Investment Zone - Update Report - Leadership17 09 25 -FINAL
Renfrewshire Council · 17 September 2025
Back to Leadership Board — 17 September 2025 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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_____________________________________________________________________ To: Leadership Board On: 17 September 2025 _____________________________________________________________________ Report by: Chief Executive _____________________________________________________________________ Heading: Investment Zone - Update Report ____________________________________________________________________ 1 Summary 1.1 The purpose of this report is to inform Board on the progress of the Glasgow City Region Investment Zone (GCR IZ) and Renfrewshire’s participation in it. It seeks approval of the proposed tax site boundary within Renfrewshire, including an overview of the associated fiscal incentives, along with approval of the proposed non-domestic rates retention (NDRR) site, allowing rates collected within Renfrewshire to be reinvested in Renfrewshire and across the wider IZ area. _____________________________________________________________________ 2 Recommendations 2.1 It is recommended that the Board: (i) Notes the timescales for the development of the GCR Investment Zone proposal and for its submission to UK and Scottish Governments; (ii) Approves the proposed boundary of the GCR IZ Tax Site located in Renfrewshire, subject to final confirmation from the UK and Scottish Governments; (iii) Approves the designation of the same land area as a Non-Domestic Rates Retention (NDRR) site, subject to final confirmation from the UK and Scottish Governments; (iv) Notes that Renfrewshire Council will continue to be responsible for the collection of non-domestic (business) rates within the NDRR site boundary;
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(v) Agrees that a legal agreement should be prepared, for Board approval, between Renfrewshire Council and the GCR member authorities detailing the arrangements for non-domestic rates collection and reinvestment within the NDRR site boundary; (vi) Agrees to any non-domestic rates growth retained as a result of the NDRR site being pooled at a GCR level and re-invested into the IZ programme in line with its overall objectives and note that similar arrangements are to be put in place for the two other proposed NDRR sites located across areas within Glasgow City Council, South Lanarkshire Council and North Lanarkshire Council. _____________________________________________________________________ 3 Background 3.1. In June 2023, the UK and Scottish Governments jointly announced the designation of Glasgow City Region (GCR) as one of Scotland’s first two Investment Zones (IZs), alongside the North-East of Scotland. The GCR IZ is backed by a £160 million funding envelope over 10 years, comprising both capital and revenue funding, and includes optional fiscal incentives such as tax reliefs and the potential for non-domestic rates retention (NDRR). 3.2. The GCR IZ aims to accelerate economic growth, attract inward investment, and create high-value jobs by focusing on strategic employment sectors where the region has existing strengths and growth potential. 3.3. A report to the Economy and Regeneration Board on the 21st of January 2025 sets out in detail the expression of interest and call for sites phases of the IZ programme development (see background papers). 3.4. In summary the GCR IZ bidding process consisted of: Phase 1: Expression of Interest (Sep–Nov 2023) • Over 90 EOIs received from public/private/academic sectors. Phase 2: Open Call (Jan–Jun 2024) • 41 bids submitted totalling £1.88bn, with £640m requested from IZ and £1.24bn match/private investment. • Evaluation included quantitative scoring, sectoral feedback, and strategic assessment. Phase 3: Assessment Outcome (Aug–Dec 2024) • Focus area: advanced manufacturing & precision engineering. • Six priority projects and tax site location short listed (further detail below). 3.5. Under the overarching goal of driving growth in advanced manufacturing and precision engineering, the IZ programme will focus on strategic investments in critical technologies. It will leverage existing regional strengths in semiconductors, space, life sciences, and maritime to build a world-class innovation ecosystem.
