The UK Government has confirmed the £5 million capital investment funding pledged to Perth and Kinross Council in the Spring 2024 Budget has been withdrawn.
The money, from the previous Conservative UK Government's Department of Levelling Up, Housing and Communities, had been earmarked for three projects to support culture and regeneration in Perth city centre.
These projects were to create a visitor attraction and office space at Lower City Mills, to create an exhibition and retail space at The Ironworks and a high street outlet for micro producers.
Perth and Kinross Council leader Councillor Grant Laing said: "We are all well aware of the financial challenges facing the UK but this is an extremely disappointing - and, in my opinion, short-sighted - decision.
"We have three excellent projects ready to start, all of which would help to breathe new life into Perth city centre for the benefit of residents, businesses and visitors.
"Perth fought hard for a share of funding. When the £5 million was announced in March this year I was pleased the UK government had finally recognised the value of investing in Perth and Kinross, even if we received a smaller share than many other areas.
"To have the rug pulled out from under us by the new Labour government now simply adds insult to injury.
"We will look to see if other sources of funding is possible for these three projects and continue our ongoing efforts to regenerate Perth city centre."
Perth and Kinross Council Chief Executive Thomas Glen said: "It is extremely disappointing the new UK Government has chosen not to uphold the pledge made to Perth and Kinross in March.
"These three projects are part of our ambitious plans to regenerate Perth city centre but they require funding to become a reality.
"Consultation on the Perth City Centre Design and Development Framework, which sets out our ambitions for the city, will begin in November."
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