Scotland plans to issue 1.5bn of its own bonds kilts' rather than gilts

"Moody's said its rating was supported by the well-established devolution framework that Scotland operated under, with a requirement to maintain a balanced budget and predictable grant allocation. The ratings agency added that the Scottish National party (SNP) government had demonstrated prudent fiscal management. Swinney said: The Scottish government's high credit ratings are testament to Scotland's strong institutions, track record of responsible fiscal management and pro-business environment. He said the proceeds would be used to fund, capital investment in key infrastructure."

"The jokey name for the new financial instruments is a play on gilts, as UK government bonds are known. If re-elected in May, the SNP government intends to issue a total of 1.5bn of debt during the next parliament. That figure pales into insignificance next to the more than 300bn the UK expects to issue this year, but is seen as establishing the principle that Scotland can raise its own funds independently."

Scotland received credit ratings of Aa3 from Moody's and AA from S&P Global, matching the UK's ratings. Moody's cited the established devolution framework, balanced budget requirement, and predictable grant allocation as supporting factors, and noted prudent fiscal management by the Scottish National party government. Edinburgh plans to issue its own bonds, nicknamed 'kilts', with proceeds earmarked for capital investment in key infrastructure. The government frames the move as using borrowing powers to 'borrow better not more' and points to over 25 years of devolution as evidence of mature public finances. Borrowing rights date from 2015 and remain subject to strict limits; the SNP plans to issue £1.5bn if re-elected.

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