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3.6. To support these ambitions, six projects across the city-region have been shortlisted for capital investment. Two space-related projects include Project PRISM, led by the University of Strathclyde, which aims to advance innovation and manufacturing in small satellite technology—reinforcing GCR’s role in the UK space sector. Also Skyrora’s Spacecraft Manufacturing and Testing Centre will focus on advanced and additive manufacturing, equipment rental, and industry applications to strengthen space and aerospace capabilities. 3.7. In the semiconductor sub-sector, three projects have been shortlisted. The University of Glasgow’s Laser Supply Chain and Advanced Packaging project will establish a centre for prototyping and commercialising semiconductor lasers. The National Centre for Advanced Semiconductor Packaging (NCASP), led by the University of Strathclyde, will scale up manufacturing of advanced semiconductor devices and foster local supply chains. Neuranics’ project will develop magnetic sensing semiconductor technologies to support cluster growth. 3.8. Additionally, one maritime project—the Maritime Supply Chain Innovation Centre by Malin—will support decarbonisation among maritime SMEs through shared facilities and resources, enhancing supply chain resilience and economic impact. 3.9. In addition to these six projects, one proposed tax site is planned, located in Renfrewshire (further details below). The tax site aims to drive growth by leveraging key assets such as AMIDS, NMIS, MMIC, and Glasgow Airport. With a focus on strategic land development, the site will be developed in partnership with the two principal landowners - Renfrewshire Council and Glasgow Airport. 3.10. Through the IZ, there is also an opportunity to designate a NDRR site within Renfrewshire (further details below), using essentially the same boundary as the tax site, as well as two other locations across the GCR. This designation allows any additional non-domestic rates received from new development to be pooled and used exclusively to support further development of the key IZ sectoral cluster (advanced manufacturing and precision engineering). Given the strengths offered by AMIDS and other key locations in this sector, Renfrewshire is expected to be well positioned to attract a significant proportion of these re- invested resources. 3.11. The IZ Programme is structured around a series of Gateway submissions to both the UK and Scottish Governments. Gateways 1 and 2 have already been approved. Gateway 3 and 4 submissions, currently in development, will provide detailed proposals covering governance arrangements, planned interventions, and site designations. _____________________________________________________________________ 4 Tax Site Proposal 4.1. The proposed tax site in Renfrewshire spans 140.5 hectares and includes four parcels of land [see Figure 1 below]: 1. AMIDS (Netherton Campus), 2. Abbotsinch,
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3. Airside North, and 4. Campsie Drive These sites are strategically located near Glasgow Airport and include existing innovation assets such as the National Manufacturing Institute Scotland (NMIS) and the Medicines Manufacturing Innovation Centre (MMIC). Figure 1: Proposed tax site map 4.2. The sites need to meet the Government’s 'underdeveloped' criteria, which includes brownfield land, under-utilised land with some construction, and vacant premises. As a result, existing occupied buildings within the site areas will be excluded. The designation is intended to stimulate new economic activity and development. 4.3. Businesses operating within the designated tax site will be eligible for a suite of fiscal incentives for up to 10 years from the point of designation. Two of these taxes are devolved to the Scottish Government; • Land and Buildings Transaction Tax (LBTT) relief: Full relief for land and buildings bought for commercial use or development. • Non-Domestic Rates relief: 100% relief for up to 5 years on newly occupied business premises and certain expanding businesses. 4.4. Three others are reserved by the UK Government • Enhanced Capital Allowance: 100% first-year allowance for qualifying expenditure on plant and machinery. • Enhanced Structures and Buildings Allowance: Accelerated relief of 10% per year over 10 years for qualifying non-residential investment.
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• Employer National Insurance Contributions relief: Zero-rate Employer NICs for new employees working at least 60% of their time in the Tax Site, on earnings up to £25,000, for up to 36 months. 4.5. The tax site proposal has been developed in partnership with Renfrewshire Council and Glasgow Airport, the principal landowners. The site boundaries have been refined following feedback from government, with (for example) Westway removed due to eligibility concerns. A governance agreement will be required between the Council and the Airport in terms of how the tax incentives will be administered. This agreement will be presented to a future Council board. 4.6. Approximately £25 million is allocated for tax incentives from the overall IZ programme [part of the overall £160m funding envelope]. The tax site is forecast to deliver significant economic benefits, including: • £539 million in private sector investment; • 166,000 square metres of new employment space; • 2,300 high-value jobs; 4.7. The designation of the tax site is aligned with the GCR IZ’s strategic focus on advanced manufacturing and precision engineering. The site is expected to attract inward investment, support innovation, and create a hub for high-value employment in Renfrewshire. 4.8. The final designation of the tax site is subject to approval by both the UK and Scottish Governments as part of the Gateway 4 submission process. The Council has sought assurances from both governments regarding responsibility for covering any tax incentives claimed beyond the £25 million indicative allocation in the overall IZ budget, ensuring that no financial risk lies with the Council. 4.9. Responsibility for two of the tax incentives—Land and Buildings Transaction Tax (LBTT) and Non-Domestic Rates Relief (NDR)—is devolved to the Scottish Government. Confirmation has been received that LBTT funding will not be capped, with any additional claims received to be covered by the Scottish Government. 4.10. As the business rates collection authority, the Council will have the ability to cap NDR relief and will be required to develop a local policy for IZ-related NDR which reflects this cap. This would limit any financial exposure the Council might face should the fund be oversubscribed by companies applying for business rates relief. 4.11. The remaining tax incentives available to investing companies fall under the responsibility of the UK Government. A signed memorandum of understanding with HM Treasury confirms that, should the actual cost of reserved tax reliefs exceed estimates, the UK Government will cover those costs outside of the IZ funding envelope. 4.12. The estimated cost of each of the tax incentives will continue to be reviewed as part of the assessment of the final Gateway 4 proposals, but the total estimated cost will not exceed £25m.
