 The next item of business is debate on motion 12076, in the name of Keith Brown on the Scottish National Investment Bank. May I ask those who wish to speak in the debate to press the request to speak buttons and I call on Keith Brown to speak to it and move the motion up to 12 minutes, please, cabinet secretary. Thank you, Presiding Officer. It's just over a year since the Scottish Government's Council of Economic Advisers identified the importance of long-term patient capital in supporting economic growth. I'm building on this. We announced plans to establish the Scottish National Investment Bank in the 2017-18 programme for government. The First Minister asked Benny Higgins, the former CEO of Tesco Bank, to lead the work on the case for Scotland having its own national investment bank. Mr Higgins' insight, commitment and vision has led to a unique and game-changing set of proposals. His plan sets out a clear vision of what a national investment bank can achieve and the practical steps that will be required in order to make that vision a reality. The cabinet has been impressed with the breadth and depth of Mr Higgins' work and the advisory group that he gathered around him. The prospect for a national promotional bank has therefore never been more certain. The First Minister made several important points when she received Mr Higgins' implementation plan on 28 February. First of all, the new bank should be a public body and it should operate independently with a strategic framework that is set by government. It should be mission-driven. It should focus on investment that is not currently being provided by the market in a way that seeks to shape and to create markets. It should address Scotland's economic priorities in an inclusive and ethical way. I can announce the day that the cabinet has considered in detail the proposals outlined in Mr Higgins' plan and has agreed that the Scottish Government will accept all 21 of the recommendations that are made by Benny Higgins. I do not have time to speak to all 21 recommendations here, but there are a few key points that I wish to highlight. We, I believe, have made great strides in the economy, such as encouraging more ambitious startups and more companies of scale to provide the jobs of the future and to improve business expenditure on R&D. We have helped to achieve higher investment in the rest of the UK and to help to close the productivity gap. However, we still lag behind comparator countries and there is considerable variation within Scotland. However, since the financial crisis, finance for small and medium-sized firms has been in shorter supply, and that has had an impact on our economic growth before we factor in Brexit. Looking ahead, we need to be able to meet head-on the great challenges of the day, such as decarbonisation, demographic change and the need for more inclusive growth. In many countries around the world with investment banks, they benefit from the provision of patient strategic investments that focus on the major economic challenges. National promotional banks play an important role in actively creating and shaping new markets, helping countries to rebalance their economies, improve productivity and tackle big societal challenges. Countries such as China, Germany and other European nations are proactively confronting key social and environmental challenges in this way. For example, the German KFW supports SMEs, export promotion, environmental protection, innovation and international development. This has been championed by Mariana Mazzacuto through her membership of our Council of Economic Advisers, and I would wish to thank her for her work on this. This bank's role in financing and directing investment by leveraging public and private capital into a significant source of strategic and long-term finance can be channeled into key areas and can be transformative for our economy. I am grateful to the cabinet secretary for giving way at this point. We already have a Scottish investment bank, the SME holding fund and Scottish Enterprise, all supporting business. Can the cabinet secretary illustrate how the new bank will provide functions that are not provided by the current institutions? Keith Brown First of all, it is worth saying that it will come on to this later on in my speech, that the two of the three instruments that are mentioned by Murdo Fraser should be working within the bank in due course, so that should help in terms of any clutter. Both in terms of the scale of the monies available to the investment bank and the activities and the idea of shaping new markets are two of a number of ways in which it will be different from that that has gone before. That seems to have been accepted by the stakeholders and many commentators in terms of the case for the bank. The Scottish Government, as I say, has accepted the plan's recommendation on capitalisation, and it is committed to investing £2 billion over 10 years. That scale is deemed to be both ambitious and achievable, making a material difference to the supply of capital to the Scottish economy. It requires an average of £200 million per year of capital from the Scottish Government over a decade. £2 billion, as an initial target, is consistent with other national investment banks. International comparators indicate that the level of public capitalisation typically ranges between 0.5 and 1.5 per cent of GDP. In a Scottish context, £2 billion broadly equates to 1.3 per cent of GDP. We have already taken the first steps. The 2018-19 draft budget included £150 million over three years for a new building Scotland fund. That fund and its investments should in due course come under the bank's remit. A further £340 million is to be made available between 2019 and 2021, subject to future budgets. That means that almost half a billion pounds has already been identified as the initial down payment on the £2 billion figure that I have mentioned. That is only the start of building up a significant asset base. A key objective of the bank will be bringing in additional capital from private sector investors and to increase the number of active private investors in the Scottish marketplace. For example, co-investment with the business angel community is an established successful model that is already used by Scottish Enterprise. That is to increase the number of investment deals that are taking place in the early stage risk capital investment market and to grow the number of private sector players. The institution will operate on a commercial basis. It will offer debt and equity that should be repaid over 10 to 15 years. It will be independent from ministers with the board deciding where to invest and on what terms. That is essential in order for it to be flexible and responsive. The priorities for the bank will be set by ministers. The types of investment will be determined by the board. It should include strategic and patient capital over all stages of firms and businesses investment life cycle so that they are able to accelerate innovation and make a stronger contribution to the Scottish economy. Substantial financing for major projects that support regeneration and communities and investment in new ideas to help us to meet the key economic, environmental and social challenges. We want Scotland to be a leader of technological change, and the bank is essential to place Scotland at the forefront of economic change and innovation. Initial capitalisation is from financial transactions, so the bank will offer finance to private sector entities. However, dependent upon future capitalisation plans, the bank should be well placed to expand lending opportunities in the future. A unique feature of the bank is its mission-based approach to investment, and that means that Scottish ministers will identify a set of medium-term outcomes and a focus for the bank's investment. The bank will decide how it responds to those missions and will report its progress against those missions to ministers. Core to that will be the alignment of the bank with the wider economic strategy and the priorities that have been identified and set by the Scottish Government. That approach gives Scotland the potential to demonstrate global leadership on common challenges, including transitioning to a low-carbon economy, responding to an ageing population and wider population health, promoting inclusive growth through placemaking and regeneration. That is why the cabinet has endorsed those areas as the types of missions that we expect the bank to undertake. The Scottish Government will refine its expectations further and the mission is set for the bank through consultation with stakeholders. Initial contact was made with Her Majesty's Treasury officials about the bank and the additional year-end budget flexibility that will be required for it prior to publication of the implementation plan. The bank will need that flexibility in order to have the desired impact on the Scottish economy and the ability to effectively manage a pipeline of investments. There is precedent for that with the British Business Bank and, of course, the Green Investment Bank, which the Scottish Government proposed is used to inform the arrangements. Engagement with Treasury about that flexibility continues. The Scottish Government agrees that the bank should be a public body classified in order to ensure direct alignment between the activities of the bank, the broader economic policy and the Scottish Government's enterprise and skills agencies. The implementation plan recommended that all financing activities should come under the bank's remit, including the Scottish Investment Bank, as was mentioned previously by Murdo Fraser. Thinking on how the bank will relate to existing bodies, initiatives and financing activities has