Bonds announcement a 'proud day for Scotland', says Swinney

The announcement of plans to issue Scottish government bonds is a "very proud day for Scotland", First Minister John Swinney has said.

The SNP leader confirmed bonds should be issued in 2026-27 in a bid to attract investment for "key infrastructure" projects - though this is subject to the outcome of May's Scottish parliament election as well as other factors.

It comes after two global credit rating agencies awarded Scotland the same ranking as the UK.

Moody's rated the Scottish government as Aa3, while S&P Global rated it as AA, both identical to the UK's sovereign rating and higher than countries such as Spain, Italy and Japan.

Mr Swinney said: "This is a very proud day for Scotland, because we've achieved the best possible credit ratings we could within the United Kingdom from two of the world's leading credit rating agencies, Moody's and Standard and Poor's.

"That's a reflection of the economic strength of Scotland, the strength of our financial management, and the strength of the financial institutions within Scotland, and it gives us a really strong foundation for the issuing of a bond up to a value of £1.5bn in the next parliamentary term, over a number of years, which can underpin investment in the capital programme of Scotland."

The bond issuance - which would allow investors to buy Scottish government debt - would provide "another option" for the nation to attract investment, Mr Swinney said.

While he said housing and the drive to net zero could benefit from the bonds, he would not go further on specific programmes which would be financed.

Mr Swinney added: "The government will set out in the investment programme in January exactly the projects that we're taking forward over the course of the next few years.

"But obviously we need to have the funds to underpin that programme and what the announcement overnight from the credit rating agencies demonstrates is that Scotland has every potential to attract investment on international financial markets and that we can use those resources to support our capital programme."

The Moody's report, however, included independence as a possible factor that could see the nation's credit rating downgraded.

The report said: "Although not our baseline scenario, Scottish independence could exert downward pressure on the rating by introducing heightened uncertainty about the institutional framework and potentially raising financial stability risks."

Mr Swinney said "specific issuance plans will be subject to market conditions closer to the time".

He added the Scottish government would "shortly commence engagement with banks to act as joint lead managers to enable the next Scottish government to proceed without delay" on the proposed Scottish bond scheme, which has been nicknamed "kilts" in a play on the UK equivalent of gilts.

Read more from Sky News:
How families can create £16,000 of untaxed income
Economy grew by 0.1% in third quarter, official figures show

In 2023, then first minister Humza Yousaf commissioned initial work with the goal of issuing bonds before the end of the current Scottish parliament session.

That came after advisers in the Scottish government's investor panel recommended making bonds available to the market as a means of raising Scotland's profile and attracting investment.

Angus Macpherson, chairman of financial advisory firm Noble & Co and former co-chair of the investor panel, said he was "greatly encouraged by the progress the Scottish government is making in achieving a credit rating to raise Scotland's profile in the international capital markets".

He added: "This is a positive step forward and demonstrates they are serious about becoming a more investor friendly destination."

(c) Sky News 2025: Bonds announcement a 'proud day for Scotland', says Swinney