scottish SMEs given work in the projects.”

The SFT’s scheme had previously come under fire for breaching EU accounting rules, with an expected cost of almost £1bn to the taxpayer.

Labour said the SNP government should now commission a full review of how the trust is operating, as well as Whole of Government accounts published, to ensure public funds are not wasted in the future.

Labour economy spokesperson Jackie Baillie said: “We need an independent, root and branch review of how the Scottish Futures Trust operates, given the scale of the problems uncovered by this report.

“The current approach is cloaked in secrecy, but we know there are serious questions about future funding.  As it stands it looks like the government has maxed out the credit card without knowing if it can afford the repayments.

“Secondary market sales of debt could end up netting the equity investors up to three times the original capital they put in. It is an expensive way of funding public infrastructure.

“It’s like going to Wonga for a mortgage and not sustainable for the public purse, especially with the new powers coming to the Scottish Parliament making sound management of our finances even more important.

“This approach to financing means even less money for public services at a time of crushing austerity.

“SFT needs to be urgently reviewed and refocused. We need the accounts opened up showing all our assets and liabilities across the public sector. Only then can we begin to make sensible investment decisions for the future.”

The SNP said Labour must apologise for their “dreadful” PFI legacy before they can have any credibility on public finances.

Ivan McKee MSP said: “Labour’s toxic PFI legacy is still impacting on Scotland’s public services more than a decade after they left office.

“This £1bn bill that we are paying is robbing a significant sum of money from our budget that could be used to pay for vital frontline services and to grow our economy.

“Unless Jackie Baillie is willing to make a full apology today for the dreadful mess that Labour made of the public finances with their disastrous PFI contracts, no one will listen to a word they say.

“The SNP was proud to bring to an end Labour’s disastrous PPP schemes and in the relatively short time since SFT was established it has achieved a cumulative total of almost £1bn in of independently-verified savings and benefits.”