begun. Where appropriate, we believe that those should be consolidated within the bank. Existing business advice and support provided by the enterprise agencies and infrastructure advice via the Scottish Futures Trust should also be aligned with the bank's activity. There is an opportunity to enhance the work that we currently do to stimulate demand for finance in the Scottish economy and to enhance the financial readiness of firms. There is also an opportunity to streamline the provision of and access to finance for businesses. The bank will have a board with the chair of the bank and the non-executive board members appointed by the Scottish ministers. It is envisaged that the executive management team appointments will be made by the board. Work to establish the most effective operating model for the bank will be agreed during 2018. It is essential that the bank secures the right people. Despite its intended status as a public body, terms and conditions of employment must reflect its place in the finance sector. I am clear that that does not mean bankers' salaries, with all the negative connotations with which everyone is familiar, but it means a market-based approach that reflects the institution's requirements and characteristics. Further work will be undertaken to establish options for pay and salaries and overall conditions of employment related to the bank. Dean Lockhart Thank you very much. Just on the recruitment of the necessary people to run the bank, the estimate is that annual running costs of the banks will be around £30 million. Do you have any concerns about the duplication of costs that are involved in setting up and running this new bank, as well as the various other enterprise agencies? Can I remind members to speak through the chair, please? I can say that, first of all, I mentioned the considerations that have been given to declutting of the landscape, which could in turn realise some savings in relation to that. However, we do not envisage that the bank will be supplanting the activities and functions of the enterprise or other agencies beyond those that I have mentioned already, so I do not have a concern about that. There is, to be fair, more work to be done on the costs that are involved in that. However, the governance arrangements, such as pay and costs, will be subject to proper review and assessment, ensuring value for money and the control of costs through full and thorough scrutiny of plans for the bank's operation. Also, early establishment of a stakeholder group will guide further development of the operational detail, governance and accountability arrangements for the bank, and wider society interests will have a role in informing and shaping the bank, balanced against the board's independence and accountability. I am keen to explore ways in which that can be delivered. A bill will be brought forward in 2019 to establish and capitalise the bank, and we aim to have the bank operating in shadow form in 2019 pending the passage of this legislation. I believe that a publicly owned investment bank will become a cornerstone of the economy that we want to create in Scotland. It also has the potential to be truly transformative, operating under a core set of principles and missions, supporting sustainable growth and bringing benefits to individuals and communities across the country, making Scotland in the process a fairer and more prosperous country. Therefore, I invite the chamber to support the motion in my name. I call Dean Lockhart to speak to and move amendment 12076.1 for up to seven minutes. Thank you very much, Deputy Presiding Officer. This debate on the proposed national investment bank is important because Scotland's economy continues to face a number of challenges. Those challenges were highlighted in evidence given by Nora senior to the economy committee, which identified a number of economic targets that have been missed in the areas of productivity, innovation, internationalisation, business investment and economic growth, where Scotland has trailed behind the UK in every year since 2009. Failure to reach those and other economic targets has cost the Scottish economy more than £80 billion, so we agree that it is time for a step change in policy and to address some of those challenges that the Scottish Government has proposed in the establishment of the bank, which would, as the cabinet secretary said, provide greater levels of patient long-term capital, increased support for exporting companies and help SMEs to scale up. The implementation plan for the bank points to examples in other countries where national investment banks have improved economic performance. I have worked with national investment banks in China, Singapore and India and Japan, and I agree that they can improve economic performance. However, they can only do that if it is part of a coherent economic policy framework where there is clarity of focus and delivery, alignment across government, enterprise agencies and business and a supportive environment for the establishment and growth of business in the first place. Our concern is that this clarity, alignment and support for business has been absent from SNP economic policy for a number of years. As the Fraser Valander has commented, the SNP has lost clarity of focus and delivery with a myriad of different strategies advisory groups. I will, in a second, and bodies cluttering the landscape. Fraser Valander goes on to say that this is holding back growth, leading to confusion and a lack of alignment duplication and weakened accountability. I will give way. Derek Mackay Can I thank Dean Lockhart for taking the intervention? Can the member identify just a few strategies that the Conservatives think that the Scottish Government should do without? Dean Lockhart Well, the economy committee has been looking at the performance of Scotland's economy, and let me answer the question. The concept of inclusive growth, which is the Government's overarching strategy, has no economic meaning, nor a senior says that it means different things to different people. How can agencies align around an economic policy that has no economic meaning? That is one big area, I would say to Derek Mackay, that we would fix. I need to make some progress. We support many of the objectives behind those proposals, but the bank is being introduced into an enterprise landscape that is already cluttered and confused, and is being introduced through an economic policy framework that lacks strategic direction. Steckholders and business organisations have raised a number of those concerns in the consultation process. If the Scottish Government wants our support for the bank proposals, it will have to address a number of those concerns. First, the bank proposals need to avoid duplication of costs and activities and deliver greater value for money for Scottish taxpayers. Scottish taxpayers already pay over £100 per head more than the rest of the UK on enterprise development, but with poorer outcomes. The cost to the Scottish taxpayer is set to increase. The estimated cost of running the new bank, as I mentioned to the cabinet secretary, is £30 million a year. That is in addition to the £120 million that was spent on the other enterprise agencies on their operational costs. In other words, Scottish taxpayers will be forking out £150 million a year in running costs for those agencies, and that is before a single penny is given to help business. The cabinet secretary has to explain how he will cut out the duplication of running costs and achieve much greater value for Scottish taxpayers. At the second point that we want the Government to address is greater clarity on how the bank will interact with the various other existing enterprise agencies, something that has been touched upon. Jim McCall, in giving evidence to the economy committee, said that the landscape is too cluttered. The support needs to be more focused. We agree with that. If the bank is to have any positive impact on Scotland's economy, the Scottish Government will need to take steps to streamline the cluttered landscape. Perhaps the cabinet secretary wants to tell us how he is going to do that. I thank Dean Lockhart for taking intervention and saying that I have already mentioned a couple of examples in relation to the Scottish investment bank where that can happen. However, the cluttering of the landscape has been referred to by a number of commentators and individuals, and it refers to the activities of both the Government's involvement in the Scottish economy. Does he think that there is any scope for decluttering on the part of the UK Government? Dean Lockhart We have spoken about that before, but I think that this is a plan that the Scottish Government is putting together to address. Presumably, you think that you have control over some or most of those areas if you are putting a long-term plan together on that area. The bank has to gain credibility in the marketplace and be run independently of ministerial interference. We cannot have another repeat of the shambles that we saw last year with the Scottish growth scheme, where it was announced by the First Minister as a half billion pounds vote of confidence in the Scottish economy, only for less than 5 per cent of that amount to be made available to business. The Scottish Government's motion today talks about the bank helping Scotland to achieve its full economic potential. For Scotland to achieve its full economic potential, it is not enough just to make available additional finance. There has to be an environment that is conducive for small business to grow, export and scale up in Scotland, and the Scottish National Party's policies over the last decade have not helped this environment. The large business supplement punishes business