Infrastructure Investment Plan 2021-22 to 2025-26: progress report 2022 to 2023

Driving inclusive economic growth

Creating World Class Digital System

Digital Strategy

The Digital Strategy is committed to strengthening digital public services through investment in digital transformation. The use of common platforms, Payments and Identity platforms, and investment in Cloud technology will drive efficiencies across the public sector.

Digital Payments Programme

The Payments programme sits within a recently created division within the Digital Directorate, Cloud and Digital Services Division.  This division brings together three programmes (Digital Identity, Scottish Government Payments and Scottish Government Cloud Platform) that are collectively focussed on achieving one of the main strategic outcomes within the 2021 Digital Strategy; build a suite of common platforms and component technologies to support increased efficiency in the delivery of public services across the public sector in Scotland.

Following significant technical design and development, testing, and approvals, in December 2021, the Scottish Government Payments Service, successfully processed its very first, one-off payment to recipients of a discretionary fund administered by Independent Living Fund Scotland (ILF Scotland) our first beta partner.

In June 2022, the Minimum Viable Service (MVS) was launched and officially moved the programme into a private beta phase. This beta launch mode saw ILF Scotland process the first of many weekly, regular BACS payment via the Scottish Government payments service. Starting small and allowing our service to scale over time, this regular payment run will consist of weekly payments to between 30 to 50 citizens. Ongoing monitoring, iteration and service improvement will continue as we progress towards the end of beta (April 2024)

The successful private beta launch follows a period of significant technical development and testing, undertaking the necessary assurance assessments, an external cyber security assessment and further rounds of inclusive testing with stakeholders and users.

Since MVS launch in June 2022, the payments service has processed 1,641 payments over 42 consecutive weeks (batches) to the value of £3 million and deployed 11 releases.

From April 2023 onwards, the Student Award Agency Scotland (SAAS) are confirmed as beta partner 2. With development underway and plans for a test student payment scheduled in June 2023 and plans for transition of payments throughout 2023-24 to be agreed.

Platform and Service development will continue throughout 2023-24 with technology partner Scott Logic as the programme continues to build functions and features in line with the technical and product roadmap. Ongoing development of the service management support function will continue as well as build internal capacity and capability within the Scottish Government. Digital will enable the effective transition of platform ownership from technology partner planned for March 2024.

Digital Identity Programme

The Digital Identity Programme will deliver a digital identity service for users to support access to online public services in Scotland. It continues to work with its partner, Scott Logic, to develop and deliver the digital identity service. The first live trial version (private beta) of the service was launched on 28 February 2023 in partnership with Disclosure Scotland. Users are using the digital identity service to access the results of their Protection of Vulnerable Groups checks. Following the private beta launch, further developments planned for later this year include adding other methods for two-factor authentication and identity verification and work to add the attribute store. The Scottish Government also plan to start on-boarding more public service customers during 2023 onwards.

Cloud First Programme

The Cloud First Programme enables the Scottish public sector to realise the benefits of cloud services by accelerating the adoption of modern cloud technology through the provision of a Scottish Government Cloud Platform Service with a secure architecture in alignment with National Cyber Security Centre principles as well as associated learning and a cloud community. The service will offer Amazon Web Services (AWS) and Azure environments and associated billing, security, cost efficiency and carbon monitoring services for Scottish Government core services and agencies hosting requirements. The programme is currently providing hosting and security services to Digital Strategy priorities Digital Payments & Digital Identity. The programme has also completed the migration from on-premises hosting of existing Digital Connectivity R100 and Digital Data GISaT to the Scottish Government Cloud Platform.

Progress made within the last year in relation to driving inclusive economic growth included the use of cloud services which will bring cost savings, especially when using hyperscale public cloud. The programme secured agreements with the hyperscale cloud providers which allowed for significant discounts. This included the AWS One Government Value Agreement (OGVA) - Crown Commercial Service and AWS which launched a new Memorandum of Understanding (MoU) for cloud computing services. The Azure MoU - Crown Commercial Service and Microsoft Azure agreed new pricing arrangement for public sector.

Each agreement has its own pricing and discount structures (22% AWS, 11% Azure of an organisations hosting bill), along with certain caveats, such as minimum spend, tiered discounts and minimum contract commitments. Initial cost benefit analysis case study was completed indicating favourable outcomes for customers using the Scottish Government Cloud Platform. An Invitation to Tender (ITT) was issued for a support supplier for 12 months whilst the permanent Scottish Government operational team is recruited.

