A £150 million plan to revitalise the centre of Aberdeen and its beachfront will add to the city’s borrowing burden, it has been confirmed.
Officials are drawing up a refresh of the city centre masterplan, which could include a new stadium – partly paid for by the taxpayer – for Aberdeen FC, investment in the Beach Ballroom and replacement for the Beach Leisure Centre.
The long-term blueprint for future council spending is also expected to include improvements to walking and cycling links between the city centre and the seafront.
Council chiefs have revealed they will look to commit £150m to the project ahead of the authority’s budget meeting tomorrow.
But details about what else the massive spend might achieve remain sparse and are not expected to become any clearer until May.
Council co-leader Douglas Lumsden said: “This injection of £150m will help to ensure Aberdeen remains a vibrant, creative and ambitious city.
“The UK government has introduced two major schemes that should certainly help Aberdeen City Council pay for infrastructure within the masterplan, the UK Shared Prosperity Fund and the Levelling Up Fund.
“This £150m will be profiled into the capital plan, probably over the next seven years, from a mix of capital grant funding and borrowing.
“We would not be borrowing more money if council officers were not saying we are in a good position to do it, through sound financial management over the last 10 years.”
The city’s gross borrowing will near £1.3 billion by next March, and by 2026 is expected to top £1.75bn.
Opposition Liberal Democrat group leader Ian Yuill told The P&J he would be “concerned” to see further borrowing when the council is “already significantly in debt due to investment in big projects over the past few years”.
“I would not be immediately enthusiastic about investing significant public funds in a football stadium, though there may be a place for partnership,” he added.
SNP group leader, Alex Nicoll, said: “The ruling administration needs to clarify how exactly they plan to spend this £150m of borrowed money – including how much they plan to spend on a football stadium.
“Back in 2017, the SNP proposed a beach masterplan be brought forward and this was voted down by the ruling administration.
“Whilst imitation is the greatest form of flattery, no report or plans have been published and we certainly haven’t seen any consultation with the public to date so we really need to know what they are planning to spend the money on.”
Aberdeen FC fought hard for planning permission for its joint training ground and stadium at Kingsford, on the city’s outskirts.
While players have trained at Cormack Park since 2019, the future of the £50m, 20,000-seat stadium was thrown into doubt by the financial toll of Covid.
Council sources have since revealed they would be willing to bear some of the cost of a replacement on the site of the former Hilton Double Tree hotel to entice the club to remain near the city centre.
Club commercial director, Rob Wicks, said: “This is good news for the city centre and surrounding area as businesses and organisations, like ourselves, seek to recover from the impact of the pandemic.
“The club has been heartened by the council’s recognition of our major role within the community and our contribution to the local economy.
“We are keen to see how the club, along with Sport Aberdeen and other stakeholders, could play our part in these plans for the regeneration of the beachfront.
“It’s obviously early days but we are certainly open to exploring this further.”
Council leadership accused of being ‘out of the loop’ on UK funding it hopes will pay for £150m masterplan
Questions remained over the source of the funding to be spent on the second phase of the Aberdeen city centre masterplan as the government initiatives identified are not thought to be offering anything like £150m needed.
The new UK funds have been setup in the wake of Brexit and will allow council bosses to speak directly with London on funding – sidestepping the usual route for finance talks in Scotland at Holyrood.
A first tranche of Levelling Up funding was announced last week, with Aberdeen 124th in the queue – in pot two – and still awaiting news on what it might receive.
Meanwhile, the UK Shared Prosperity fund is expected to be worth around £100m to the whole of Scotland, £50m less than the proposed money being put aside for the Granite City’s latest revamp.
Council co-leader Douglas Lumsden mentioned both as ways of funding the proposed change to the city centre and beach.
But Aberdeen Central SNP MSP, Kevin Stewart said: “It’s clear for all to see that the UK Government doesn’t consider Aberdeen to be a priority for these funds and, even if they did, the reality is that it would only provide a tiny fraction of the money needed.
“Douglas Lumsden is keen to promote funds that bypass the Scottish Parliament and undermine devolution – but seems totally out of the loop given the Tories dumped Aberdeen behind 123 other councils in the race to access cash.
“If the council is about to splash another £150m of tax payers’ money then they need to be honest about where it is coming from because, at present, not a single penny is confirmed as coming from Westminster.”