for expanding. Increasing business rates are forcing businesses to close, and making Scotland the highest tax part of the UK is making it difficult for innovative companies to expand. The most important challenge that the Scottish economy faces today is the SNP itself. Failure by the SNP to reach its own economic targets has cost the Scottish economy more than £80 billion. Our amendment today reflects concerns raised by leading organisations across Scotland that the enterprise landscape is too cluttered and is leading to confusion, a lack of alignment, duplication and weakened accountability. We support many of the objectives behind the bank, but the Scottish Government must address the issues that we have raised today if it expects our support for those proposals in the future. I move the amendment in my name. I now call on Jackie Baillie to speak to and move amendment 12076.2 up to six minutes, please, Ms Baillie. Thank you very much, Presiding Officer. They say that good things come to those who wait well. We have been extraordinarily patient, because it is fair to say that it has been years since the Scottish National Investment Bank was first announced, then re-announced and re-announced again. In fact, I counted nine separate announcements spanning a number of years and cabinet secretaries. Let me truly welcome the imminent creation of the Scottish National Investment Bank and the acceptance of all the recommendations in the implementation plan. Having waited this long, I would at least have expected the plans to be slightly bolder and more ambitious. I welcome the implementation plan put forward by Benny Higgins, but I consider the amount of funding that has been announced so far to be quite timid. Now is the time surely for radical decisive action. Our economy is stagnating, and the truth is that we are flirting with recession. GDP for the last quarter showed growth of a mere 0.3 per cent. The Scottish Fiscal Commission are forecasting growth of less than 1 per cent up to 2020, and over the past few years our growth has trailed behind growth for the rest of the UK as a whole. That context makes stimulating economic growth an absolutely urgent priority. The problem for the Scottish Government in the past was that it had no means to capitalise the bank and so it never really truly got off the ground. Now, it has financial transaction money from the UK Government, described by the finance secretary Derek Mackay as funny money when first announced by the Chancellor of the Exchequer and now welcomed with open arms as a key part of the Government's budget. There is nothing quite like a convert, Presiding Officer, but whatever your view, it provides some of the capital that is required to fund the bank, albeit that it is loan funding. It is the scale that is the issue. £340 million announced so far, up to £2 billion in the next 10 years, is a start. However, I do not believe that that will create the kind of transformational change that we all want to see in the Scottish economy. In contrast, Scottish Labour would invest £20 billion over the same period in the Scottish investment bank, 10 times the amount proposed by the Scottish Government. We want to see the money invested in SMEs because they make up the overwhelming majority of our economy. We want to see the money invested in environmentally transformative projects and renewables and, of course, in innovation. There is much with which we agree with the cabinet secretary and I will give way. Keith Brown I thank Jackie Baillie for giving way. I will ask her on the £20 billion if she could maybe just itemise how much was allocated in Labour's draft budget for the Scottish national investment bank this year and how much she would intend to allocate from future budgets. Jackie Baillie I only have up to six minutes, but let me say not only would we match the plans that are currently in place, we would attempt to exceed them. I have described to you that Labour across the UK would put in place a £200 billion national investment bank of which Scotland's share would be £20 billion. I think that that is ambitious. The difference is that the bank would sit within a coherent industrial strategy that would both grow our economy and create jobs. That is not all, because the Scottish Government has access to capital borrowing of up to £450 million every year—some of which could also be used. However, Scottish Labour would go further. We would invest another £20 billion over 10 years as part of Labour's national transformation fund. That is serious money for key infrastructure investment and boosting research and development—something, again, I think, that we should all welcome. That is £40 billion of investment in infrastructure, housing, businesses and jobs growing the economy. That is the kind of investment that will be transformative, that is bold, ambitious and not simply tinkering about the edges. Aside from the difference in scale, there is the expectation of delivery. The SNP is very good. In fact, I would go so far as to say that they are excellent at making grand announcements, but they are not so good at delivering against them. We have the Scottish growth scheme, the centrepiece of the programme for government in 2016. That was to be a £500 million scheme that would help to transform the economy. However, since then, only 31 businesses have received investment. Just 6 per cent of the money that is available has been allocated. That, Presiding Officer, is woeful. I am not sure whether the criteria are too onerous or a bureaucratic nightmare, but whatever the reason, we need to do much better. We need access to the Scottish investment bank to be easy and simple so that barriers are not created that put businesses off from applying. It is one thing to announce money and another entirely to ensure that it is delivered to the businesses that need it. It is also important that the Scottish investment bank complements overall policy. However, the SNP Government lacks an up-to-date economic strategy. There is no industrial strategy. You do not even align yourself with sections of the UK industrial strategy as it affects Scotland. Commentators have observed that there is little policy alignment or coherence. The landscape is cluttered with various initiatives, but it does not add up to a policy whole. That is a pretty damning verdict. What it needs is ambition, a vision, a plan and then it is all about delivery. The Scottish Government should learn from the mistakes that it has made before and ensure that the Scottish investment bank has sufficient capital and is easy to access. Our economy is not in a good place. A Scottish investment bank could make a difference, but the cabinet secretary and the Government need to be focused on making sure that it actually really delivers. I move the amendment in my name. Before I invite Mr Wightman to speak, I remind members that whether it is part of a speech or whether it is during interventions, it is not private conversations that are going on and everything should be directed through the chair. I call Mr Wightman's six minutes. Thank you very much. Greens welcome this debate on the Scottish National Investment Bank. A wide range of thinkers over the years have advocated the creation of such a bank. Most recently, the New Economics Foundation, Friends of the Earth Scotland, Common Wheel and Move Your Money, whose 2016 report, Banking for the Common Good, outlined a vision of such a state investment institution and the role that it could play in Scotland. It is particularly important that the UK has a very distorted banking and financial services environment, with privately owned global institutions, a recent history of speculation and wealth transfers in property markets and the development of exotic derivative financial instruments, rather than a practice of investment in the real economy. In Scotland, too, we have a history and a habit of fetishising the financial services industry when, in reality, parts of it, such as the Royal Bank of Scotland, were historically destroying the economy rather than supporting it. Other countries in that context provide examples of more sustainable models of banking, such as the German Sparkasin 431 locally owned public savings banks, who own the eight lands bank and work with the German state investment bank Kfw, which the cabinet secretary referred to making loans. Indeed, the Sparkasin made 45 per cent of all long-term business lending in 2012 more than double what was made by German commercial banks. There is a lesson there, and I think that, one, we need to learn from as a matter of urgency. I note the Government's intention that the bank be bold and ambitious. We share that vision, but, as the cabinet secretary acknowledged in his opening remarks, there is much work ahead to make that a reality. My amendment lays out a number of the issues that we consider need to be addressed. In particular, although the implementation plan dismisses the argument for a banking licence, we invite the Government to consider whether the licence could offer greater flexibility in providing for the power to take deposits and create electronic money. In our amendment, we also focus on the need for a strategic focus on the future of the Scottish economy by investing in low-carbon technologies to build energy resilience. We highlight, too, the question of housing. No economy can be sustainable when growing numbers of its young people cannot afford basic, affordable and warm homes. With social renting off limits to all but the most financially challenged and affordable housing not worthy of that descriptor, an investment bank has a key role to play in providing the kind of strategic housing investment that is desperately needed. I question the focus in the