Controversial plans to turn the former Royal High School in Edinburgh into a luxury hotel have been backed by a new study which claims that the £75 million development will generate £37m a year into the Scottish economy over 12 years and support 900 jobs across the country.

The study, carried out by the consultancy Oxford Economics and commissioned by the proposed hotel’s developers Duddingston House Properties and Urbanist Hotels, concluded that the two-year construction phase and the first ten years of operation of the hotel would on average support 790 local jobs and inject £31m a year of GDP into the Edinburgh economy.

On average for every person employed on the project directly a further two Edinburgh-based jobs could be supported by supply chain, employee spending and visitor spending effects, the report said.

The development would also generate £16m of annual tax revenues, which the report points out would be enough to cover the wages of around 500 full-time nurses.

Rosewood Hotels and Resorts, the Dallas-based international luxury hotel chain who would operate the hotel, calculate that it would employ 264 staff at the five star hotel.

Planning permission for the scheme on Edinburgh’s Calton Hill was submitted to Edinburgh City Council earlier this month with a decision expected in December.

Last week a trust hoping to move a music school into the neo-classical building made an offer of £1.5m to buy the historic building, which is one of Edinburgh’s most distinctive landmarks.