Seòmar agus comataidhean

You are right to point to port infrastructure being really important, and we remain absolutely committed to the funding of not just the new vessels, but the port infrastructure to support the ferry services. That is why the infrastructure investment plan set out funding of £580 million and why we have provided more than £100 million in further funding to allow, for example, the purchase of new vessels for Little Minch.

There are two parts to the infrastructure investment plan going forward. First, there will be an update at the end of this month on the projects that are already in train and where they are with regard to any delays.

Secondly, we will produce the next phase of the infrastructure investment plan later this year. We would have liked to align that with the budget but, as you will appreciate, there are quite a lot of uncertainties, given the capital outlook, in where the spring budget will leave us with capital funding. However, we will set out the next iteration of the infrastructure investment plan.

There is no doubt that capital budgets going down will have an impact across the board, but where we are investing in new vessels, we clearly need to make sure that the port infrastructure is there, so that the new vessels have the required infrastructure. That is an important priority.

You mentioned one or two issues in relation to port infrastructure; there are a number of them. As we get the detail on any changes or amendments to the infrastructure investment plan, we will be happy to provide you with that. The next iteration of the infrastructure investment plan will be published later this year.

In summary, there might not be an even or straight road of investment each year for organisations, with investment continuing to grow; the position will fluctuate. The availability of capital funding will be constrained, so we need to think carefully about how we might be able to lever in external funding to support some of our objectives, given that we will have less capital funding available.

However, the ambition remains, and we will ensure that we are able to show, as we have done in annex J, how our investment for 2024-25 will be focused. That has to be set in the context of future years, with investment going to ensure that we are on track to meet the targets that you alluded to.

I set out at the beginning of this evidence session that we are investing £4.7 billion of capital and resource in positive action in the 2024-25 budget to meet our climate change goals. One could argue that, if whatever amount of the up to £350 million of ScotWind moneys is part of supporting the budget, it is also part of supporting that £4.7 billion of the budget that is tackling climate change.

My dilemma is that in an ideal world—with funding not being so constrained—we would indeed want to create a different fund, almost a sovereign wealth fund or something that would be specifically geared to future action on climate, but, given budget constraints, I would face questions across Parliament were I sitting with £350 million that was either unallocated or being kept for tough times. These times are the toughest, and I am having to use that money to support the budget. Because it is not aligned to a particular part of the budget, the point that I am making about the £4.7 billion is that it supports the budget as much as investment in the national health service or Social Security Scotland. It supports the budget in general and, without it, we would frankly have to make even more difficult decisions than we have to make at present.

The £4.7 billion that is in the budget—

In 2024-25, we are committing £4.7 billion in capital and resource for activities that will have a positive impact on delivering our climate change goals.

As you know, we are enhancing the way in which we categorise the Scottish budget spend. The budget’s dedicated climate annex, annex J, outlines an enhanced taxonomy approach—basically, that is categorisation. It sets out changes to the methodology, expanding its use from just the capital spend that was previously analysed to include resource spend. I hope that that will provide greater transparency for the committee and others across the Parliament on the spend’s alignment with the Scottish Government’s climate objectives over its lifetime. It evaluates each spend line on its potential impact on either Scotland’s emissions generation or its adaptation impact. That will help us to compare not just one budget to another but the trajectory towards the targets. The detail is in annex J, which sets out, across the Government in the various portfolio areas, the positive impact of the cumulative £4.7 billion that will help us on our trajectory.

We have work to do, as every Government has. The target is challenging, as you know, and we have to continue to consider not just the spend but the policies that the Government needs to take forward, some of which are extremely challenging. All of that will be important to make sure that we deliver what we need to deliver.

We are as confident as we can be that we are able to show and demonstrate where the spend—in capital and resource—has a positive impact. However, we cannot rest on our laurels. It is a journey and it has to accelerate. That means that we have to be able to demonstrate not just the spend but the impact of that spend, and our ability to accelerate the changes that need to be made.

Those issues and challenges are not unique to Scotland. Every Government around the world is wrestling with the competing demands of the here and now and the investment that needs to be made—whether that is in changing our transport system or in heat in buildings—that competes with other priorities. Those are really difficult challenges, but that figure and the enhanced presentation of the budget should give the committee and the Parliament as a whole the ability to scrutinise the issue and the spending decisions that we make.

We can certainly provide you with the information on the detailed discussions with that organisation about its targets. In difficult times, we have had to prioritise where resources will have the most impact, and part of that discussion involves looking at organisations’ reserves. I am not saying that it is the whole picture or that it replaces every pound; all I am saying is that it is taken into account in relation to the funding that organisations have to deploy.

Okay—no worries. SNIB’s investment decisions are for SNIB, and we expect it to use its expertise around the table, which is considerable, in making the investments that will align with our priorities, particularly regarding net zero investments.

On funding, SNIB has traditionally relied on financial transactions, because it can make good use of them. FTs are a bit limited in where they can be deployed. Traditionally, FTs have been deployed for affordable housing, and SNIB has been the recipient of them. Unfortunately, the number of FTs that we have had from the UK Government has declined significantly. For 2024-25, I think that they are in the region of £160 million. Therefore, we have taken the decision to put all the FTs to SNIB for its investment programme. We expect SNIB to use that investment in a way that aligns with our priorities.

If you are asking me whether we would have wanted to give more money to SNIB, my answer is, in an ideal world, yes. However, given its reliance on FTs, we are not able to do that because we have fewer FTs to distribute. I will ask Neil Gray to comment on the advisory board.

That is very much the case. In every budget, there is always a tension between investing in the here and now, for example through mitigating the cost of living crisis and supporting household budgets and some of the most vulnerable—the £6.3 billion investment in social security speaks to that—and investing for the future. There is always a balance to be struck.

Clearly, some of our budget is for the here and now—the everyday, and keeping people’s heads above water. If we did not do that, we would be asked why. We are balancing that with some of the investments that are very much about the future and the climate change targets—putting in place the building blocks. The budget attempts to do that. We have the £6.3 billion investment in social security, but we also have £4.7 billion of capital and resource investment that is directly attributable to having a positive impact on the climate change goals. Some of that looks to the future and some will be for the just transition. Around the Cabinet table, we often have to wrestle with those competing demands.

Yes.