implementation plan on catalyzing private investment to achieve a step change in growth for the Scottish economy. Growth, even inclusive growth, is a questionable goal when some of the key investments that we need in energy efficiency, for example, will in the long-term reduce conventional metrics such as GDP, as indeed will investment in sustainable transport. That is why we are not inclined to support the Labour amendment with its uncritical arguments for growth. Indeed, as Mariana Matsakuta said in the spectator this week, many businesses that we are told are value creators are actually value extractors. At an interview in the new statesman this week, she points out that, in fact, the financial services industry was never included in GDP until the early 1970s because many such services are no more than transactions and add nothing to economic activity. A public investment bank does not exist to plug gaps in conventional commercial lending. We all agreed on that. It should have a role in the prudent provision of patient capital, but its role should be strategic, focused and long-term. Our amendment calls for Parliament to have a key role in establishing the bank's ethical investment code, something that the implementation plan refers to merely as a backstop, but which, in our view, should be enshrined in the primary legislation establishing the bank. That legislation should also set down the mission, the governance and the accountability mechanisms. We also float the idea that the bank could provide a Scottish payments company to reduce the cost to small businesses of processing payments. Again, that cost reduction will lower GDP but increase productivity. Currently, around 2 per cent of the value of payments is lost to the Scottish economy, about £1 billion a year at a rough estimate. My amendment calls for a diverse board, a key piece of the governance framework, and a matter on which I would welcome the cabinet secretary's early confirmation. In the implementation plan, the scoping statement of the bank states that it should be set up to be an enduring institution that provides a strategic step change in Scotland's economic architecture. We agree, and for a start that means focusing on delivering an institution that thinks and does things very differently. That also brings the clarity and focus in the cluttered policy landscape, identified in Dean Lockhart's amendment, for which I have some sympathy. There are plenty of good examples of how to create effective public investment banks, and we would like to acknowledge the work of Professor Mariana Matsukatu and Laurie McFarlane in drawing attention to institutional and international examples of best practice. As a national financial institution, we all have vested collective interest to make sure that the bank will invest in projects and programmes that deliver a sustainable future. In conclusion, it would be helpful if the cabinet secretary could tell Parliament what discussions are under way with the Treasury, the Bank of England, the Financial Conduct Authority and the EU to pave the way for a bank that is able to raise its own finance and leverage its balance sheet. It would be useful if it could be clear on how the bank's mission will be set and confirm that that will be a role for Parliament. I move the amendment in my name. Thank you very much, Mr Wightman. By my omission and for the official report, I should have said amendment 12, 076.3. Scotland's growth is stagnant. A brush with recession this time last year has been replaced by marginal growth. Annual growth of 0.8 per cent in Scotland in 2017 compared with 1.8 per cent in the UK is pretty pathetic. When it comes to jobs, Scotland now trails the UK as well. The boasts of ministers have come undone, so the question is how we can kickstart the economy. My party has called for a transformational investment in education and mental health. Investing in people is the best way to enable everyone to achieve their potential, boost productivity and establish a high-wage, high-scale economy for the long term. However, creating new and additional business lending can be part of the solution, too. Vince Cable, as the business secretary, reached the same conclusion way back in 2012 and created the British Business Bank. Benny Higgins has fleshed out the detail and the principles with his implementation plan that he has published quite recently. It identifies the opportunities that come with having a different risk appetite and strategic focus, and it suggests what the initial product range could be. I would like to briefly pick up on a few of the recommendations. Alongside making a return, the bank is set to be closely aligned to the Government, economic and social policy. What will its policy be on assisting companies that do not pay the living wage? We know that healthy employment practices contribute to a healthy economy, and I do not want to see a repeat of the Scottish Enterprise giving Amazon millions of pounds and turning a blind eye to the needs of its workers. Will recommendation 7, calling for a report on the bank's social, environmental and ethical returns, be taken forward? There is also the small matter of how much capital and leverage the bank will attract. It needs to pack a punch and deliver serious investment for the Scottish economy, but with a framework that takes a broader view of what constitutes a worthwhile return. Any bank in possession of hundreds of millions of pounds, whether it is retail or investment, needs to experience people with sound judgment. Recommendation 20 says that the bank will need staff with the right mix of skills and experience. The Government should ensure that the bank can offer employment and remuneration terms that are sufficiently competitive to attract suitably skilled and experienced people. We know that those at the top of the financial sector are accustomed to salaries and bonuses that far exceed the average, but that is not something that people would expect to be replicated in this public sector institution. Lavish salaries are not an option. It would be the responsibility of ministers to strike that balance. I am sure that Parliament would welcome an early indication of how they will get the right people with the banking and investment backgrounds at each level of the organisation and at a cost that the public sector would consider reasonable. I was pleased to see that the expectation that the bank's board and the executive management team are gender balanced. I trust that that will be matched by a gender pay gap of zero. Thanks to the transparency measures introduced by my colleague Joe Swinson, we now know that financial services have some of the biggest differences between the average hourly earnings of women and men. It is as high as 59 per cent at HSBC. There is an opportunity for the Scottish national investment bank to demonstrate leadership on that, and I would like to hear from the minister when he sums up on that matter. Of course, there is a precedent for creating a bank such as this. Benny Higgins counted 90 such institutions around the world. The British Business Bank has been up and running since November 2014, four years ago. 5,382 SMEs in Scotland have received funding via its programmes. 3,063 startups have benefited too. In this implementation plan, Benny Higgins recommends that the bank's activities should be aligned with the activities of the British Business Bank in Scotland, which may require establishing a strategy and alignment between both institutions. The two institutions should be complementary, ensuring that the right mix of support is available. It should also be made clear to businesses north of the border that the existence of a Scottish equivalent will not preclude their accessing finance through the British Business Bank. As Dean Lockhart's amendment notes, the Fraser of Allander Institute has warned that a cluttered policy landscape risks diluting the Scottish Government's economy strategy. It has launched so many programmes and strategies that ministers cannot see the wood for the trees. We cannot afford for time and resources to be expended on creating the bank, only for it to be added to the list of initiatives that have failed to have some kind of impact. At the top of that list is arguably the £500 million growth scheme, the big idea for 2016. The year before the bank was given the same billing, the growth scheme is still to pay out a single penny in loans and guarantees. Equity funding is not new. Why should businesses have any confidence if 20 months later that scheme still is not doing what was said on the tin? Benny Higgins has written the side of the tin for the bank. He has set out the purpose and essential ingredients. Now it is up to ministers to ensure that it provides much-needed stimulus for the Scottish economy. We now move to the open debate. We are a bit pushed for time, so speeches of no more than six minutes please. I call Ivan McKee to be followed by Alexander Burnett. Thank you, Presiding Officer. Before I start, I would just like to remind the chamber of my role as parliamentary liaison officer to the Cabinet Secretary for Economy and I also draw members' attention to my register of interests as a director of the Commonwealth, an organisation that has done significant workplace in the concept of the Scottish National Investment Bank at the centre of the Scottish economic policy debate. National investment banks are an increasingly common phenomenon across the industrial development landscape of many countries, from Germany to our Nordic neighbours and globally including countries in Asia and Latin America. The traditional role of national investment banks has been to support infrastructure spend and to provide counter-cyclical lending as part of a