Angry Dundee leaders condemned a decision to snub the city for £80 million of investment and tax breaks.
Aberdeen and Glasgow were granted the status instead as part of a joint UK and Scottish Government decision.
Dundee Labour MSP Michael Marra said: “The Tories and SNP have colluded in a political carve up and then plunged the knife in Dundee’s back.
“This decision beggars belief.”
SNP city council leader John Alexander immediately wrote to his Scottish Government party colleagues to criticise the decision.
“It is disappointing that Dundee appears to be the only major Scottish City that will not benefit from government intervention in terms of Greenports, Innovation or investment zones,” he wrote.
What are investment zones?
Investment zones are part of the UK Government’s “levelling up” plan to target regions of the country for development and support in jobs and skills.
Tax incentives could include reduced Land and Buildings Transaction Tax, business rates relief, capital allowance and National Insurance contributions.
Dundee put forward a bid drawing attention to its world-class university research, high-tech skills base, life sciences and digital expertise – and the need to improve the region’s economy in general.
It was proposed to take in Dundee and north-east Fife, including St Andrews.
Investment zones were scored by governments but also discussed more generally by administrations before decisions were made.
They are not to be confused with Freeports, which offer wider customs and tax incentives and were awarded to bids last year at Cromarty and Forth ports areas.
Dundee-based SNP leaders held talks
Dundee MSP Shona Robison – the deputy first minister – held talks with UK Government levelling up chief Michael Gove recently.
He also spoke with First Minister Humza Yousaf, who lives in Dundee.
But the awards went to Aberdeen and Glasgow.
Mr Gove said the decision is a “historic milestone”.
“I am very appreciative of the constructive approach the First Minister and Deputy First Minister have shown in the meetings I have had with them in recent weeks,” he said.
“We all have a shared ambition to work together to see all parts of Scotland thrive and today’s agreement builds on our successful rollout of Green Freeports in Scotland earlier this year.
“Both Aberdeen and Glasgow, and their surrounding areas, have been at the very heart of the UK’s economic success for generations.”
UK Scottish Secretary Alister Jack hailed the “exciting news” for the two winning city regions.
“We have worked closely with the Scottish Government throughout, which shows again what can be achieved when Scotland’s two governments work together to promote a fair spread of opportunities across Scotland,” he said.
The Tories have never cared about Dundee, the SNP now take it for granted.
– Labour MSP Michael Marra
Mr Marra, who covers the North East region which takes in Dundee and Aberdeen at Holyrood, questioned the process.
“We officially have the best life sciences research of any University in the UK – bar none,” he said.
“Our local economic need is acute. No objective assessment for this kind of scheme would have seen Dundee missing out again.
“The SNP and the Tories are conspiring to put their political interests ahead of the people and it is Dundee that is losing out as a result.
“The Tories have never cared about Dundee, the SNP now take it for granted.”
Dundee ‘sensible’ choice
In Dundee, city leader Mr Alexander is now trying to get an explanation from Scottish Government minister Neil Gray.
In his letter, Mr Alexander wrote: “Despite the city’s concentrated and collective efforts, we remain in a position where business growth rates and private sector jobs within the workforce are lower than national averages.
“There have undoubtedly been improvements, but we need to accelerate that pace of improvement if we are to deliver our collective ambitions and I cannot do that in isolation. It will require national support, in addition to local drive.
“If such zones are predicated on the need to address inequalities across the UK, support tangible economic growth and to do so in a way that brings together the private and public sectors, I believe Dundee would have been a sensible choice.”
Scottish Government minister Neil Gray said: “A rigorous process has been followed in selecting Glasgow city region and the north-east and we look forward to working in partnership with them to create high quality jobs and ensure that fair work practices, including payment of the real Living Wage, are embedded in the Investment Zones from the outset.”
