SFT should be scrapped, says minister

Opposition parties in Scotland are calling for the Scottish National Party’s (SNP) flagship PFI substitute to be scrapped in the face of the growing economic crisis.

The new leader of the Scottish Labour, Iain Gray, said that the Scottish Futures Trust (SFT) would create an investment black hole putting 100,000 jobs at risk. Speaking at First Minister’s questions Gray asked SNP leader Alex Salmond to "rethink his economic strategy, restart investment in infrastructure and begin to re-skill Scotland to meet the challenges of the difficult days ahead."

He said that instead the Scottish Executive should restart its PFI/PPP pipeline and bring forward new building projects. "In the national interest, will the first minister set aside for the moment the futures trust to realise funding for schools, hospitals and transport?" he said.

But Salmond hit back saying that PFI was part of the problem not the solution with its "credit card" repayment levels. Instead he called for the government to bring forward the capital budgets and deliver a £1bn funding package to save Scotland’s economy from recession.

However the SFT could struggle to attract PFI/PPP participants. A lack of information on exactly how the new funding model will operate has led to industry interest cooling on the scheme. CBI Scotland is among those calling for clarity on SFT. He said: "CBI members have voiced growing concerns that the current hiatus in agreeing what the SFT will do, and how it will do it, is unhelpful to the construction sector."