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Politics / Government to take small populations into account when deciding islands deal settlement

Councils in Shetland, Orkney and the Western Isles have requested a combined £300 million


THE UK Government has confirmed that the Scottish islands’ modest populations will be taken into account when deciding on a potential growth deal for the region which, it has been claimed, could create hundreds of new jobs in Shetland.

Northern Isles MP Alistair Carmichael has welcomed the commitment, saying that a deal based on population numbers – which other packages elsewhere in the UK have done – would not make for a “meaningful” settlement for the Scottish islands.

The islands deal is proposed by the UK and Scottish governments to drive growth and stimulate the economies in Shetland, Orkney and the Western Isles.

Northern Isles MP Alistair Carmichael.

Negotiations on a deal have been ongoing for a number of years with local authorities and other public bodies as the two governments look to extend growth deals already established in certain cities and regions to the Scottish islands.

A report presented to councillors late last year by Shetland Islands Council development director Neil Grant confirmed that the islands’ bid asked for a combined total of £300 million.

It was submitted to the two governments in November.

In comparison, the Inverness and Highland city-region deal, which was struck in 2017, was worth a total of £315 million.

Projects which are being proposed from Shetland for support include the Knab site redevelopment, decommissioning, aquaculture, skills and learning and a scheme to sustain activity in the oil and gas sector.

There is also a hope that the islands deal could help to create around 700 jobs in Shetland over the coming years.

The topic was raised in Westminster on Wednesday as Carmichael sought assurances from the UK Government that the islands’ small populations wouldn’t work against them in negotiations over the final funding settlement.

In Shetland in particular, the size and national importance of industries such as oil and gas, fishing and aquaculture outweighs the 23,000 population.

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“On the subject of the quantum for the islands deal to which the secretary of state [for Scotland, Alister Jack] has already referred, will he confirm that he will pursue with the Treasury a basis that is different from the per capita funding of other deals because otherwise the deal for the Islands will never be a meaningful one?” Carmichael asked.

Jack responded: “The Honourable Gentleman raises a very good point. Previously these deals have been done on the basis of per capita, and we recognise that the islands are a huge geographical area and that funding per capita would bring a very low outcome so we are in discussions with Treasury about raising the quantum.”

Carmichael said an islands deal was “long overdue”.

“I look forward to discussing this further with the government and the islands executives to ensure that we have an islands growth deal that is fit for purpose,” he said.

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