Keynesian interventionist measures. In many countries, however, the role of national investment banks is now wider and focused on the delivery of strategic missions, be those of the development of specific sectors and industries of national importance, fulfilling cross-sectoral objectives such as supporting new technology roll-out or supporting national economic objectives such as driving inclusive growth, supporting internationalisation or improving levels of innovation and competitiveness. Those objectives are embodied in the mission statements of national investment banks and, in this area, I intend to focus my remarks on the limited time that I have available today, considering some potential sector and technology-specific areas of focus for SNIB. The national investment bank model separates the execution and implementation functions from the mission setting or strategic direction process. The former has run to the high standards of professionalism to ensure that funds invested and managed to ensure that rigorous and full risk reward criteria are followed, protecting the significant public investment that is involved. The mission setting process of various directions is set for the bank, and that is where the value is added to the process in terms of how it benefits the national economy. The Scottish National Investment Bank Implementation Plan identifies three broad categories for the focus of the bank, including support for early-stage SME investment, scaling up SME investment and mission-led patient long-term investment. It also identifies the need to address market failure, where the current private sector investment is absent, often as a consequence of differing risk appetite profiles. It is into this area where the need for patient capital intersects with the national strategic economic objectives and direction that the bank can contribute greatly and can deliver its twin objectives of making a return in excess of the cost of capital portfolio level and achieving inclusive and social economic benefits. The implementation plan also recognises the need to ensure investments that are made by the bank act as a catalyst for additional private sector investment and do not act to crowd out private investors. Mission setting, as I have said, is key to the long-term success of SNIB and of how much it can contribute to Scotland's economic growth. It gives us the ability to focus on building specific sectors, tailored to our economy's strengths and opportunities. That includes not only the need to support the creation of new sectors and technologies, but also the creation and shaping of markets for the products and sectors that are generated by those new industries. Scotland has no shortage of sectors where we can leverage strengths, combining industrial capability, brand recognition and academic excellence. It includes life sciences, food and drink, tourism, renewable energy and creative industries to name but a few. Housing and energy are also areas where investment would result in significant benefits in terms of job creation, social benefits and environmental impacts. I would have liked to focus briefly on a sector where I think that the Scottish National Investment Bank would do well to consider, including in its scope, automation and particular autonomous vehicles. That is, I suggest, an ideal candidate to be one of the technologies included in the bank's mission statement. Members will be aware of my interest in this area, having brought self-drive vehicles on several occasions into this chamber, not literally, and it is an area where the opportunity to shape both markets and industries exists. The timing is right, with a ramp-up in self-drive adoption expected to be significant in the next five to ten years. Investment in an industrial hub to support autonomous vehicle technologies, of which several companies are already involved in Scotland, alongside the role of the technology in specific urban and rural settings, would act to generate global interest and act as a magnet for additional private sector investment, one of the key objectives of the Scottish National Investment Bank. The SNIB gives us the opportunity to leap forward in the technology game, and it should be seen as an opportunity to do so, not just to prop up sectors when managed decline is required. The mission statement for a national investment bank is key to success, and it is effectively the embodiment of an industrial strategy. Indeed, it goes full on an industrial strategy as it provides not only the intent but also the mechanism for delivery of the elements of an industrial strategy. Some comments have also been made previously on the cluttered landscape of investment support, notwithstanding the fact that different challenges require different tailored investment solutions at different times, and that having different investment support opportunities available to business can be of benefit to those businesses. The implementation of the Scottish National Investment Bank will have to simplify the current landscape. It will, as the implementation plan makes clear, consolidate several existing investment provisions under one roof. In conclusion, in an environment in which many significant levers of economic control, including those impacting macroeconomic policy, are not under the control of our national parliament. It is essential that we take every opportunity to drive inclusive growth in Scotland. The Scottish National Investment Bank is one such significant step in that direction, building up the Scottish economy, following a model that is well tried and tested internationally, and I look forward to the roll-out of the bank and the benefits that it will bring. Alexander Burnett, followed by Kate Forbes. Thank you, Deputy Presiding Officer. I am grateful to have the opportunity to take part in today's debate on the Scottish National Investment Bank implementation plan. As my colleagues have already touched on, the Scottish Conservatives are supportive of policies and proposals that seek to boost Scotland's small businesses, high streets and our wider economy. Coming from a business background, I know all too well how helpful or not Governments can be in assisting businesses to reach their potential. I am wary of the proposals that are set out by the SNP, but I am keen to ensure that we work together to ensure that our overall goal to help businesses to remain the focus of this conversation. Before I continue, I would like to note members to my register of interest, particularly in relation to businesses that I own and have shares in. On the first view of the plans for the Scottish National Investment Bank, you cannot help but get a sense of deja vu. For it appears that this is a simple rehash and shift of the SNP's other investment agencies to under one roof. The Scottish Investment Bank, the SME holding fund, the Scottish growth scheme, the building Scotland fund and further Scottish investment bank funds. Is this simply a collaboration of the SNP's numerous other investment products? It appears so. When we are at a time when we find ourselves falling behind in productivity, we must ensure that we are not duplicating efforts. That is why today my colleagues and I are asking for some clarity on how this investment bank will operate and how it will fit within an enterprise landscape that is already overcrowded. Perhaps the SNP will admit themselves that the Scottish National Investment Bank is a duplication, for they mention it in their own implementation plan, but it remains an option to simply increase funding for the Scottish Investment Bank. For a more specific example, Scottish National Investment Bank proposals seek to fill the gap in the market for financing SMEs of up to £10 million, but the Scottish Investment Bank already does that, and this is stated in the implementation plan. We need to focus on matching the UK's growth rates, and instead of looking for the next press headline, we must start focusing on the long-term policies that can really benefit our businesses, because the SNP's lack of focus is having an impact. Today's papers show that the SNP have missed plans to match the UK GDP, that they have missed plans to match even small EU countries' GDP, that they have failed to increase productivity, that they have failed to increase exports and that they have failed to increase research and development. In total, Scotland has cost more than £80 billion during its time in charge. Keith Brown Can I thank the member for taking intervention on Mibrius? Would he recognise that the last figures for GDP for Scotland are, as Jackie Baillie said, 0.3 per cent? The last figures for the UK Government are 0.1 per cent. Does he acknowledge, as his front bench won't, that the UK Government is an active player in the Scottish economy? Alexander Burnett I think that if you ask any business in Scotland who's been in charge and who's been affecting their business most of the last 10 years, I think that you'll find well to talk about the SNP and the Scottish Government. As my colleagues have also mentioned, the Fraser of Allander Institute has also criticised the SNP's cluttered landscape and said that it has lost clarity of focus, which is hurting economic growth. We've cluttered the landscape so much that Nicola Sturgeon's own staff had to ask which investment bank a freedom of information request was referring to when asked. So, if the SNP doesn't have clarity over what is happening, how can it expect businesses to? I do worry that with this comes a failure to deliver. For this is not the first time that the SNP Government has announced a promise to invest in our business community with no follow-through. The Scottish growth scheme has failed to deliver a single penny of loans and guarantees