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Islands Deal: £100m in government investment secure but ‘still a mountain to climb’ for future projects says Orkney council leader

Islands Deal
From l to r: leader of comhairle nan eilean siar Paul Steele, Lord Malcolm Offord, Ivan McKee MSP, leader of Shetland council Emma Macdonald, and the leader of Orkney Council James Stockan. Image: Andrew Stewart/DCT

This morning saw local, national, and UK politicians gather in Kirkwall, Orkney, for the official signing of the Islands Deal – a £100m investment in the economic futures of Scotland’s three islands groups.

Through the signing, the Scottish and Westminster government have each committed themselves to £50m investments.

This will be used to launch a portfolio of 16 projects hailed as transformative for the future economies of Orkney, Shetland, and the Western Isles.

Some of these projects, such as an Islands Centre for Net Zero, will cover all three of the islands areas.

Others are specific to one of the three islands groups, such as a vertical farm project and a Scapa Flow Future Fuels Hub for Orkney.

The anticipated result: 1,300 jobs and £393 million of investment in Orkney, Shetland, and the Outer Hebrides.

However, nearly triple this initial investment – another £293m – has to be found in match funding to bring the projects to completion over the next decade.

Just ahead of the signing, Orkney council leader James Stockan called finding that match funding “the biggest challenge we have”.

Milestone Islands Deal signing just the beginning?

To mark today’s milestone deal signing event, the leaders of Orkney’s council were joined by their counterpart from Comhairle nan Eilean Siar, Paul Steele, and Shetland Islands Council leader Emma Macdonald.

From the Scottish Government was its minister for business, trade, tourism and enterprise Ivan McKee.

Westminster was represented by Scotland Office Minister Lord Malcolm Offord and Felicity Buchan MP, the UK government’s parliamentary under-secretary of state for levelling up.

While the signing of the deal secures the two governments’ £100m investment, it also marks the beginning of the hunt for £293million in match funding to bring the projects to completion.

At a time when the general public in the three islands groups is perhaps more worried about paying their heating bill, why should they be enthusiastic about the deal signing?

Mr Stockan said: “Everyone knows the economy is the baseline for a vibrant and purposeful place. We have to have employment going forward.

“If you don’t reinvest then the jobs you have tend to wither away.

“What we’re really doing with this growth deal is making sure the islands remain vibrant and they contribute to the national economy.

‘If you don’t reinvest, jobs wither’

“The average person on the street benefits because the place gets a lift. There are things happening that benefit the whole economy.

“We can see clearly when economies collapse and areas don’t have new things happening, how areas become more depressed.”

Mr Stockan also stressed the importance of the size of the deal the islands are getting.

With the islands deal featuring the largest per-capita deal for the whole of Scotland, he said the investments from the government won’t just benefit the islands.

The investment will be felt through the supply chains that go to the islands as well.

He said: “It’s really important that any country supports the periphery – these are where the biggest challenges for employment will come.”

Asked how the investment will be split between three islands areas, he said it would be even.

This is despite Orkney having the least number of projects under the Islands Deal.

He was asked how the three councils decided on the projects they wanted in the deal.

Council leader is delighted – but more challenges lie ahead

He said: “We had a long list of projects we wanted to develop.

“We then had to see which ones fulfilled the criteria for the government – to secure jobs, being forward-looking, fitting into net-zero opportunities.

“So there was a process of picking the ones that the government was willing to fund.”

While today is certainly a huge milestone in securing the islands deal, it comes during a period of particular financial instability.

Giving an insight into the process behind getting to today’s signing, Mr Stockan said this deal is the last growth deal of its kind for Scotland.

He said: ” We’ve been planning this for a long time and we’re delighted at where we are with it.

“But we have to realise that the financial climate is much more challenging than it has been for growth deals before.

“We’re delighted with the signing this off, but we have a mountain to climb to make sure we can secure and develop all the projects.”