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UK and Scottish governments expected to unveil a growth deal worth around £300 million over ten years

The UK and Scottish governments are today expected to unveil a unique deal, worth £350 million over ten years Photo: ITV Border

By Peter MacMahon, ITV Border Political Editor

The UK and Scottish governments are today expected to unveil a unique deal, worth £350 million over ten years, to stimulate economic growth north and south of the Border.

Under a cross-border version of the 'city deals' projects ministers in Westminster and Holyrood are contributing cash to stimulate the economies in five council areas in southern Scotland and north-west England.

Today the Scottish government announced it would be putting £85 million into the Borderlands deal.

The UK Chancellor Philip Hammond is expected to provide £260 million for the deal in his Spring statement to MPs today.

The idea of a Borderlands growth deal was first promised in the Conservative party's 2017 UK general election manifesto and has been championed by Scottish Secretary and Dumfriesshire, Clydesdale and Tweeddale MP, David Mundell.

However, Scottish ministers have also been keen to support economic development and have put money alongside the UK government into 'city deals' for areas including Glasgow and Perthshire.

Talks between the Scottish, UK governments and the five councils - Dumfries and Galloway, Scottish Borders, Carlisle City, Cumbria County, and Northumberland County - have been taking place to hammer out the details.

The final proposals are likely soon but investment in cross-border infrastructure - including roads improvement, faster broadband, tourism and skills development - are among the most likely uses for the money. Today, ahead of the Chancellor's statement, the Scottish government put a figure on its contribution - promising £85m over ten years.

Scottish government infrastructure secretary Michael Matheson said:

Alongside the establishment of a new enterprise agency for the south of Scotland, and the activity being taken forward by the South of Scotland economic partnership, this investment will help to drive inclusive growth that delivers significant and lasting economic benefits for individuals, businesses and communities right across the region."

– Michael Matheson
Talks between the Scottish, UK governments and the five councils - Dumfries and Galloway, Scottish Borders, Carlisle City, Cumbria County, and Northumberland County - have been taking place to hammer out the details. Credit: ITV Border

Mr Matheson called on the UK Government "to match our financial commitment, over the same timescale of ten years, to deliver a package of transformational investment that will harness the region’s full economic potential.”

Ahead of the Chancellor's statement, the UK government would not publicly give a figure for the investment it will put in, but I understand that their contribution will take the total investment to more than £350m, £260 million coming from the Treasury.

There was some tension over the deal with the suspicion in Westminster that the Scottish government was trying to take credit for the announcement by making their promise ahead of the Chancellor's statement later today.

Scottish ministers also believe that UK ministers try to steal a march on them with 'city deal' announcements.

A UK Government spokesperson said:

The Borderlands growth deal will bring transformative change to the region and we expect to announce further progress very soon.

The UK Government’s commitment will be based on our assessment of the projects that have come forward not on arbitrary challenges.

It is essential for the future of the Growth Deals programme – which has already seen the UK Government commit more than £1.3 billion across Scotland – that partners continue to work collaboratively.”

– UK Government spokesperson

The Chancellor is also expected to stress the UK government's commitment to the north-west of England by confirming that more than £100 million will be spent on the southern approach roads to Carlisle.

Sources say this will be a further boost to the economy in Cumbria and also have knock on beneficial effects on the whole of the Borderlands region.