Key achievements within the last year included the completed Release 1.0 (December 2022) – minimum viable product (current offer) – AWS (beta phase) available for live workloads. Azure (alpha phase) – for agreed pilot customers only (completed). AWS and Azure contracts were secured for the environments and Ministerial approval was given for the full business case for the establishment of the Scottish Government Cloud Platform Service. The Cloud Community continued to grow to a current 375 individual members from across Scotland's public sector representing over 50 organisations/services and in turn this has supported the demand management work. A series of demand management exercise were completed to ascertain what demand is available across the Scottish public sector and 74% of survey responses wanted to know more about the service.

Activity planned for the year ahead include Release 2.0 (May 2023) – AWS live with strategic architecture implemented, including improved and more automated operations; Azure (beta phase) – available for pilot customers with live workloads; Release 3.0 (August 2023) – AWS continues to be live, Azure is live and a new Cloud Platform Adoption Advisory Service and Cloud optimisation service are live; establishment of the permanent Scottish Government operational team; and to Confirm and Onboard an initial annual 20 workloads to the Scottish Government Cloud Platform.

CivTech

CivTech made significant progress in 2022-23. In May 2022, CivTech's 2021-26 Full Business Case (FBC) was approved by Ministers. This outlined a significant expansion of the programme, including an expanded Accelerator system in addition to a number of additional activities. The FBC includes up to £46 million contract funding for the development of innovative products and services for the public sector, with the majority of that funding going to ambitious Small and medium-sized enterprises (SMEs) with a further £13.5 million for the funding of CivTech operations.

The FBC envisaged a significant scaling of the CivTech team in 2022-23, and despite the recruitment constraints limiting this growth, CivTech delivered on all of its planned outputs for 2022-23. 20 Challenges were launched through CivTechs 7 and 8 [starting in June and October respectively]; the GovTech Cluster was brought near to launch with the identification and procurement of a 'cluster driver organisation'; the Challenge Sponsor support system was successfully launched on CivTech 7, and the Business Growth System was expanded to include a post-Accelerator Stage. Major strategic partnerships were launched, including Innovate for Nature, the first of CivTech's Innovate for… initiatives which bring together organisations in Scotland with common themes to work in partnership through the CivTech Innovation Flow; and a robust benefits realisation system reached its second stage of development.

In 2022-23, £5 million contract funding was awarded to CivTech companies, representing a significant increase over previous years. While company Key Performance Indicators (KPIs) for 2022-23 are currently being assembled and therefore cannot be reported at this point, reports clearly indicate that the growth in businesses, jobs created, societal benefits and direct financial benefits to the exchequer from CivTech Alumni companies have continued to grow.

While the spend and recruitment controls in place may constrain certain elements of the CivTech programme in 2023-24, delivery levels will continue to be maximised within those constraints. CivTech 9 will launch in July 2023 with 14–15 Challenges and up to £10 million contract funding available for solutions developed through CivTech.

AI Strategy Delivery Programme

The Scottish Artificial intelligence (AI) Register (https://scottishairegister.com/) launched in March 2023. It will make transparent the development and use of AI in the public sector and offer the public a simple and effective platform to have a say in how AI is used to make decisions and deliver public services. It is designed to help public sector organisations starting out on their AI journey by providing them with structure and guidance to adopt a consistent, ethical and open approach to developing and using AI. The Register includes a public-facing website providing detailed information about AI systems being used or developed in the public sector. This includes information related to the use of data (including personal data when applicable), how the system works, accountability, impact assessment, risk management and human oversight. The Register aims to track the entire life cycle of AI systems, from conception and development to use and retirement.

Throughout the last year we have continued to develop the analytical workbench (AWB) platform. We anticipate the full production version of the AWB to be available to users by the end of spring 2023. Built in the Edinburgh International Data Facility (EIDF), the AWB is creating a capability for the public sector that allows rapid adoption and development of new technologies, access to high-performance compute and the ability to collaborate across organisational boundaries to share resources, code, and ideas. The workbench is a safe, secure, permission-controlled environment that enables analysts to collaborate on data projects across organisational boundaries. The workbench provides easy access to a wide range of common, open-source analytical tools and the platform has the power needed for complex analysis with large datasets. The project has delivered virtual machines suitable for use with differing types of data, a choice of operating systems, easy to use mechanisms to get data securely in and out of the workbench and it also provides facilities for hosting interactive content.

