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Given that the bill has been through its third reading, the suggestion is that it will be left to officials in the Department for Business, Energy and Industrial Strategy to further define the rules. We have our own constitutional consideration in the Scottish Parliament, but I suggest that, regardless of where you sit, having an unelected official in BEIS making the decisions, without reference to the House of Commons or to the Scottish Parliament and the Scottish ministers, is not entirely desirable from a democratic perspective. What is your view on that?

I will ask a final wee question. Have you had any discussions about the potential cooling effect on much-needed investment in the light of post-Covid recovery? Surely any Government would want to encourage investment. It would surprise me if it did not. I say “cooling effect” because we have been told that the rules not being clear could lead to legal battles, which are obviously expensive, so the likes of local councils would probably not want to take the risk. Have you had any discussions about that? Have you made that point clear? Is it understood?

I note that there is also a role for the private sector. We need to consider getting it to change its behaviour, given that only 1 per cent of private equity funding goes to female-led businesses while 99 per cent goes to male-led businesses.

Moving on quickly, I have some questions about the Scottish National Investment Bank, which I am very interested in. Some people are not clear about the fact that the Scottish Government has no control over most regulations on property and labour markets, the international migration regime or overall macro monetary policy. However, one of the key ways in which the Scottish Government can really make a difference—I am glad to see this happening—is by protecting the funding for SNIB after the withdrawal of FTs.

Despite that, the chair said in November that the bank would still like to be able to raise third-party funds. Have you considered that? The consumer prices index, which is reported today to have reached 5.4 per cent and is probably only going to get higher, will have an impact on the difference that the bank can make. Have you given any further thought to whether SNIB can raise money from private sources? Are you constrained in any way in allowing that?

I noticed that, when you appeared in front of the Public Bill Committee at Westminster on 26 October, you stated:

“From the point of the view of the devolved Administrations, for example, the passage of the Bill will still leave them pretty much in the dark as to what they can and cannot do.”—[Official Report, Subsidy Control Public Bill Committee, 26 October 2021; c 12, Q8.]

Do you stand by the observation that you made then?

Thank you. I am aware of time, so I will stop there.

How have we ended up in the position in which the bill will go through its second reading later this month—next week, I think—yet we still do not have the necessary level of definition? It is possible that the bill could go all the way through and, under what is proposed at the moment, it will be left to the Department for Business, Energy and Industrial Strategy to make the decisions. I do not want to put words in your mouth, but the bill seems to have the potential for bypassing ministers in the UK Government, never mind the Scottish Parliament, altogether. How on earth have we ended up in this position?

Before we hear from others, do you think that, if the SNIB is fundamentally constrained to operating in areas of market failure, that could—from a risk perspective—have a cooling-off effect for the bank? Obviously, the bank’s risk assessments will be tightly honed, given the nature of what it is doing.

I see that George Peretz wants to come in.

I am keen for others to have the chance to respond. The point that we started with is that, first and foremost, the detail to establish a scheme needs to be in place, and it appears that that detail, whether specifically for the SNIB as regards its role in relation to market failure and beyond, is not yet clearly established.

I am aware that other members want to come in, but before I give way to them, perhaps Professor Fothergill or Mr Heddle would like to respond to my question about the SNIB.

Good morning, everybody. We have received quite a few submissions about the bill’s potential impact on economic development. In his submission, Professor Bell points out the difference between horizontal and vertical development. It is perhaps a matter of regret that we do not have a representative of the Scottish National Investment Bank on the panel. As you will be aware, the SNIB involves an investment by the Scottish Government of £2 billion over 10 years, which is a serious amount of public money. In its submission, the bank says:

“It goes without saying that if development banks are to be constrained to operating in areas of market failure, the new UK Subsidy Control Regime must be at least as wide as its predecessor, and/or sufficient discretion to public bodies and devolved administrations afforded.”

I want to get your views on the Scottish National Investment Bank in particular, as it seems to be a slightly different model, given that it was set up specifically to aid economic development in Scotland in a key way, not least on net zero. I imagine that, if that is the case for the SNIB, it will also be an issue for the British Business Bank. Perhaps Professor Fothergill or Professor Bell might like to answer in the first instance.