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_____________________________________________________________________ 5 NDR Retention Site Proposal 5.1. The GCR IZ proposal includes the designation of a NDRR site within Renfrewshire, aligned with the proposed tax site boundary (Figure 1 above). 5.2. Governance arrangements for NDRR sites require close collaboration between the IZ Accountable Body (which is the GCR) and the lead local authority (Renfrewshire Council), as the business rates authority. Renfrewshire Council, as the billing authority, is required to consent to the designation and collection of rates within the proposed NDRR site. Without formal consent from the local authority, the NDRR site(s) cannot proceed to Gateway 4. 5.3. Renfrewshire Council is one of 4 local authorities in GCR (3 sites) identified as a potential location for a NDRR site. Sites are also being proposed within the boundaries of Glasgow City, North Lanarkshire, and South Lanarkshire Councils. Each of these proposals will be subject to approval by their respective Council boards before proceeding. 5.4. The IZ Accountable Body will be responsible for ensuring that any growth in non-domestic rates above an agreed baseline is collectively pooled from the 4 Councils and used exclusively to support the growth of the sectoral cluster identified in the Investment Zone. This will be guided by a clear reinvestment strategy, which must be transparent and enable the Accountable Body to remain accountable to the Governments for delivery. 5.5. Renfrewshire Council will be responsible for establishing the NDR baseline, collecting business rates, and submitting annual returns to the Scottish Government. These returns will include data on baseline income, additional IZ NDR income, and total NDR income. The Council must also demonstrate that new developments (contributing to the retained business rates) meet the 'but- for' test, confirming that investment would not occur without the IZ designation and that the project aligns with programme objectives. 5.6. Administrative costs incurred by Renfrewshire Council in managing the NDRR programme can be reimbursed from retained NDR funds, subject to agreement with the Accountable Body. This ensures that the rating authority is adequately resourced to fulfil its obligations. 5.7. The reinvestment strategy will be developed jointly by GCR, the city region member authorities and other partners, such as Scottish Enterprise and Skills Development Scotland (SDS), and approval being given from the City Region Cabinet. 5.8. Decisions will be made through a robust governance structure that ensures public-private oversight and democratic accountability. The strategy will prioritise infrastructure, skills, innovation, and support for the advanced manufacturing and precision engineering sectors across the GCR.
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5.9. Officers have already compiled a list of potential AMIDS investment related proposals which the retained rates could be used to fund and which, otherwise, would require to be funded by the Council. These include future site preparation works; new roads, paths, paving and surfaces; soft landscaping; public transport provision and extension of the existing AMIDS district heating network. 5.10. Subject to approval from Board, officers will continue to engage with GCR and government partners to finalise the NDRR proposal and reinvestment strategy for submission at Gateway 4. _____________________________________________________________________ 6 Next Steps 6.1. Subject to this Board’s approval of both the tax and NDRR sites in Renfrewshire, these will be incorporated into the Gateway 3 and 4 submissions. The GCR plans to submit these gateways for final approval on 30th September 2025. 6.2. Officers will continue to provide updates and submit any required requests for approvals to future Boards. Overall, it is hoped that the IZ will act as a catalyst for growth, stimulating economic activity, job creation and reinvestment in Renfrewshire. ___________________________________________________________ Implications of the Report 1. Financial – Significant as the Council will potentially have access to retained business rates income which can be reinvested in Renfrewshire to meet the aims of our Economic Strategy. There will also be revenue costs associated with the administration and monitoring of the tax site and NDRR site. These costs are expected to be covered from either the IZ programme allocation or through retained non-domestic business rates. 2. HR & Organisational Development – None at present 3. Community/Council Planning – • Our Renfrewshire is thriving / Reshaping our place, our economy and our future – The project supports significant investment in Renfrewshire, which will support job creation, business development and GVA and overall economic growth. 4. Legal – None at present, although secondary legislation will follow with the formal designation of the IZ and the tax and NDRR sites 5. Property/Assets – None other than those already raised in relation to the AMIDS development strategy 6. Information Technology – None
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7. Equality & Human Rights - The Recommendations contained within this report have been assessed in relation to their impact on equalities and human rights. No negative impacts on equality groups or potential for infringement of individuals’ human rights have been identified arising from the recommendations contained in the report. If required following implementation, the actual impact of the recommendations and the mitigating actions will be reviewed and monitored, and the results of the assessment will be published on the Council’s website. 8. Health & Safety – None 9. Procurement – None 10. Risk – If the NDR relief allowance of £9.8m was exceeded. 11. Privacy Impact – None 12. Climate Risk – None 13. Children’s Rights – None 14. Cosla Policy Position – None _____________________________________________________________________ List of Background Papers (a) Update on Glasgow City Region Investment Zone. Economy and Regeneration Board, 21 January 2025 _____________________________________________________________________ Author: Euan Shearer; Regeneration and Place Manager Email: euan.shearer@renfrewshire.gov.uk