The financial performance of Scottish Futures Trust (SFT) 'hub' schemes : the case for better monitoring and rethinking their rationale

Cuthbert, J.R. (2019) The financial performance of Scottish Futures Trust (SFT) 'hub' schemes : the case for better monitoring and rethinking their rationale. Fraser of Allander Economic Commentary, 43 (1). ISSN 2046-5378

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Abstract

This paper is based on the analysis of the financial projections for three of the Scottish Futures Trust hub schemes. The paper develops a range of financial indicators, designed in particular to throw light on the following questions. Namely, what is the opportunity cost to the public sector of the hub approach: and what are the potential profits to private sector investors in the risk capital of hub projects. The paper concludes that the existing availability of information to the public and Scottish Parliament on hub schemes is inadequate, and that a standard set of indicators should be specified, and produced as a required by-product of the financial models for all hub projects. More broadly, the evidence suggests that there should now be a wider consideration as to whether the advantages of the hub approach justify the costs to the public sector, and the potentially large profits for private sector investors.

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