Emergency Services Mobile Communication Programme (ESMCP)

The UK Home Office led programme is undertaking a refresh of the Business Case and Financial Model in April 2023 in order to seek reapproval from the UK Cabinet Office and His Majesty's Treasury, Major Projects Review Group to enter the next phase of delivery.

Going forward, a refreshed feasibility business case for the wider programme and a benefits realisation methodology reporting tool will be developed to highlight Scotland specific delivery. The activation of EE sites being built for Emergency Services Network (ESN) will provide early commercial access for local communities and businesses who otherwise have not had mobile telephony capability, thus playing a part in making the rural economy more attractive to SMEs.

Investment in ESN will mean improvements to 4G network coverage across Scotland. ESN will also enable greater access to the EE network and will complement the Scottish Government's Scottish 4G Infill (S4GI) Programme. Where users have access to other network suppliers, ESN sites will enable wider access to emergency 999 call in some of the most remote and rural parts of Scotland. The emergency services will take priority over all other network traffic even at peak times in busy urban locations. This will mean the emergency services and other first responders will have access to mission critical communications for operations and in addition, use the same secure and prioritised platform for sharing vital data information and expertise quickly and securely from the frontline when it is needed most.

The Home Office is working with their suppliers and their design teams to develop all new technology hardware to incorporate energy reducing measures, innovative product designs, minimise waste, reduce obsolescence and maximise value for money. For example, the programme is working with its suppliers to ensure technological hardware is compliant with current and future regulatory environmental requirements where appropriate. Going forward, activation of ESN sites will be compliant to environmental regulations and local planning controls. The availability of extended commercial mobile telephone network will also facilitate greater remote communications capability for local communities for personal and business purposes. Planning for solutions to be used for ESN will also continue to exploit the most efficient solutions whilst being developed to ensure the operational capabilities of the emergency services are not compromised in future use of ESN.

Strengthening Connectivity

Reaching 100% (R100)

Our Reaching 100% (R100) Programme, which is over £600 million investment in digital infrastructure, continues to deliver at pace across Scotland. In 2022-23 we extended the investment and reach of the programme which will enable us to deliver to more premises in some of the most rural parts of Scotland.

R100 has three main components: the R100 contracts; R100 Scottish Broadband Voucher Scheme (R100 SBVS); and commercial build.

The vast majority of R100 contract build will be full fibre, capable of delivering download speeds of 1,000 megabits per second (Mbps) – over 30 times faster than our superfast commitment of 30 Mbps. Full fibre is the most future-proofed broadband technology available so this outcome will put rural Scotland ahead of the curve, even compared to many urban areas. However, full fibre (otherwise known as FTTP (Fibre to the Premises) is more resource intensive than previous Fibre to the Cabinet (FTTC) broadband deployments, which used existing copper cables to connect into people's homes, and therefore takes longer to deploy.

By the end of February 2023, the three R100 contracts for North, South and Central had delivered over 20,000 contracted premises and an additional 5,200 non-contracted "overspill" premises (as at 28 February 2023). Volumes of overspill premises delivered continue to be significantly higher than projected at 25.7% of completed build against an average 8.8% projection. Greater than expected volumes of overspill premises benefits the Scottish Government by increasing Gigabit coverage.

R100 contract changes were agreed with Openreach for the R100 North and South contracts in summer 2022. This resulted in an additional 2,637 premises being added to the R100 North and South contracts. This was announced on 19 August 2022.

The programme delivered on time to lay 16 subsea fibre optic cables by the end of 2022. These cables will enhance Scotland's digital infrastructure resilience and connect 15 Scottish islands.

Since its launch in September 2020, the R100 Scottish Broadband Voucher Scheme has delivered almost 3,000 connections to voucher eligible properties. There are around another 650 connections either in build or going through the approvals process.

Looking forward into 2023-24, contract deployment will continue to deliver across the length and breadth of Scotland. We continue to explore opportunities to further extend the reach of the R100 contract build.

The infrastructure being delivered through the R100 programme will underpin a range of telecoms services, including broadband speeds that go way beyond the original superfast commitment. These engineering works will take time but will ensure that future-proofed and resilient broadband infrastructure reaches some of the most rural areas of Scotland.

