Aberdeen and North East – 2
Investment Zone (SEZ)
The North East Scotland Investment Zone (NESIZ) is one of Scotland’s two Investment Zones, selected jointly by the UK and Scottish Governments in June 2023. Its geographical basis is the Aberdeen City and Aberdeenshire regional economy, and its present sectoral focus is green industries and digital technology, particularly opportunities associated with floating offshore wind, green hydrogen and wider green-energy technologie
The original programme announcement referred to support of up to £80 million over five years. The subsequent Scottish Investment Zone model was expanded to a 10-year programme with an overall £160 million envelope. Importantly, this does not mean £160 million of conventional grant expenditure: the estimated cost of tax incentives chosen by the region is deducted from the £160 million envelope, leaving the balance available for flexible programme expenditure. Non-Domestic Rates Retention sits outside that £160 million envelope.
Aberdeenshire Council is clearly operating as NESIZ Accountable Body.
This has been endorsed by both councils and was expressly linked to Aberdeenshire’s existing administrative experience with the Aberdeen City Region Deal.
Evidence of operational Accountable Body functions now includes:
A Tax Site Operations Team has specifically been established to manage the three NESIZ tax sites.
The Tax Site Management Policy is important here because the sites cross both local-uthority jurisdictions
The national framework establishes:
£160m overall envelope
minus estimated tax-expenditure cost
= flexible programme-spending envelope
If an Investment Zone chooses tax sites, the cost attributed to those tax reliefs is deducted from the £160 million.
NDR retention is separate from the £160 million envelope.
Government guidance also expects significant match/co-investment, with an expectation of at least 60% match against the remaining flexible funding envelope, subject to intervention circumstances.
The three NESIZ tax sites became legally designated on 26 February 2026:
Tax-site uptake.
The appropriate measure is not simply how many firms express interest, but qualifying investment, additionality, employment, occupation and fiscal cost.
The national tax offer may include:
NDR retention is particularly important and should not be confused with NDR relief.
The national Scottish Investment Zone model allows the relevant local authority to retain up to 100% of additional NDR growth above an agreed baseline, adjusted for an agreed displacement factor, for 25 years from site designation.
Only qualifying growth above the agreed baseline is retainable.
The policy requires a reinvestment strategy so that retained income supports Investment Zone objectives.
Once properties become occupied and relief periods mature, NDR will become an increasingly important long-duration financial stream extending well beyond the ten-year Investment Zone funding period.
The national framework establishes a substantial reporting regime and consideration of mandatory Government reporting. There is clear evidence that government monitoring financial reporting, performance reporting and evaluation, is required.
Accountable Bodies must provide formal reports every six months, supported by internal programme monitoring.
Reports are expected to cover matters including:
NESIZ’s later published records should therefore eventually permit comparison between:
approved business case → Annual Delivery Plan → six-monthly monitoring → expenditure → outputs → outcomes.
Delivery only formally commenced in 2026, therefore reporting is still in its early stages, and not all is available so far.
The strongest transparency is around formal governance.
The weakest areas are increasingly commercial projest appraisal, detailed programme finance, programme board deliberations and government facing monitoring. This is not a conclusion of administrative failure, just that the evidence is not as yet available yet.
Future monitoring will hopefully identify any reporting gaps that have still not been published, rather than being interpreted prematurely.
NESIZ now has strong evidence of dedicated political governance and project-level implementation, but consolidated programme reporting remains less visible
The £1.7 billion investment and 18,000-job figures must continue to be labelled as forecasts until measurable evidence demonstrates otherwise.
