Economists have warned the Scottish Government will need to cancel or delay major capital projects as it prepares to publish its draft Budget amid a £1billion funding gap.
The Fraser of Allander Institute said capital spending would have to be prioritised, with deputy director João Sousa warning: “There is no such news on capital, and something will have to give.”
Projects potentially under threat include road dualling schemes on the A9 and A96, alongside hospitals, prisons and rail infrastructure.
Finance Secretary Shona Robison is expected to set out which schemes will be cancelled or delayed when the Budget and Infrastructure Delivery Pipeline are published next week.
Meanwhile, private briefings have revealed SNP transport ministers were warned there was “no funding” available to deliver A96 dualling between Inverness and Nairn before 2031.
Documents obtained by The Press and Journal show officials advised that funding the project would be “equally challenging” beyond the current parliamentary term, despite government support for the scheme and land having been acquired by Transport Scotland.
Inverness and Nairn MSP Fergus Ewing, who secured the papers via FOI, said: “These documents show that ministers knew there was no cash for the Nairn bypass but refused to tell the public the truth.”
A Scottish Government spokesperson said: “The Infrastructure Delivery Pipeline, which will be published alongside the draft Budget on 13 January, will set out an affordable, deliverable portfolio of infrastructure investments over the next four years.”
On the A96, the government added: “The position of the Scottish Government has not changed – the current favoured position is to fully dual the A96.”