S4GI

Through the Scottish 4G Infill (S4GI) programme, the Scottish Government is investing £28.75 million to deliver future-proofed 4G infrastructure and services to 55 so-called mobile "notspots", providing connectivity in rural and island areas from the Scottish Borders to Orkney and Shetland.

The programme continues to deliver at pace and is expected to complete with 4G service activation across all masts by June 2023.

The programme has been very successful in delivering digital connectivity to enhance the lives of individuals and businesses across rural and island communities in Scotland. It is improving everyday life for these communities, directly supporting wider plans for local tourism and enabling residents to access digital services and stay in touch with families and friends.

Transport (STPR2)

In 2019, Transport Scotland, commenced the second Strategic Transport Projects Review (STPR2), the first review having been published in 2008. Its aim is to help deliver the vision, priorities and outcomes that are set out in the second National Transport Strategy. This review of the strategic transport network's performance will inform transport investment in Scotland for the next 20 years (2022-2042) by providing evidence-based recommendations on which Scottish Ministers can base future transport investment decisions.

STPR2 considers the transport needs of Scotland's people and communities, and examines active travel (walking, wheeling, cycling), bus, ferry, rail and motorways and trunk roads as well as passenger and freight access to major ports and airports. These needs are reviewed from national and regional perspectives to reflect their different geographies, travel patterns and demands.

STPR2 provides an overview of transport investment, mainly infrastructure and other behavioural change recommendations, that are required to deliver the National Transport Strategy priorities and objectives of the Review.

The outcomes from STPR2 will: Help make Scotland more accessible for residents, visitors and businesses; Create better connectivity with sustainable, smart and cleaner transport options; and highlight the vital contribution that transport investment can play in enabling and sustaining Scotland's economic growth.

The final recommendations and suite of reports were published in December 2022 and its Delivery Plan expected to be published in 2023.

Roads

The Scottish Government is committed to completing the dualling of the A9 between Perth and Inverness, one of the biggest transport infrastructure projects in Scotland's history. We have already invested over £430 million delivering the programme. Work is continuing across the A9, with road users already benefiting from the dualled stretch between Kincraig and Dalraddy (operational September 2017) and between Luncarty and the Pass of Birnam, which opened fully to traffic in August 2021.

The section between Tomatin and Moy is in preparation for commencement of a new procurement, with the aim of achieving a contract award before the end of 2023. In 2022-23, we continued to progress design work and the statutory processes for the remaining eight schemes, as well as assessing procurement options. This is a complex exercise which is considering a pipeline of work in a form that can be delivered by the industry, supports the economic recovery post COVID-19 and minimises disruption to users of this lifeline route

When completed, the dualling programme will bring many benefits to local communities, businesses, visitors and road users living, travelling and working along the corridor including reduced journey times, improved journey time reliability, improved road safety and opportunities for active travel.

The Scottish Government is also committed to improving the A96 corridor and will take forward an enhancements programme that improves connectivity between surrounding towns, tackles congestion and addresses safety and environmental issues. The current plan is to fully dual the A96 route between Inverness and Aberdeen; however, we have agreed to conduct a transparent, evidence-based review of the programme which is well underway. We published the Public Consultation and Initial Appraisal reports on the Corridor Review on 22 December 2022 and are now pushing forward with the next phase of further detailed work to inform the remaining stages of the Review. These include a robust appraisal of the 16 retained options alongside a Climate Compatibility Assessment, with outcomes expected to be announced in during 2023 for final public consultation, before a final decision can be reached.

The A96 Inverness to Nairn (including Nairn Bypass) scheme is separate from the wider A96 review process which is currently being undertaken. We continue to progress the preparation stages of this scheme, which runs from Inverness to Hardmuir, to enable the completion of the statutory process.

The Scottish Government is committed to an infrastructure solution to address the A83 Rest and Be Thankful landslip risks. Delivery of a permanent and resilient solution is a priority, and we will continue to seek ways to achieve that as quickly as possible, noting all of the options require complex civil engineering. We will continue to take forward the necessary design and assessment work to identify a preferred option by spring 2023. These options range from traditional roads with localised structural protection, to tunnel and viaduct solutions. The range of engineering structures reflects the challenge of building resilience into the route.

In recognition of the urgency to find a solution we are also progressing work to look at a medium-term resilient route through Glen Croe. Proposals for a medium term resilient route were announced on 23 December 2022. A detailed programme to implement these improvements is in development, with works anticipated to be carried out on a phased basis starting later in 2023.

