Dundee City Council leader John Alexander has described the delays in £350 million being paid to councils in Tayside and Fife from the Treasury as “ridiculous”.
Mr Alexander has written a letter, co-signed by the leaders of Angus, Perth and Kinross, and Fife councils, all asking for Chancellor Rishi Sunak to personally intervene in “hand the cheque over” for the Tay Cities Deal investment.
Partners in the Tay Cities Region Deal rubber-stamped the £700m agreement during an event in Perth in November 2018.
It commits the UK and Scottish governments to investing a combined £300m in the region over the next 10-15 years, with a further £400m of investment from a range of partners expected to be secured over the next decade – creating more than 6,000 jobs.
However, no cash has been paid despite business cases being made for several projects, with fear they could now be in jeopardy.
Mr Alexander said: “As leaders of the four local authorities involved in that, we’ve been very clear that there is a real need to get this deal signed, and to start progressing with the detailed business plans that we have for each of the projects within that.
“We’ve co-written – the leaders of Fife, Perth and Kinross, Angus and Dundee – a letter to the chancellor, asking for his personal intervention to make this a reality.
“Because, it is becoming ridiculous, the length of time that this deal has taken.”
He added: “If we can unlock some of that £350m of investment across this region then that will deliver results, it will deliver jobs.
“So, time is of the essence, we want to see the Treasury move and give that commitment that they are going to sign on the dotted line and get this deal delivered.
“There has been no response from the Treasury as of yet, obviously the four council leaders have not just gone out and done this very quickly, we have tried to engage with the key partners and get it moving forwards as quickly as we can.
“Our officials have been working very well with both governments but this really requires political intervention at the highest level.
“Until we get any clarity from the Treasury, we’re all sitting here not knowing when – or if – the deal is going to be signed.”
Alison Henderson, chief executive of the Dundee and Angus Chamber of Commerce, said: “I can’t believe we are still waiting for that agreement to come through, because the longer that happens, the project owners have to continually take a look at a bit of their project and say, ‘Is it still fit for purpose, do the numbers still add up, do I need to revise it?’”
Ms Henderson said “an untold amount of time and investment” had been put into the deal by the partners involved, and project owners.
She continued: “John used the word ‘ridiculous’ – I couldn’t agree more.
“I can understand that the Treasury is massively focused on the coronavirus mechanisms of support; I fully, fully appreciate that.
“But this is absolutely vital, and the longer we wait, the longer a look that the project owners have to take at their projects and say, ‘We devised those for a need, three or four years ago’, and the need is changing.
“I know they are being very conscious of that, and looking at the recovery how it fits into what the economy needs right now. But we need it over the line, it is getting in the way and will cause significant problems the longer it goes on.”
Councillor Alexander said he felt a “myriad of reasons” had led to the cash not yet being paid, including general elections in 2017 and 2019, the EU Referendum in 2016, and other budget delays.
He said that he wanted to have the cheque signed by December 2019 – a delay in itself – and most recently he had hoped it would have been announced as part of last week’s UK Budget.
He added: “We had more than a year, even before Covid-19 struck, to get this deal signed off, so as far as I’m concerned we’ve done everything we can, locally. This really just requires the final sign-off from the Treasury.
“They’ve already agreed to the quantum of the money, they’ve agreed to the outline of the projects, so I just don’t understand why there isn’t that political impetus to get this over the line.”
A Treasury spokeswoman said: “The UK Government is committed investing in all parts of the UK, and is providing £150m for the Tay Cities Deal to create jobs and enable growth in Dundee, Perth and the wider region, which is part of our investment of £1.4 billion in City and Growth Deals across Scotland.
“We are working hard with local partners and the Scottish government to make the deal a success.”
Part of the letter, which can be read in full below, from the council leaders to Chancellor Rishi Sunak reads:
“Regrettably, there has been extensive slippage since the signing of Heads of Terms, and it now appears that there is a real danger that the Deal cannot be signed in June or July, and it may be as late as August before final agreement is reached. This is unacceptable both to local partners and, we would anticipate, you as Chancellor of the Exchequer.
“We know that as Chancellor, you are concerned about the economic impact of the Covid-19 crisis. From our perspective, the Tay Cities Deal is a key measure to aid economic recovery after the current crisis. It has the potential to secure over 6,000 jobs and lever in over £400m of investment over the next 10 years.”
Councillor David Ross, chairman of the Tay Cities Joint Committee and co-leader of Fife Council said: “The Tay Cities Deal forms an important component of Tayside’s economic strategy over the coming 10 years and will, once signed, deliver thousands of jobs across the four council areas.
“It will also help advance some of the most innovative and high-growth sectors within our region, through projects such as Eden Campus Energy Centre by the University of St Andrews which is dependent upon unlocking this investment. Time is of the essence for the UK Government to commit to a 10-year programme.”
Councillor David Fairweather, leader of Angus Council said: “We have all worked in good faith and those that have contributed and led the projects have been very patient but that patience can only go so far.
“Angus has many strengths and proposals within the Tay Cities Deal will help advance manufacturing, a key growth sector for our economy as well as delivering a £26m fund specifically to develop strategic projects in Angus. There can be no further delays in deploying this investment.”
Councillor Murray Lyle, Leader of Perth & Kinross Council said: “The relationship between local and national governments is strong but we also need to recognise that these delays have become a distraction from our shared ambitions to create jobs.
“We need certainty and given that we’ve had an outline of the majority of the spend for more than 19 months, there cannot be any legitimate reason to continue to see this deal delayed. Perth City Hall had already began works, in good faith, and we stand ready to help the UK Government deliver on its economic and environmental ambitions through projects such as the world’s first advanced plastic reprocessing facility here in Perthshire.”