after 18 months into a three-year scheme, despite being the original reason for it being established. This is no surprise when only £25 million has been allocated, even though it was supposed to be a £500 million three-year plan. This is only one example of the many broken promises by the SNP. However, I want to reiterate that the Scottish Conservatives are supportive of measures that begin to fix our poor economic record. Coming from a business background, I have seen the benefit that the Governments are able to bring to the business world through policy. Deputy Presiding Officer, the Scottish Conservatives want to see businesses thrive as we know that this benefits workers, which in turn benefits our communities. We fully support the intent behind the Scottish National Investment Bank, knowing that that will help to address challenges and boost the Scottish economy. Today, I ask what difference does the SNP envisage this making to the development of businesses in the north-east. I join my colleagues in their call for further clarity on the details of their proposal to ensure that we do not face a simple rehash of other organisations. I call Kate Forbes, who is followed by Claudia Beamish. I should also note that I am the PLO for the Cabinet Secretary for Finance. Having not had as long to wait as Jackie Baillie has for the National Investment Bank, I think that it is a great idea. I get the impression that most people across the chamber agree with me as well. We often have the sense that, when it comes to innovation, it is best left in the hands of private investors and that politicians should keep to the day job of policy and that, if we really want to see long-term innovation, it will be driven by the Mark Zuckerbergs and the Steve Jobs of this world. If we look back over the last century in particular, we see that some of the biggest breakthroughs in technology and innovation has been pioneered by the state. That is usually because whether innovation will be a success or not is usually very uncertain and takes longer than the traditional banks or the venture capitalists are willing to wait. In countries that are very small, whether it is Singapore or countries that are very big, such as the USA and China, it is often dreaming the state that has provided the kind of patient and long-term finance that new technologies need to get off the ground. That has often been driven by big missions, which is a word that comes up quite a lot in the implementation plan. Big missions of solving climate change are putting a human being on the moon. It is not just required funding basic research, but it has also been a case of applying that research. Again, we see it with something like Apple, where, in the early stages, Government provided the necessary cash support in order to grow business. Now, every time we use an iPhone, we can thank a state that was once invested in technology like that. I suggest, too, that examples on a much smaller scale are found within our own country on a totally different scale. With far more of a social and economic purpose, the way that Highlands and Islands Enterprise has been able to target investment and funding and achieve its social and economic aims of turning around de-population and building up the economy. We all seem to be looking for quick fixes to economic growth. The Tories are largely concerned with the blame game at the moment as to whose fault those figures are. Once I might argue cynically that that is to divert attention, but I will not go down that route. Yes, oh, two at the same time. Ladies first. Gillian Martin. I am very grateful to Kate Forbes for taking me into mention. Would she agree that, when it comes to the Highlands and Islands, the loss of European structural funds is making that even more pressing that there is another avenue to get funds into Scotland? Miss Martin, could you speak into your microphone so that we can hear you please? Would Kate Forbes agree with me that, given that the European structural funds are about to be removed as a result of Brexit, that this is ever more pressing? Kate Forbes. I agreed with her the first time and I agree with you even more the second time. It is true. Again, that is an example. To the point that has been made about the cluttered landscape, it is a genuine question because, with the creation of any new body, any new public body, there has got to be a streamlined strategy with every public body knowing what its primary purpose is and ensuring that there is no duplication. I think that it will be deeply unfortunate when European structural funds are removed. Talking about economic growth in particular, I look at it through the lens of population productivity and participation. If we look at the potential for an investment bank on all three fronts with population, we really want entrepreneurs to move to Scotland. We want them to bring their ideas here, to choose to set up business here and then to expand their ideas and employ a workforce that will directly go to attracting more people to move to Scotland. We then want to improve our productivity. That can be done fairly straightforwardly using technology and innovation. Again, if the investment bank is targeted at innovation and high-tech startups or expansion, it will go towards improving our productivity. Lastly, participation. We talk a lot about inclusivity so that nobody is left behind, so that our employment rates are as high as they can be. Regional inclusivity, too. When I look again at the three growth sectors in Scotland, such as food and drink, the renewables industry and tourism, none of them would be doing as well as they are doing without my own constituency and region of the Highlands, because, as much as people want to come and see Glasgow, I would argue that they are largely on their way to the Highlands. When it comes to food and drink, you see so many small businesses, small SMEs in places such as the Highlands and Islands, who do not have access to the funds to enable them to grow because commercial lending has not been accessible to them. Although, yes, there is a place for advice, expertise and support, at the end of the day, in order to grow, they need access to finance. It is not just finance to do them for the next year or three years, which is largely what commercial lending will provide. It is actually the finance that will take a risk on them and support them for the next 15 years. I want to take the short time that I have to explore the important development of the Scottish National Investment Bank, put forward some of the criteria and others that are important for consideration and highlight some of the range of businesses, organisations and public bodies that, I believe, should be considered for inclusion in those who can apply for funds. We must ask ourselves what sort of an economy, society and environment we want to support. The recommendation of the report for a balanced scorecard approach being required that reports on the financial performance as well as on the economic impact over time, including social, environmental and ethical returns, is indeed welcome. The environment link submission stresses the necessity of taking into account the UN's sustainable development goals as well. Clear eligibility criteria for SNIB will be essential. I welcome the cabinet secretary's announcements today. I suggest that one of the eligibility criteria could be that whoever applies must be a living wage employer. For example, one example of such a company is in my region Tempris Brewery, which is small, thriving and growing. The tired old argument that a firm is too small is not acceptable. As we shift to the low carbon economy as well, the SNIB must provide an opportunity to develop in this direction. The Herald leader of the 3 May states that the think-time or catapult says that thousands of jobs could be created if major new projects get the go-ahead. The benefits will not appear from nowhere. The Scottish Government has to provide a power boost of its own investment in the business and technologies that could make that happen. The SNIB can make a significant contribution here, but only if robustly linked to a real industrial strategy. The STUC in its briefing pulls sharp focus on the just transition partnership and states that the STUC would urge the Scottish Government to incorporate just transition principles in the remit. The STUC has played an active role in the just transition partnership and is keen to see the new just transition commission have a powerful role remit in representation for work, ensuring that the transformation to the low carbon economy is carried out fairly, supporting those communities and workers where industries and jobs must change and investing in retraining and measures to tackle disadvantage in the labour market. Regionality should also be considered as a fundamental criteria to ensure that all Scotland benefits from the new public bank, whether the Highlands as Cape Forbes has highlighted or in my own region of South Scotland. Dumfries and Galloway figures put the need to support smaller and local enterprises in rural Scotland into stark perspective. Here, of the 6,000 businesses registered, 90 per cent have 10 employees or fewer. How can it be that those who have the potential to expand have not always been properly supported, frankly, through the business gateway? There is now an opportunity to link the new South Scotland enterprise agency with the criteria and pathways to the SNIB. One such company is Macriber, an innovative firm that is in the vanguard of the circular economy, making road surfaces out of recycled plastic. It is remote, rural and growing and needs support, like many others. Another eligibility criteria must surely be the consideration of inclusive