We also continue to take forward the detailed development and assessment of the preferred option for improving the A82 between Tarbet and Inverarnan.

Ferries

The Scottish Government will invest at least £700 million in ferries infrastructure over the five years of the Infrastructure Investment Plan (IIP) and this investment will deliver strengthened lifeline ferry services for our island and remote communities and businesses. In 2022-23, this commitment enabled the deployment of the purchased vessel MV Loch Frisa and charter of the MV Arrow; progressed major development and investment in key harbours such as Lochmaddy, Uig and Troon and completion of infrastructure works including a new terminal building at Tarbert (Harris), delivered good progress on the two new Islay vessel builds and enabled a further contract to be awarded for two new additional major vessels for the Little Minch routes. All vessel and harbour projects listed in the IIP are now underway as part of the long-term plan.

In 2023-24, we will continue monitoring and reporting key milestones in the progress of the six major vessels currently under construction. We will continue engagement with CMAL and Ferguson Marine Port Glasgow to confirm delivery dates for Hull 801 (MV Glen Sannox) in 2023-24 and the future programme for delivery of Hull 802. We expect to see completion of key work elements on existing port projects and to see contracts awarded for port improvements on the Islay routes. Work will continue on the business cases for the Small Vessel Replacement Programme and other vessel replacement projects. In addition, we will continue work on the Islands Connectivity Plan, including consultation on the long-term vessels and ports plan.

Inclusion and Growth

City Region / Growth Deals

City Region and Growth Deals are a key tool for the Scottish Government in driving inclusive growth throughout Scotland. This is achieved by working together with local partners to identify and support projects that target and address unique regional needs and concerns. We are committed to implementing Deals covering all of Scotland, allocating £1.9 billion to the programme.

City Region and Growth Deals continue to fund a diverse range of successful projects. Some of the most notable developments in the past year include:

Glasgow City Region Deal

The main span of the new pedestrian and cyclist bridge linking Sighthill with Glasgow

City Centre was installed over the M8 and is now open to the public. This new bridge will form an active travel route between Sighthill and the city centre and is part of the £250 million regeneration of Sighthill, the biggest such project in the UK outside of London. The new bridge will also be part of a wider active travel network connecting Sighthill, the city centre and neighbouring communities in North Glasgow.

The £215.7 million City Deal and North Lanarkshire Council funded Pan-Lanarkshire Orbital Transport Corridor Project, focuses on improving orbital and Pan-Lanarkshire connections across the City Region with the aim of realising opportunities for commercial and housing development at the Ravenscraig site, with construction works underway.

The Inchgreen Project in Inverclyde, providing utilities and works at the Inchgreen deep-water quay and the surrounding industrial land, is underway and looking to be completed by the proposed date of December 2023.

Aberdeen City Region Deal

The City Region Deal's projects supports Aberdeen in its ambition to be an energy transition capital. Significant investment in innovation, digital connectivity and infrastructure is helping to diversify and transform the region's economy.

The Net Zero Technology Centre (NZTC) is developing and deploying new technologies to reduce energy emissions and to support an integrated net zero energy system. It has screened over 1,800 technologies, resulting in more than 175 field trials and 33 commercialised technologies, since opening in February 2017.

Another significant area of NZTC's focus is on supporting energy startups through its TechX Clean Energy Accelerator - 12 more startups joined the intensive 15-week programme in February 2023, the previous 45 participants collectively having generated more than £10 million in revenue.

Inverness and Highland City-Region Deal

Since the Deal was signed, 211 affordable homes have been constructed with planning approval for 380 units to date - 11 assisted living Fit Homes are completed, with a further 18 nearing completion. The University of the Highlands and Islands Centre for Health & Life Sciences completed construction in March 2023. The Inverness Castle project also entered delivery and is also progressing on time with construction on site beginning in April 2022 and expected to complete in 2025.

Regional Partners have estimated that the Deal will have the following economic benefits and will: help to rebalance the population with the aim of retaining and/or attracting an additional 1,500 young people in the 18-29 age group over the initial 10 year Deal period; create an additional 1,125 direct jobs as a result of City-Region Deal projects with a further 2,200 additional jobs in the construction sector; help to up-skill the labour market and contribute to moving towards a high skilled high wage economy, improve productivity and real wages which are estimated to increase by an additional 1.3 per cent and bring an additional £100 million per annum to the regional economy; create 6,000 new houses over 20 years of which 1,600 will be affordable homes; and deliver private sector leverage from house building and through opening up land for commercial development, will see an additional return over a 20 year period of around £800 million being invested in the economy of the city and region.

