Millions lost as councils sell land despite slump
By Tom Gordon, Scottish Political Editor

TAXPAYERS are losing out on millions of pounds because public bodies are carrying out "irresponsible" land sales while prices tumble during the recession.

Last week, John Swinney, the finance secretary, said he was putting an extra £50 million into the NHS budget so health boards didn't have to rely on sales to pay for new buildings.

"It would be irresponsible to dispose of public land in this particular climate," he said.

However, Swinney's warning is being undermined by councils and quangos continuing to sell land during the slump. Opposition MSPs say the bodies have no choice but to sell in order to meet 2% efficiency targets laid down by by ministers.

The Scottish government's own property website currently lists more than 200 plots for sale. Public land is on sale from the Borders to Shetland, with major sites including just under 11 hectares on sale in Dalkeith for £12m.

In addition to real estate, the government website is also touting more than 80 unwanted buildings, including offices, shops, warehouses, nursing homes and schools.

Swinney's extra £50m for the NHS will help build dental centres in Cumnock, Ayr, Fraserburgh, Campbeltown and Inverness, primary care centres in Ardrossan and Dumfries, and a new health centre in Aberdeen.

The projects had been scheduled for 2009-2010, but faced delays because they depended on receipts from asset sales.

Explaining why he was shifting the money around, Swinney told a briefing: "Quite clearly, the market for disposal of land just now - it would be irresponsible to dispose of public land in this particular climate. Obviously we still retain the assets of land and infrastructure that we can utilise at a later stage when the market improves and we can secure proper value for the disposal."

Labour and the Liberal Democrats said the confusion was caused by the government demanding savings, forcing the sell-off of assets.

David Whitton, Labour's spokesman on finance and sustainable growth, said: "It doesn't exactly smack of joined-up government. Councils are being forced to make big savings. But if central government don't think they're going to get a good price, how on earth do they expect local government to get one?"

Sarah Speirs, of the Royal Institution of Chartered Surveyors in Scotland, said land prices were being dragged down by the wider economic collapse.

"The collapse in oil and commodity markets alongside the wider downturn in the economy should weigh on land prices over the next year," she said.

A government spokesman said public bodies had to dispose of surplus assets at the best possible price.

"There may be particular factors that make it possible to sell a piece or land or property despite the downturn, and so bodies are continuing to try."