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Michelle Thomson is absolutely right to say that the wider UK environment is a big determinant of what happens in Scotland. We know that there are challenges with productivity, which are linked to private reinvestment and investment in innovation. We want to encourage as much of that investment as possible. That is a UK-wide challenge and a UK-wide trend. How we are perceived internationally has a massive bearing on that.

I know of a number of major corporations that have previously been active in the UK but which left a couple of years ago for various reasons. When we have engaged with those corporations, they have said that they are sympathetic to what the Scottish Government is trying to do, but, at the end of the day, we sit within the wider United Kingdom, which will have a bearing on what they can and cannot do.

What Rachel Reeves does with the budget in October will matter massively in terms of incentivising the reinvestment piece. How she will use the tax system to incentivise reinvestment and how she will ensure that the UK as a whole is considered to be open for business will matter. That will work either in favour of or against what we are trying to achieve.

The other big issue is labour shortages. Today, RBS said that hiring activity has surged and that job creation has reached its highest level since May 2023. That is positive if the workforce is there, but if there are constraints on the labour market, which we know there are, employers will continue to face staff shortages. In September, 24.7 per cent of firms reported experiencing a shortage of workers, although that is lower than the average rate over 2023, which was 33 per cent.

Those macro trends and issues clearly have an impact. There has been a lot of speculation about how Rachel Reeves might adjust debt and accounting rules to allow greater capital and infrastructure investment. I would welcome such a change and the flexibility that it would bring.

Financial transactions grew considerably under the previous Conservative Government. They were a very helpful resource for us in housing, as your neighbour on the committee, Willie Coffey, will know, and they were a means for us to significantly capitalise the Scottish National Investment Bank rapidly.

Financial transactions are a loan mechanism, as you say, so they are not capital; they must be returned to the Treasury at the right point, but they allowed us to extend the reach of our capital. Last year, they were cut—if memory serves—by over 60 per cent, which was a huge hit in one year. Taking on board that hit in one year was a mammoth task for all the housing programmes and the Scottish National Investment Bank programmes that were explicitly reliant on financial transactions. That required us to redivert capital from elsewhere to continue to support those programmes.

We do not know what Labour will do with financial transactions, and we do not know how it feels about financial transactions. It is clear that there will be more consequentials if the UK Government increases what it is doing on housing. At the end of the day, in order to capitalise the Scottish National Investment Bank we want to use capital, but there is a concern about rediverting capital from new schools, hospitals and roads to the Scottish National Investment Bank, so we will have to weigh that up.

I do not know whether any of my officials want to respond to that. It remains our intention to return the business to the private sector. We will update Parliament at the appropriate time if a proposal is received that represents good value for the taxpayer and continues to deliver benefits to Scotland and the local economy in Ayrshire. I am conscious, in these quite sensitive periods, of the need not to say anything that jeopardises either the commercial element or overspeaks in a political context.

Great.

We are still examining all options to bring forward new projects and employment opportunities at Grangemouth, entirely because of the economic impact that Michelle Thomson has just outlined. That is where the joint working between the Governments to consider viable options for the future of the site, including the feasibility of transforming it into a low-carbon fuels hub, comes in.

Along with support from Petroineos, the Scottish Government and the UK Government are very much willing to support options that will achieve the aim of trying to maintain, or almost increase, the economic activity that goes on at Grangemouth. We want Grangemouth to retain its position as Scotland’s foremost industrial site well into the next decade and beyond, and the UK Government is committed to exploring routes to supporting the next stages of all those options via the national wealth fund.

I appreciate that that is not a substantive answer on what happens next, but I absolutely share Michelle Thomson’s view that we cannot take our eye off the economic impact around labour and the support for our energy mix.

I keep a close eye on the accounts for Prestwick airport. The most recent ones were published on 16 November 2023 and show a continued positive picture, with the airport posting a profit in 2022-23. I do not know whether we have a specific date, but the next year’s accounts are due for publication some time in late autumn.

Glasgow Prestwick has developed as a specialist airport and has carved out a niche in a competitive aviation market. I do not think that it should necessarily be competing with Glasgow; it should continue carving out that niche. We would not intervene in commercial decisions that are taken by the airport, but I would want the management to consider all potential business opportunities in order to maximise use of the airport’s assets.

You have gone through the statistics, convener, so I will not repeat them, but the pathways review happened in the first place because of those concerning statistics. The other statistic that I would use is that 2p of every £1 of investment goes to female founders. That, in itself, is quite stark and also means that the statistics that you have outlined come as no surprise given the state of investment in businesses with female founders.

I remain extremely committed to implementing the recommendations of the pathways report. The pathways fund opened on 19 July this year, making up to £1.1 million of funding available to widen access for entrepreneurs. The fund was very successful: by the time that it closed on 30 August, it had received 130 applications and officials are now working to confirm grant awards.

A lot comes back to the issue of data. We have taken on board the need to improve data collection, which is a work in progress. We are working with delivery agencies and academic partners to improve our understanding, monitoring and reporting of data relating to participation in entrepreneurship. I am sure that the committee will be interested if and when we can give an update on what we have done as a result of that work.

I think that it was a really good piece of work. It was very conscious of the trade-offs that would have to be made in terms of the long-term finances, and I stood up and defended it in evidence to multiple committees.

That is a very interesting observation. You are right to say that there is a distinction between them. We are, as it were, trying to support the delivery of the sustainable development goals, but this is a Government document—in other words, an organising document. It is trying to embed the northern star of the UN sustainable development goals in our own work and in the work that we want other agencies and actors in Scotland to do.

However, I also think that the tension that you have talked about is what makes reporting so challenging. The ultimate reporting with regard to reducing poverty, for example, is that you have reduced poverty, and the ultimate aim of the environment or climate change objectives is that you meet the climate change goals. The key is how you measure that over time to know that you are on the right track. We have the reporting on the child poverty statistics, for example. They are not national performance framework statistics; they are Government statistics, but you can use them to say whether the national performance framework is achieving its aims.

That is why it is perhaps more messy than the committee would like. It would be much easier to just measure inputs and outputs quite tightly within the remit of the national performance framework, but I think that it goes much broader than that.

That is an excellent question, and officials might want to come in on the role of local authorities in setting these things.

It is hard—arguably, too hard. Again, the committee will have ideas on this. Although a lot of data is collated on a local basis—we know where there are higher levels of poverty, for example—that does not mean that the effectiveness of local bodies in tackling the issue is being monitored. We know where the starting point might be too high, but often, there is a lot of focus on what national Government is doing to tackle these things, while the role of local authorities is forgotten.

By its very nature, your question echoes Michael Marra’s question, in that we must not confuse political manifestos with the national performance framework. Every local authority around the country is made up of different political colours with different views on how to achieve a particular aim. Therefore, local authority administrations that are more aligned with your party might have very strong views on how to achieve economic prosperity, and that would be an indirect route to reducing poverty. On the other hand, others will be more explicit about aims and ambitions that are directly linked to the child poverty ambition. In a dictatorship, you might be able to just say, “Here’s the national performance framework. This is how we are going to do things around the country.” That is not our style, and, indeed, I do not think any of us wants to get to that point.