As part of the Inverness and Highland City-Region Deal, we are progressing plans for a single carriageway road, including enhanced facilities for non-motorised users, connecting Inshes and Smithton along with the grade separation of the A9/A82 Longman Roundabout. Activity planned for the year ahead includes continuing the detailed development and assessment work of the preferred option for the A9/A82 Longman Junction scheme along with continuing to progress the A9/A96 Inshes to Smithton scheme through the statutory process.

Edinburgh and South East Scotland City Region Deal

Good progress has been made on business case development and delivery for projects within the Deal since it was signed. Within the Data Driven Innovation theme, the Bayes Centre and National Robotarium are complete, with the Edinburgh Futures Institute aiming to open to students and the Usher Institute on track to complete in 2023. Business units have been delivered in Fife and the Central Borders to ensure that businesses and communities are fully able to engage in new opportunities. And site clearance for the new Dunard Centre, a concert hall and performance venue being delivered under the Culture theme, began in February 2023.

The City Region's Joint Committee have approved the proposed scheme at Sheriffhall Roundabout, which will provide a grade-separated junction designed to relieve traffic congestion and introduce new active travel facilities for walking, wheeling and cycling. We have progressed the proposed improvements at Sheriffhall through the statutory process with a Public Local Inquiry held between 30 January and 8 February 2023. The Public Local Inquiry Reporter is now considering all evidence presented during the inquiry along with objections received before making recommendations to the Scottish Ministers for consideration.

Stirling and Clackmannanshire City Region Deal

Work has continued to deliver the projects outlined in the signed Deal, including the first phase of Scotland's International Environment Centre at the University of Stirling and the Walk, Cycle Live Stirling active travel routes, with further progress anticipated in the coming year.

The Deal forecasts that 5,000 jobs will be created and £640 million of private investment will be unlocked.

Tay Cities Region Deal

Significant progress has been made since the Deal was signed with business case approval for over £160 million of the total capital investment, of which £78 million had been drawn down by regional partners (to end of 2022).

Work is continuing on projects, including those at the Universities of Dundee and St Andrews, the James Hutton Institute and Pitlochry Festival Theatre, with progress expected to include the opening of Perth Museum, which will host the Stone of Destiny when it returns to the region.

Regional partners have developed a Benefits Realisation Plan to demonstrate the impact of the Deal, including progress towards inclusive growth and net zero, and will fully implement reporting on the benefits of the Deal this year. To the end of reporting year for the Deal at September 2022, 677 jobs have been created and £123 million of investment in the region secured.

Ayrshire Growth Deal

The Scottish Government is a full partner in the £251.5 million Ayrshire Growth Deal, which will see transformational investment in projects across Ayrshire to support long-term inclusive growth. The Deal is working with Scottish Government to implement a holistic approach to decarbonising projects to ensure that net zero commitments can be achieved. Ayrshire is piloting this for the wider Deals programme.

It is estimated that the Deal will create 7,000 new jobs and unlock an additional £300 million from the private sector. Scottish Government investment includes £40 million for an Economic Infrastructure Programme which includes innovative projects around engineering, manufacturing and digital automation, £30 million for an Aerospace and Space Programme and £18.5 million for tourism and regeneration.

The development of a fully integrated Enterprise and Innovation Hub which will establish an entrepreneurial ecosystem to stimulate innovative business practices between new and established businesses. This ecosystem is intended to encourage the development of new digital and cyber security products and services, responding in particular to the needs of the energy, health and space/aerospace sectors.

HALO Kilmarnock was awarded the Best Regeneration Project at the 2022 Scottish Property Awards. The award in recognition of 'HALO Enterprise and Innovation Centre transforming a deprived urban site through the delivery of a mixed-use property development which has environmentally improved the local area while generating a positive economic and social impact.

Borderlands Growth Deal

Following Deal signing in March 2021, officials continue to work with partners on the development of business cases that will deliver economic inclusive growth across the Borderlands area.

