Scottish Budget focuses on infrastructure investment to kick-start economic growth

Its draft Budget for 2013-14 will make £180 million available over the next two years for construction, skills and employment and investment in the green economy.

The total includes "immediate stimulus to the construction industry" in the form of £40m investment in affordable housing, and an increase from 55 to 67 in the number of schools which will be built through the Schools for the Future Programme. A further £17m will be made available for the college sector.

Scottish Finance Secretary John Swinney said that the Government had used "every option available" to fund further economic stimulus including budget exchange mechanisms, early repayment of loans and "careful managing" of the budget. It will also reduce the amount made available to publicly-owned utility Scottish Water by £45m.

"In difficult economic times this Government is doing everything within its limited power to stimulate Scotland's economy, to invest in our young people, protect households and support front line services," Swinney said.

The Budget also assigns £2.5m for hybrid buses, £1.5m in additional funding to be used to deliver a "high yield" tourism marketing strategy and an additional £1m for the maintenance of historic buildings. Ahead of the 2014 Commonwealth Games in Glasgow £1m has been set aside to support Scotland's elite athletes, while a further £6m will be used to support cycling and improve routes.

The Scottish Government will also maintain its council tax freeze, police numbers, no tuition fees, free prescriptions and concessionary travel. It has also ring-fenced the healthcare budget from any cuts and has allocated £9.1m services funding for 2013-14. Public sector pay will see a "modest increase" after a two-year pay freeze, with increases capped at 1%; while £15m will be invested to support up to 10,000 young people into employment with small businesses.

Infrastructure law expert Colin Fraser of Pinsent Masons, the law firm behind Out-Law.com, said that the evidence that investment in construction was the best way to lift the overall economy was "consistent and compelling".

"In a Budget that promised to drive Scotland forward, it was vital the Government prioritised spending in construction and infrastructure," he said. "The Budget has also allocated investment in the green economy, with £30 million to be spent on energy efficiency measures as well as the creation of a new fund that is intended to support energy education. Again, this move will hopefully go some way in stimulating growth in what is becoming an increasingly important industry to Scotland's overall economy."

The £30m Green Investment Package will be made available over the next three years, and will prioritise energy efficiency for homeowners, reducing bills and tackling fuel poverty. A new Renewable Energy Investment Fund, to include an Energy Skills Academy which will "support the creation of skills in oil and gas, renewable, thermal generation and carbon capture and storage" also forms part of the package.

The Scottish Government has also committed to reforming empty property relief to provide "strong incentives to bring vacant premises back into use". Among the proposals is introducing an amendment into the Unoccupied Properties Bill to offer a business rates discount to those who bring empty properties back into use.