The business case will be used to access £15m of funding earmarked for the project by the Scottish Government as part of the Edinburgh and south east Scotland city region deal.
That deal, agreed in August 2018, is a £1.3bn investment programme drawn up by the UK Government, Scottish Government, the local authorities of Edinburgh, East Lothian, Fife, Midlothian, Scottish Borders, West Lothian and the region’s universities and colleges. There are also regional partners from the private and third sectors.
The UK and Scottish governments will invest £300m each over the next 15 years, with other partners committing to an additional £700m.
The full business case report highlights the need for change in the Scottish Borders, saying: “The current, depressed state of the office and industrial property market in the Scottish Borders requires the level of public sector investment planned under this programme.
“As with many other rural economies, the Scottish Borders has to overcome the problem of market failure caused by a combination of remote locations and poor infrastructure, a lack of supply of modern business premises and the increasing obsolescence of existing stock.
“Public-sector intervention is needed to address this issue, which is crucial to ensuring that sustainable, inclusive economic growth can take place.
“The coming of the Borders Railway has presented a once-in-a-generation opportunity to enable the local economy to grow.
“A Central Borders Innovation Park, situated next to the Borders Railway terminus at Tweedbank, would meet the urgent need for high-quality business space in the central Scottish Borders.”
Scottish Borders Council will need to forward-fund the projected costs as funding from the deal will be spread over a 15-year period, meaning that the council will have to foot the bill for interest repayments.
The council’s chief economic development office,r Bryan McGrath, told a full meeting of the council today, January 31: “Over the project life, the average cost of the projected borrowing is £142,000 per annum. However, during 2026-27 this will peak at £224,000.
“This is based on interest-only costs. The city region deal growth fund grant will be treated as a capital debtor and be used to repay principal borrowing.”
Mid Berwickshire councillor Mark Rowley, the council’s executive member for business and economic development, said: “It comes as no surprise that I commend this report.
“This is a perfect example of a very strong case being presented over time, to us, and the Scottish and UK governments combining.
“This is the final part of dealing with the sums of the project that will allow the government to consent to that drawdown of funds.
“The plans are in place, we’ve approved the scheme which is going to be developed, we’ve given it legs with the decision on Lowood, and so I think this is a very well-thought-out case.
“There will potentially be some criticism in the room that this has again happened in the central Borders but the central Borders is the central Borders for a reason.
“That particular site is at the current end of the Borders Railway. The stronger we make the economic case for the current end of the Borders Railway the stronger the case gets for extending the railway through to Hawick and onto Carlisle.
“That’s not just a slogan, it’s true. People say that this is more money going into the central Borders, and yes it is, but because of where the money is coming from in the city deal, this is the only place it can go.”
Leaderdale and Melrose councillor Kevin Drum also supported the business case, saying: “I welcome the high-quality employment opportunities this will bring and the associated skills and experience which will form an integral part of this programme.
“We’ve been discussing this programme for quite a while now, so it’s nice to actually drive through Tweedbank and now see some work happening on the ground.”
However, Hawick and Hermitage councillor Davie Paterson said he feels the Central Borders Innovation Park is another example of favouritism, saying: “This development will suck the life out of many communities in the Scottish Borders, and some are already struggling at the moment.
“If you look at the report, it says this will benefit the economy of the Scottish Borders. Surely that should be corrected to just the central Borders because where I live and where I represent haven’t seen any economic redevelopment.
“That has to be extended to all areas of the Scottish Borders, so we can develop the economic benefits to everywhere like I’m sure the central Borders will be getting.
“Some people are now wondering if there is any real commitment given to extending the Borders Railway. I really hope that’s just people getting worried about nothing.”