Recognising the economic and social ties between the south of Scotland and north of England and the desire of regional partners to work together on shared challenges and opportunities, the Borderlands Deal is the first cross-border Deal, delivering across five local authority areas with two in the South of Scotland. The Deal's ambition is to unlock the region's potential as an economic hub to encourage new business and job opportunities under the priority themes of Enabling Infrastructure, Improving Places, Supporting Business, Innovation and Skills, and Encouraging Green Growth.

It is estimated that the Deal will benefit 1.1 million residents, deliver an estimated additional 5,500 job opportunities, attract more than four million extra tourists to the area and improve mobile and digital connections, and unlock investment in towns across the area and generate around £1.1 billion of additional GVA (Gross Value Added) for the Borderland's economy.

Moray Growth Deal

Since the Full Deal agreement was signed in December 2021, the Digital Health project (which aims to provide a rural centre of excellence for digital health care innovation) and the bus revolution project (provision of a low-carbon, demand-responsive bus service to improve public transport connectivity in Moray) have entered delivery. Officials continue to work with regional partners to further develop the detail of the remaining Deal projects and to maximise inclusive growth opportunities.

As well as creating high-quality jobs and opportunities across Moray, the Deal will address key growth challenges, including keeping young people in the area to live and work, and addressing gender imbalances in key sectors of the economy to unlock future potential.

The vision for the Deal is built on four pillars; Connections; Business Support, Skills and Employability; Moray the Place/Brand; and Moray's Priority Business Sectors that will unlock investment and drive inclusive and sustainable economic growth across the area.

Regional Partners estimate that economic benefits arising from the Deal will include: directly and indirectly creating over 3,500 jobs associated with the economic benefits accrued from growth deal projects (of these, 450 jobs will be directly created as part of growth deal project delivery); attracting an additional 50,000 tourists; constructing over 300 affordable new homes; supporting 450 businesses to scale up to increase the value of the Moray economy by £82 million; creating new and improve existing facilities for businesses; and creating an enhanced culture and leisure offering for local people to make Moray a more attractive place to live and work.

Argyll and Bute Growth Deal

The Heads of Terms agreement was signed in February 2021 and officials continues to work with the partners to further develop the detail of the projects to be supported through the deal and to maximise inclusive growth opportunities.

The Deal's economic development benefits and targets will be confirmed at the full deal stage. The Deal has however indicated that investment will be targeted across three key drivers: connecting high value business sectors with national and international business markets; attracting additional skills, training and learning opportunities; new residents, visitors and businesses; and growing by doing more of what works; and making more of Argyll and Bute's natural and built resources.

Islands Growth Deal

Since the Full Deal agreement was signed in January 2023, the Islands Centre for Net-Zero project has been approved and officials continue to work with Islands Deal partners to further develop the detail of the remaining Deal projects to maximise inclusive growth opportunities.

The Deal has three broad themes: leading the way to a low carbon future, which will contribute to net-zero commitments by supporting energy transition, delivering port infrastructure, and piloting decarbonisation in an island context; supporting growth and future industries, which will see the development of significant island tourism and cultural assets, and innovation in key Space, Food and Drink and Creative Industries sectors; and building thriving and sustainable communities, which will see the expansion of existing learning facilities, sustainable housing provision, and investment in a skills programme targeting key sectors including decarbonisation and renewable energy.

It sets out a number of collaborative and Island specific proposals designed to address the islands' demographic challenges, as well as supporting business innovation and the move towards net zero.

Regional partners anticipate that the Deal is likely to create up to 1,300 sustainable jobs across the three island groups aimed at retaining and attracting young talent.

Falkirk Growth Deal

Outline business cases are in development for a range of projects to support innovative industry and great places in Falkirk and Grangemouth. This work is expected to progress in the summer of 2023 towards full Deal signing by the end of 2023-24.

Falkirk partners predict that the proposed interventions will generate around £802 million of GVA (Gross Value Added) uplift, approximately deliver an additional 2,000 jobs in the region and attract in excess of £1 billion of private investment.

Additional Transport links alongside City Region Deals

We are progressing a range of infrastructure improvement projects related to the City Deals. In 2023-24, we will continue to progress the A90/A937 Laurencekirk Junction Improvement through the statutory process. The Cross Tay Link Road is the central element of the Perth Transport Futures Project and the biggest infrastructure project ever undertaken by Perth and Kinross Council. It involves the construction of a new 3-span bridge over the River Tay and a six kilometre stretch of new carriageway linking the A9 and the A93 to Blairgowrie and the A94. As at the end of 2022-23, Transport Scotland had contributed £25 million towards the project with a final £15 million earmarked within the 2023-24 budget.

