£1bn City Deal ‘can’t be spent on new schools’

Picture: John Devlin
Picture: John Devlin
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Cash-strapped council chiefs will not be able to use money from a potential £1 billion City Deal to build schools for thousands of new homes needed over the next ten years, the Evening News has learned.

Leaders of councils across the Lothians have banded together to bid for the funding boost, and officials in Edinburgh have already suggested that the Capital’s share could be used to plug a £500 million gap for new schools and roads.

This is a deficiency in the way we are planning the city, and that needs to be addressed

Ian Perry

However, the News understands that it is “very unlikely” that the city would be able to use the cash for new schools or classroom extensions, with City Deal agreements between the UK Treasury, the Scottish Government and local authorities usually ring-fenced for projects which help grow economies.

The news comes as councillors on the planning committee rejected an application to build 61 homes at Gilmerton Dykes Road because of a funding gap for new infrastructure.

Even though committee members said they did not oppose the plan in principle, it was thrown out because developers said they could only pay £610,000 towards a total cost of £1,692,152 for transport and school improvements.

Planning convener Ian Perry said the application was just the first in an impending “logjam”, with the same deficit expected to be replicated across the Capital at sites in the recently-approved Local Development Plan.

Council officers have said the city-wide gap is at least £217m, but councillors privately put the sum at closer to £500m.

Councillor Perry said: “As a planning committee, we are in between a rock and a hard place. We’re now faced with the possibility of a quite major deficiency in the infrastructure payments we can apply to this. That is a deficiency in the way we are planning the city, and that needs to be addressed.”

He added that he would be meeting with Communities Secretary Alex Neil to plead for Scottish Government cash.

Conservative planning spokeswoman Joanna Mowat said providing school places was a statutory responsibility for the council, and that using City Deal cash to fund housing needs was a wasted investment.

Cllr Mowat said: “The City Deal should only be used to pay for infrastructure that allows growth to take place. The provision of schools is a statutory requirement and you can’t argue that it provides something additional, over and above what the council should already do. In other areas, City Deals are looking at stimulating growth and employment opportunities. We shouldn’t be saying to developers, ‘we’ll help pay for you to concrete over the green belt’.”

The Scottish Government signalled it was open to providing funding through the Scottish Futures Trust. A spokesman said: “Preliminary discussions have already taken place around infrastructure funding models, and the Scottish Futures Trust will provide support in developing proposals.”

Council leader Andrew Burns said: “The council’s team working with neighbouring authorities on the Edinburgh and South East Scotland City Region deal is fully aware of the projected costs to deliver infrastructure for future development and will consider these as well as many other issues when developing a regional City Deal proposition to be discussed with the UK and Scottish governments.”