The Scottish government has provisionally backed plans to fund the £73m plan to redevelop the former Ravenscraig steel works through tax incremental financing.

The deal will allow North Lanarkshire Council to borrow money against future increases in business rates income.

Scotland has so far led the way in the use of TIF in the UK after approving the first TIF scheme in September last year for the £84m upgrade of Edinburgh’s waterfront.

The Scottish Futures Trust (SFT) was set up b y the Scottish government to reduce to cost of funding public sector projects and has led the development of the TIF model for use in Scotland.

David Melhuish, Director of the Scottish Property Federation, said Scottish ministers should be congratulated.

“Whilst TIF still waits to get off the ground in England it has now proved crucial in progressing two vital regeneration schemes when the Scottish economy needs most help.”

Peter Reekie, Director of Finance and Structures at the SFT, said he was delighted the deal has received provisional approval.

“SFT has led the development of the Tax Incremental Financing (TIF) model for use in Scotland and worked with the Local Authorities to bring forward the Business Cases which together will bring £150m investment in infrastructure unlocking more than £1bn of private investment in these regeneration areas,” he said.