ownership models, municipal, public, community and co-operative as well. The SNIB should, in my view, have as part of its remit supporting the expansion of co-operative, mutual and social enterprise sectors through the provision of patient capital. The role of the Cooperative Development Scotland organisation could be enhanced so that it operates as a champion of the co-operative and mutual sector and feeds into the SNIB. There could even be an annual report of investment in the co-operative sector. Support for businesses that put money back into the local economy should be a priority. Despite the social, co-operative and SME sectors crucial role in the economy, they face a number of barriers to growth through difficulty in getting investment from high street lenders and the high cross of credit. The SNIB can and must, in my view, be a strong focus, which helps those who experience these barriers. A further way that can give support—I want to highlight that briefly, but it would certainly relieve unnecessary stress—is through support for charities who do not have significant bank reserves, such as the Lanark Development Trust, which received a grant offer from the leader. That was to be paid retrospectively. It was not able to take the loan, because a local business stepped in, but that is not always the case. The SNIB could perhaps support short-term loans at very low rates, which I am sure would help a lot of charitable groups. For many types of enterprises, I and others have highlighted that there is, of course, the necessity of patient capital, and that is absolutely imperative. However, for it to succeed over many years, it is essential that, while there will be a greater degree of risk and greater forbearance, there must also be specific criteria for recognising where loans are non-performing and a clear work-out programme. A careful assessment of that will be essential so that and appropriate management will prevent stagnation and enable continuing opportunity. Finally, back to the STUC submission. The mission statement must be amended in their view to read that the Scottish National Investment Bank is to provide and catalise investment in order to create opportunities for Scotland by powering innovation and accelerating the just transition transformation to a low-carbon, high-tech, connected, globally competitive and inclusive economy, which puts people and fair work at its heart. I ask the Scottish Government to carefully consider that. Thank you, Presiding Officer. Last year, at my party's conference, the First Minister, Nicola Sturgeon, made the announcement that our Government would create a Scottish National Investment Bank. The announcement got a standing ovation. I was sat next to one of the ministers tasked with delivering it, from Mr Real House's Remembers. The importance of what it means to people was obvious from the response that we witnessed. A national bank supporting Scottish businesses and their economy is a real chance to do things differently. I want to use my time today to put my views on record of the different approaches this bank could have and what I see are the opportunities to unlock latent potential and nurture new and existing business. You will notice that I say nurture rather than just grow in my use of language is no accident. As convener of the cross-party group of women and enterprise and someone who tries to represent many views of women-led businesses in every debate in the economy in this chamber, my taking this will come as no surprise. In the two years that I have convened the group, we have had two complete sessions on access to finance, and I do not see the topic being sidelined in our work programme any time soon. I am very glad to hear Willie Rennie concentrate on women's issues in his speech, but I note that any of the Lib Dems have come along to the CPG, so I would like to formally extend an invitation for someone to represent them. In Scotland, women-led businesses represent 50 per cent of businesses receiving start-up support that are owned by women, yet only 20 per cent of women-led businesses are making it into the growth pipeline, and only 5 per cent of Scottish Enterprise account managed businesses are run by women. One of the reasons for that is the finance gap. The joint submission to the consultation by women's enterprise Scotland in gender closed the gap and the Scottish women's budget group has a number of key asks of the Scottish National Investment Bank, and I would like to summarise them. They say that the principle of equality and non-discrimination should be at the bank's core. Investment in infrastructure should not just be a bit bricks, steel and fibre optic cable. Child care has the same economic impact and should be considered as infrastructure worthy of investment. The investment bank should help fund research and development that creates jobs and technologies equally targeted at both genders. Women's businesses should stop being undercapitalised, and a rebalancing of finance and nurturing women-led businesses could be an injection of over £7.6 billion into the Scottish economy. The bank should be governed by a gender-balanced, gender-competent leadership team. It should gather gender-disaggregated data, and its client offers should be gender sensitive, with all personnel involved in managing finance offers to be trained to be gender sensitive, and eliminate unconscious bias out of the decision making process. I agree with all those points. I want to use this opportunity to put on record my call to see women being regarded as an economic growth sector in their own right, and I would like to see the Scottish National Investment Bank having women's enterprise recognised as a key area for financial support. Another key focus should be on the creation of new markets, as has been mentioned by a few people already. Most obviously, renewable energy, which would demand patient capital to develop technologies for the future, which would overtake fossil fuel and lay down a pathway for engineering skills to transfer between the two energy sectors. Of course, as I mentioned in my intervention to Kate Forbes, the loss of European structural funding, we have a pressing need to fund innovation, but that requires a long-term commitment and an expectation that returns will not be immediate. For example, I would like to see finance being offered to allow existing companies to explore new markets. For example, oil and gas service companies will be able to take out finance, to invest in restructuring and retraining to access renewable energy contracts, and perhaps to work with universities to create groundbreaking technology, which we can drive our economy forward and export throughout the world. In my area of the north-east, there is a pressing need for diversification and innovation in order to make the area workforce less vulnerable to market changes and to retain talent in a geographical area. Many consultation respondents have made mention of regional targeting. This could be businesses wishing to operate in areas of Scotland that have a pressing need for investment, jobs or are facing an economic shock could qualify for long-term patient capital support in order to bolster economic activity and make those areas attractive to new investors. Many submissions have also made a case for infrastructure investment in regions facing economic issues. I also think that the access to finance that the SNIB provides can bolster the efficacy of the Scottish business pledge. Access to their finance could be dependent on the applicant company signing up to and demonstrating compliance with the key areas of the fair work agendas on the pledge. Many of the discussions that we have had both in the economy committee and the cross-party group and women's enterprise have centred around the possibility of the Scottish national investment bank also potentially filling in the gap in the market that used to be offered by high street banks, particularly with regard to small and medium-sized enterprises. There is a real opportunity to address the market failures in lending, particularly in the post banking crisis, which is arguably limiting the growth of our SMEs. Sub £1 million loans could potentially have a great impact, particularly when it comes to enabling SMEs to service large contracts, which would also allow them to grow and internationalise. The SME base, arguably, has the most potential for growth. Finally, I want to end on one significant aspect of the Scottish National Investment Bank. That is that it will not be working for shareholders, but it is working for its stakeholders, and that is the people of Scotland. That is the main reason why people got to their feet that day when the First Minister announced its creation. Gordon Lindhurst, followed by Richard Lyle. The urgent need for business support has been spelled out when the Government's own analysis showed that SMEs in this country need up to £750 million more funding per year. But what is important are the resources themselves that support businesses and the economy rather than endless initiatives, agencies and bodies that are set up to essentially do very similar things, because the creation of the Scottish National Investment Bank will incur running costs of between £20 million and £30 million per annum. While those figures are broadly comparable to banks of a similar nature, we need to remember the cluttered landscape of support that already exists in Scotland, such as the Scottish growth scheme that has paid out just 5 per cent of the funding that was promised two thirds of the way into its three-year plan. The lack of clarity of focus, which the Fraser of Allander Institute pointed to in March, signifies that this SNP Government is struggling to find the answers