A £500 million authorities scheme set as much as improve Scottish enterprise development, has paid out simply £40m in three years.
The Scottish Development Scheme was described by First Minister Nicola Sturgeon as a “half billion pound vote of confidence in Scottish enterprise” when she introduced the launch of the initiative in 2016.
Nevertheless, the SGS, which is predicted to make use of public sector funding to leverage the personal sector to assist companies develop, confronted criticism when it was revealed that wasn’t arrange till June 2017, and because of this hadn’t paid out any cash to assist Scottish enterprise.
Now, in a letter to Holyrood’s financial system committee, the Finance Secretary Derek Mackay has revealed that since then, simply £40m has been drawn from the fund.
MSPs on the committee had requested Mr Mackay for an replace on the SGS as a part of its work on price range scrutiny.
The letter states that as of August 31, a complete of £149.5m private and non-private funding has been made in 233 firms – an quantity made up of £39.8m funding from the general public sector and £109.7m from the personal sector.
The general public sector funding consists of £24.1m by way of Scottish Enterprise, £12.2m in European funding and £three.5m direct from the Scottish Authorities.
But, two years in the past the Scottish Authorities mentioned that the “first tranche of funding” would “present an estimated £200 million for companies who’re sometimes searching for fairness funding of £2 million upwards.”
Immediately Scottish Labour’s financial system committee member Jackie Baillie mentioned: “That is yet one more SNP scheme that has confirmed to be an train in authorities spin reasonably than substance.
“Scotland’s financial system is stuttering on the sting of recession however the SNP proceed to mismanage funding.
“The First Minister introduced a £500 million fund to assist companies to organize for Brexit. It’s time for the Finance Secretary to clarify why he’s sitting on £350million whereas companies wrestle to remain afloat and Brexit is simply not far away.”
The expansion scheme was supposed as a three-year plan to supply help to small and medium-sized new companies, with the Scottish Authorities confirming at its launch that it could “present as much as £500 million over three years of funding ensures, and a few loans, as much as a most of £5 million per eligible enterprise”.
Mr Mackay’s letter says that the SGS has supplied funding to a variety of small and medium enterprise from household pizza corporations to fish farms and even banks.
Scottish Liberal Democrat financial system and truthful work spokesperson Katy Gordon mentioned: “The SNP’s flagship financial programme has solely paid out a fraction of what was promised.
“At a time when the financial system is patchy and the outlook is bleak, the Scottish Authorities is failing to ship on the guarantees made to companies.”
A spokesperson for Derek Mackay mentioned that the Development Scheme had “leveraged in over £100 million of personal cash.”
He added: “The fact is that we’re investing file ranges within the financial system and are establishing the Scottish Nationwide Funding Financial institution, which can present a long-term enhance to the Scottish financial system.
“On the identical time the Tories are threatening to plunge our financial system into recession by refusing to rule out a disastrous no-deal Brexit.”
Stuart Mackinnon, exterior affairs supervisor for the Federation of Small Enterprise in Scotland, mentioned: “Our analysis reveals that Scottish enterprise optimism is low in the mean time, and that many funding and development selections have been placed on maintain as a result of present political and financial context.
“It’s maybe comprehensible due to this fact that this cash hasn’t been instantly exhausted, particularly when most of the funds it helps are designed to encourage development.
“However, policymakers must ensure that this isn’t an issue with the design of the schemes in query.”