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Government ministers to announce £1billion deal for Inverness

Inverness continues to prove popular with tourists
Inverness continues to prove popular with tourists

Ministers from the UK and Scottish governments will join forces in the Highland capital today to unveil a city deal expected to unlock £1billion over 20 years.

The Press and Journal can exclusively reveal that the long-awaited announcement includes an initial confirmed investment of £315million.

The deal is made up of a £135million contribution from the Scottish Government, £53million from the UK Government, plus a further £127million from Highland Council and other regional partners.

The cash injection will help deliver a new link road between the A9 Perth route and A96 to Aberdeen – designed to ease gridlock in the city.

It will also help transform the iconic Inverness Castle into a major new tourist attraction, as well as paying for 6,000 new homes, and investment in research and teaching at the UHI campus.

Scotland Office Minister Andrew Dunlop and Scottish Infrastructure Secretary Keith Brown will formally announce the details at a ceremony in the city centre.

Lord Andrew Dunlop
Lord Andrew Dunlop

Chancellor George Osborne, however, has pulled out of his planned visit to Inverness to try to bolster support in Westminster after his Budget unravelled over the weekend.

Welcoming the agreement, Mr Brown said the deal would deliver significant long-term benefits for both the region and Scotland as a whole.

He added: “This deal provides an opportunity to enhance and accelerate the delivery of long-term aspirations held by the Scottish Government and the Highland Council, the impact of which could help increase the population, create thousands of jobs and help to up-skill the local labour market.”

Inverness MP Drew Hendry also hailed the investment, which he said would enable “transformational change”.

He added: “Inverness and the wider region has potential in abundance and this deal will help us own that potential, for the people who work and live here as well as the visitors we welcome to the area.”

Drew Hendry
Drew Hendry

And Angus Robertson, Moray MP and SNP leader at Westminster, also welcomed the deal and said it was hugely important for the whole of the north of Scotland.

“A City Deal for Inverness is massively important for the surrounding area, including the wider Highlands and Moray in particular,” he said.

“The knock-on consequences of the enhanced status for Inverness should be welcomed across the north of Scotland, and I know it will be warmly welcomed in Moray.”

A UK Government source said last night that the Scottish Government’s contribution was higher because it included investment in devolved areas, such as transport projects.

He welcomed the additional funds, adding: “If the UK city deals can lever in more money, be it private capital or devolved spending, then it’s a good thing for the area.”

He also confirmed the money coming from UK Treasury coffers was “100% new money for new projects” and said the deal was expected to provide a £1billion boost longer-term.

The news of the Inverness and Highland City Region Deal follows the confirmation in January of a £250million deal for the Aberdeen City Region, funded 50/50 by the two governments.

Funding worth £254million for infrastructure in the north-east was separately announced by the SNP, albeit on the same day as the Aberdeen deal.

Over two decades, the Highland deal is estimated to be worth close to £1billion, with the initial £315million of collective investment in the first half of that period expected to unlock further funding down the line.

The eagerly-anticipated financial package will support major infrastructure projects in Inverness and the surrounding area.

Schemes on Highland Council’s wishlist include a major new sports centre and city-centre enhancements.

A £3million advance on the larger deal, which had already been confirmed, is to be spent on public wifi in the city centre and enhancing the grounds of the castle.

The Scottish Government said funding would be targeted towards improving the region’s transport and digital connectivity networks, fostering innovation of high growth businesses through the creation of a Northern Scotland Innovation Hub, promoting tourism and delivery of local housing and assisted living schemes.

Today’s ceremony is due to take place at the city’s Centre for Health Science, and will also be attended by council leader and convener Margaret Davidson and Isobel McCallum, respectively.

Scottish Infrastructure Secretary Keith Brown
Scottish Infrastructure Secretary Keith Brown

Lord Dunlop and Mr Brown will also give short presentations.

The P&J understands that as late as Thursday, Mr Osborne was due to play a role similar to David Cameron’s on the day of the Aberdeen deal announcement.

But a Treasury source confirmed yesterday he will not be attending today’s ceremony.

The source also denied it was ever the plan for the chancellor to be in Inverness, although insisted he “definitely wants to visit”.

Mr Osborne is expected to spend the day in Westminster after he was forced to abandon £4billion of disability benefit cuts outlined in the Budget.

He is due to take the unusual step of closing the Budget debate following the resignation of Iain Duncan Smith as work and pensions secretary over the welfare reforms on Friday.

The prime minister’s spokeswoman confirmed yesterday the UK Government would bring forward alternative proposals to those outlined in the Budget in the Autumn Statement.

Asked if Mr Cameron still had full confidence in his under-fire chancellor, his spokeswoman replied: “Absolutely.”