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City looks to new capital source

Aberdeen Council looks to markets for funds

Aberdeen Exhibition CentreAberdeen City Council may become the first local authority to raise funds on the capital markets.

It is looking to access finance via a bond issue which could be use to support major projects such as the new Aberdeen Conference Centre (pictured).

The initiative would trigger plans first considered by the council in 2012 to encourage investment by private companies in funding key developments.

At that time there was talk of raising £250m from a bond issue, which would leverage a similar amount from other sources.

Yesterday council leader Jennifer Laing said: “The prospect of a bond issue has the potential to be one of the most significant events in the history of our city.

“Following on from the assignment of the credit rating, it would be another first for a Scottish local authority and we are proud to be leading the way with innovation in public sector finance.

She added: “By being proactive in our approach to capital funding, we are clearly being mindful of our duty to protect the revenue budget which is the bedrock of our service delivery.”

The plan has the backing of the Scottish government. It believes other local authorities could go down a similar route.

Finance Secretary Derek Mackay said: “We welcome Aberdeen City Council’s innovation in using the capital markets as a route to finance.”

 



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