Rising construction costs are a major concern for the Tay Cities Deal Joint Committee, as it tries to progress projects creating thousands of jobs.
The Deal – signed more than two years ago – has the ambition of creating 6,000 quality jobs.
A total of 26 projects were backed by the deal across Dundee, Perth, Angus and Fife.
The UK and Scottish governments together pledged £300 million. This unlocked a further £400m from business, public sector and educational organisations.
Tay Cities Deal costs warning
However, rising costs are impacting some of the Tay Cities Deal according to Councillor Grant Laing, chair of the Tay Cities Region Joint Committee.
Recently The Courier revealed James Hutton Institute is facing a funding shortfall of more than £10m on its International Barley Hub, which is currently under construction.
The Invergowrie-based institute received £62m from the Tay Cities Deal.
While construction of some buildings is complete and work on the key £44m scientific block has begun, construction prices have risen by 25% since funds were approved.
The costs of archaeology works and a new road junction were much higher than originally estimated.
Mr Laing admits soaring construction costs are a “challenge”.
He said: “As we look ahead to the coming year we know that the impact of the increasing costs of services and materials will present the Deal with our biggest challenge to date.
“The Joint Committee closely monitors the effect that this may have on the rate and scale of progress.
“We will continue to emphasise the importance of collaborative working and the benefits of learning from each other to manage these issues at a time when investment in the Tay Cities Region is most needed.”
Tay Cities Deal projects
Despite this, Mr Laing said he is pleased at progress that has been made on the Tay Cities Deal so far.
During 2021-22 several major projects were completed and others moved into the delivery stage.
These included:
- International Barley Hub and Advanced Plant Growth Centre at the James Hutton Institute
- Scotland’s first drone port, in Montrose
- The new Eden campus of the University of St Andrews
- Abertay cyberQuarter
- Tay Cities Engineering Partnership
- Discovery Point upgrade
The University of Dundee has previously announced a new innovation hub, which accessed £25m of Deal funding.
Meanwhile the Perth Cultural Transformation (Perth & Kinross) project is redeveloping Perth City Hall.
Mr Laing adds: “The Tay Cities Region Deal continues to demonstrate what we can achieve when we work together towards our shared vision to empower and promote inclusion through the region’s people, places, businesses and communities.
“The progress we have made in 2022/23 is a testament to the commitment of all partners working in challenging circumstances.”
Conversation