Scottish Greens co-leader Ross Greer has called on the First Minister to abandon his plan to issue Government bonds, arguing that they risk being a ‘gimmick’ which costs more in the long term.
He said the new bonds, nicknamed “kilts”, also create a barrier to Scottish independence.
The Scottish Government last week named nine banks supporting the inaugural £1.5 billion bond, with the first issuance expected in late 2026 or early 2027.
Mr Greer said that raising money through bonds would be more expensive than regular government borrowing from the National Loans Fund, which offers low-cost loans to public bodies.
Fund managers have also held long-standing concerns that should Scotland become independent the yield would be pushed up by credit rating agencies because of the increased risk,
The UK Government sets strict limits on the overall amount of money the Scottish Government can borrow, regardless of whether it is through the National Loans Fund, bonds or by other means.
Mr Greer says that this would mean that the bonds will not increase the funding available to the Scottish Government.
“Scotland needs investment in homes, bus and rail services, schools and hospitals,” he said. “Governments borrowing to build this kind of infrastructure makes total economic sense, but these bonds are not the way to do that.
“The Scottish Government can borrow through existing routes which are cheaper and lower risk. Why would the SNP choose to issue expensive bonds instead, especially when they put another barrier in the way of Scottish independence?
“The Scottish Government should drop its bonds plan and use its regular borrowing powers to deliver the homes, rail lines and public services so urgently required.”
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