Scotland announces £10 million fund for island business resilience

The Scottish Government has announced the first phase of a £10 million Islands Resilience Fund designed to support businesses affected by ferry disruptions. The initiative includes a further £3 million allocated for 2026-27, building upon a previous £4.4 million fund. First Minister John Swinney noted that the fund aims to help island businesses cope with circumstances beyond their control, ensuring the islands remain viable places for livelihoods.

Highlands and Islands Enterprise (HIE) will manage the delivery of the fund. To streamline the process, organizations that received support through previous rounds of the Islands Business Resilience Fund will be contacted directly by HIE rather than being required to submit new applications.

In a separate development regarding island infrastructure, the Shetland Islands Council has approved up to £2.5 million in contingency funding for the Fair Isle ferry project. This reserve is intended to address potential shortfalls in the risk allowance caused by weather-related delays, ground conditions during dredging, and existing infrastructure issues. The total project, which aims to replace the Good Shepherd IV ferry and upgrade local harbors, is expected to be completed in November following previous delays.