Stornoway Growth Accelerator

In March 2022, the contract for the Stornoway deep water terminal was awarded and since then construction has been underway. The project has been progressing on schedule and on budget and is due to complete in December 2023. Parallel work is ongoing to ensure maximisation of benefits and implementation of any associated island infrastructure developments required to respond to the increased economic activity expected from the new terminal.

Activity planned for the year ahead will focus on delivery of the contract, with the works due to conclude by December 2023. There will be regular reporting to Ministers and work will also be undertaken to ensure maximisation of benefits and implementation of any associated island infrastructure developments required to respond to the increased economic activity expected from the new terminal.

The project has been progressing as planned aside from the discovery of the wreck of SS Portugal which needs to be removed from the seabed as it is a navigational hazard. Stornoway Port Authority's original plan was to cut up the wreck underwater but this approach was abandoned. There are now also environmental concerns about moving the wreck and the Marine Scotland Licensing and Operations Team are currently examining possible viable approaches.

National Islands Plan – Islands Programme

Support for island economy sectors is mainstreamed and so sectoral support lies across many areas - all of which contribute to the Wellbeing Economy. Additionally, the Islands Programme is investing £25.8 million of Infrastructure Investment Plan capital funding over the period of this current Parliament to ensure delivery of the National Islands Plan.

This investment supports projects that encourage population growth and stem population decline; deliver on our net-zero ambitions in a way that no-one is left behind; and support a green economic recovery from the ongoing impacts of brexit, the COVID-19 pandemic and the socio-economic impacts of the war in Ukraine.

The 2022-23 Islands Programme delivered a £4.45 million funding package to help improve infrastructure on Scotland's islands. This capital investment supported all six island local authorities to fund the improvement, creation or safeguarding of locally developed infrastructure projects that align with the Strategic Objectives of the National Islands Plan.

In 2022-23, as agreed with COSLA (Convention of Scottish Local Authorities), the Islands Programme was run as competitive bid model, with the six local authorities as the lead applicants. Fifteen applications were received in total and individually ranged from £72,000 to £1,500,000. Eleven projects were approved and each of these received a share of the £4.45 million investment.

The totality of investment was spread across 31 islands. Successful applications included projects directly supporting population retention and growth, new facilities to deliver services helping to alleviate child poverty, innovative circular economy solutions, measures to address climate change impacts, development of digital and community hubs, management of tourism impacts, iconic heritage projects, and support for key local services.

In 2023-24, £4 million has been committed to delivery of the Islands Programme. This is being delivered in partnership with local authorities via a streamlined competitive bid model to ensure delivery of the National Islands Plan, by supporting a range of areas, including tourism, infrastructure, innovation, energy transition and skills. The islands Programme was launched on 31 January 2023, with a deadline of 21 April 2023 to allow awards to be made in early summer of 2023.

Boosting Competitiveness

Cairngorm Mountain

Following a range of technical, weather and COVID-19 related challenges which led to the overall project timescale being extended, the funicular reinstatement works were completed in November 2022. A new control system was also installed, and Department of Transport approval was obtained in January 2023, and the funicular immediately returned to service. Additional investment from Highlands and Islands Enterprise (HIE) in a new play park, camper van facility and other improvements to the resort, enabled it to continue to attract visitors whilst the funicular was not running. HIE also supported a major refurbishment of the Ptarmigan building into which funicular passengers alight at the top of the mountain. The Cairngorm masterplan was published in June 2021 and sets out a long term vision and key strategies for the development of Cairngorm estate to benefit the wider economy, protect and enhance the environment and create new educational opportunities amongst other outcomes. A planning application to introduce mountain biking, a masterplan strategy, was recently approved by the national park authority.

Visitors are once again able to easily access the top of the mountain, whether to enjoy winter snowsports or simply experience the mountain environment across the seasons. Delivery of the masterplan will also get underway with the development of mountain biking the first planned investment. HIE have progressed the planned car park upgrade and will be working with the Cairngorms National Park Authority on active travel plans, visitor management from the Ptarmigan building, decarbonisation opportunities, scoping options for replacement of the Day Lodge, ongoing habitat management and restoration, and improved uplift.