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Mr Robertson can come in on that on a moment, but first, just so that I am clear, I ask whether those are Treasury accounting rules or Scottish Government rules. Where is the blockage?

Thank you, convener, and good morning, gentlemen. I will ask about financial performance. My first question is for SNIB, following Lorna Slater’s earlier questions. SNIB was established to be a perpetual institution with its profits reinvested. Last year, when SNIB chair Willie Watt gave evidence to the committee, our colleague Michelle Thomson asked Mr Watt about that. At that point, he said:

“Government accounting rules are not helpful in that regard, but we are talking to the Scottish Government about those issues.”—[Official Report, Economy and Fair Work Committee, 21 June 2023; c 23.]

Could you give us any update on that challenge and on whether it is proving to be easier to reinvest profits or whether there is still a barrier to that?

Thank you. I have a couple of other questions on financial performance, the first of which is for SNIB. You will be aware that the issue of bankers’ bonuses is politically contentious. I am aware that the SNIB pays such bonuses. There is a long-term incentive plan that sets out the performance conditions that relate to them. What are the performance measures that determine whether bonuses are paid?

I will come to Scottish Enterprise in a minute, but first I have one more question for SNIB. I noticed that, according to the accounts, in 2023-24, which was the most recent financial year, you spent £96,000 on contracting with a public relations firm. What was that for?

I have one question for Scottish Enterprise. Your accounts for 2023-2024 show a significant change in emphasis in spending priorities, with a shift away from business growth and towards innovation and investment.

Scaling up businesses is one of the key objectives of the national strategy for economic transformation—NSET—so why has there been that shift in priorities? Is it simply driven by the reduction in your budget?

Good morning, professors. I will follow up on the convener’s line of questioning about who pays. Professor Bell, I was interested in something that you said about transitioning from gas boilers to heat pumps. I will give a small illustration.

I visited a new housing development in my region a couple of months ago. They were nice new-build houses, with a very high specification, and were heavily insulated. I had a conversation with a house builder about the heating system. All the houses are having gas boilers installed. I asked why the builders were not putting in heat pumps, and the answer was that the customers do not want them, because there is an additional cost—£8,000 per property, I think they said—and, in that market, the customers are not interested in paying that. I would like your perspective on that.

I will also put my broader question. It seems to me that, on the issue of net zero, it is easy for politicians such as us to set targets for 10, 20 or 30 years in the distance, then pat ourselves on the back and say how well we have done. The practicality is in trying to implement measures such as heat pumps when the public says, “Wait a minute, we are not prepared to pay for that.” The question of who pays therefore becomes absolutely crucial. Professor Roy talked about the situation with the public finances. The Government will struggle to pay. What is the scope or opportunity for private finance to come in, and is enough being done in the financial markets to bring in models, opportunities and products that can help to fund the just transition?

I have a couple of follow-up questions. On that last point, it is really interesting to look at where the public are. I hear this pushback all the time—people say that, even if we get to net zero tomorrow, if the rest of the world does not, it will make no or little difference. The challenges that we face, whether in Scotland or the UK, are exactly the same challenges that other western economies face. Everybody is on the same trajectory as we are on, everybody is pushing back on targets and everybody is going slower because of the fiscal and economic challenges. Trying to win the public over against that backdrop is much more challenging, is it not?

Professor Roy, I will put to you the same question that I put to Professor Bell. Do you think that the financial products are there? Over the past couple of decades, lots of different schemes, such as the green deal, have come in. All those schemes seem to come and go, and people do not have any sense of what they are. If you came to me tomorrow and said, “Put in a heat pump and there will be some scheme to help you fund it”, I would not know where to start, because those schemes change with such regularity. First, is there a need for certainty on what is on offer from the Government and the public sector? Secondly, are the financial products there?

I have one more follow-up question, which might be for Professor Roy.

Do you have a view on how effective the Scottish Government has been to date in drawing in private investment through city region growth deals, the Scottish National Investment Bank and the green investment pipeline, for example? Has that been successful overall or have there been weaknesses in the experience?

Your submission includes numbers on the multiplier effect in public spending, which suggests that, if public money is put into an area, it will generate more economic activity there.

You would therefore expect to see the impact of this reduction in the current year.