to its own difficult economic questions. Annual running costs that arise through duplication will simply eat into resources for business support. In recent weeks, the Economy, Jobs and Fair Work Committee has been taking evidence on the performance of the Scottish economy, and that has included discussions about the proposals for the Scottish National Investment Bank. Scottish Government adviser Jim McCall talked to us through a useful example of a bid that he was involved in that would have built vessels for Irish ferries. Had a Scottish Government guarantee been provided for that project, it would have taken up much of the £340 million earmarked for the first few years of the bank. With the Scottish Government's track record in delivering funding that has been promised in other schemes, we need clarity as to how the bank will fit into the enterprise landscape, deliver support and not waste money. Derek Mackay I know the name, but it was just the mic that was not coming on quickly enough. Mr Lindhurst, thank you for taking the intervention. Is the member not aware that export guarantees are actually delivered by the UK Government, and maybe some pressure should be directed there to give a level playing field for shipbuilding industry, and indeed many others, where the UK Government is taking their eye off the ball as they mismanage the Brexit chaos? Gordon Lindhurst On that point, we have the UK industrial strategy, which has the answer, but coming back to the Scottish situation, the point is what the cabinet secretary himself alluded to, how those things are done in other countries such as Germany, where a plan is set out, it is properly thought through and then it is actually delivered. That is what we are not seeing in Scotland, unfortunately, under this Government. Witnesses attending our committee have told of the problem of the vacuum that exists when it comes to export finance, for example, and especially since the banking crash. They need to have government-backed patient capital that does not seek the quick wins that what has now become perhaps traditional bank lending does, but it has the potential to open up support to more businesses. That is to be welcomed. The implementation plan also points to the bank being used as a vehicle to pursue transformative change, such as supporting efforts to tackle climate change. This following example, such as the German KFW, which issues support that reflects its three megatrends or grand challenges, one of which is climate change. However, what the Government should be wary of is not to mirror some of the inflexibility that businesses have identified with the enterprise agencies. The bank should first and foremost be a support system in general that helps responsible companies to access patient capital. In choosing where to invest, the SNIB and other sources of funding should analyse in detail how its support can contribute to business creation and growth, where there is real potential with other factors, environmental policies, workforce practices and so on, supplementing that decision making. Analyzing where investment should be driven should be done innovatively and dynamically, not just by a rigid checklist of business pledges that tie the hands of companies that are already doing the right things. A Government ownership model may be the way to ensure patient capital, but the bank should be operated and decisions made by those with the experience needed. To quote Jim McCall again, you do not want it to be managed by civil servants. Providing a structure but allowing decision making to take place independent of Government is key to addressing some of the concerns about how the SNIB may be seen. Some political commentators have argued that the new bank and the amalgamation of existing schemes into it is a way of increasing political control over previously independent agencies. Owen Kelly, former head of Scottish financial enterprise, warned that the structure proposed is effectively part of Government, wholly owned by ministers and pursuing missions chosen by them, his words. Deputy Presiding Officer, today's debate has allowed us to delve into some of the detail and to analyse where the bank should fit within the wider enterprise landscape and the role of Government. It is simply unacceptable that SNP economic incompetence is costing Scotland in areas such as GDP growth, productivity, exports and research and development to the tune of more than £80 billion of missed targets. Hopefully ministers will today listen to some of the concerns voiced here and also those whose experience could and can contribute towards the bank's potential for success. Richard Lyle, followed by James Kelly. Thank you, Presiding Officer. Do you know, Mr Lindhurst, that through you, Presiding Officer, you should look at your own party's incompetence. Ambition, Presiding Officer. Ambition. That's the word that jumps to the floor as we debate this issue in the chamber today. Ambition for Scotland, ambition for its economy and ambition for its people. I will welcome the publication of the Scottish National Investment Bank Implementation Plan, as I consider it to be yet another milestone in our journey of delivering the environment to help Scotland to achieve its full economic potential. On that journey to realise our ambitions for Scotland's economy, we must ensure that innovative companies are supported to get access to strategic, affordable finance to grow and thrive, all of while ensuring the business environment, encouraging our young people to be entrepreneurs of not only the future, but right now. Not only will it help to deliver those ambitions, but it will aim to provide and stimulate investment in order to create opportunities for Scotland. By powering innovation and accelerating transformation to a low-carbon, high-tech, global, competitive and importantly inclusive economy. I want to reflect more on the potential that the National Investment Bank has to support innovation and new enterprise, because it is an important area with many opportunities. For me, it singles a real opportunity to help potential new businesses who wish to bring new inventions and innovation to the fore. Innovation that is not getting the support that is needed from traditional banks. I say that of course as a former employee of a well-known Scottish bank. Unlike that bank, I want this bank to listen and to lend. Examples of innovation that I see as having the potential to be supported by the National Investment Bank are ones that will help to deliver for our communities. I know of one organisation that wishes to bring new innovation and renewable energy, which will help local authorities to reduce their power costs and contribute to their national grid. Do you know what? They cannot secure bank funding, which totally astounds me. Examples such as these are the tip of the iceberg of the potential opportunities that are presented by a national investment bank. Of course, a national investment bank marks a step change. It recognises the work done so far by the SNP Government to support business with growth potential and innovation. It is important and significant that we must go further. Our Scottish National Investment Bank has to take a new approach on capital investment. It must be innovative, supportive and lend. The commitment on the bank, which is part of the programme for government 2017-18, has been informed on part of the advice from the Council of Economic Advisers, the CEA. They have highlighted the important role that national investment banks play in providing long-term investment to support economic growth in many European countries, including recognising that there is a significant constraint faced by many businesses with growth potential and access to long-term patent capital. As I have said already, whereas the Scottish Government has already taken steps to improve access to finance through, for example, the establishment of the Scottish growth scheme, there is more to be done. If we wish to succeed in raising our potential, our ambition and address the challenge, that is why now is the time to take a new approach on capital investment. I believe that there is a strong consensus in the timing being right, Presiding Officer. A genuine shared belief that there is an immediate pressing need for a creation of the bank. Already it has been stated that it is clear that economic and social wellbeing of our country will be enhanced by an institution that complements private sector investment with a clear focus on SMEs and projects that require strategic patent capital. CEO of Tesco Bank, Benny Higgins, led the work on the development of the bank's governance and remit through his team, have undertaken rigorous analysis through the process and engaged in extensive and broad group of individuals and bodies in both public and private sectors. In order to inform this work, the University College London Institute of Innovation and Public Purpose was commissioned to produce a comprehensive report on all financing activities across the selection of international state investment banks, including Finland and Germany. The work undertaken by other nations across the continent should serve as an example of the potential that our bank has to generate and deliver a real chance to fulfil the potential for Scotland's economy. Worse, it is right that this debate naturally focuses square learner plans for a national investment bank. I wish to end my remarks today, Presiding Officer, by recognising that those plans are one strand of our ambition for Scotland's economy and people. As we have seen through 2018-19 budget, the SNP Government is delivering significant investment for the Scottish economy by allocating additional spending in economy, jobs and fair work portfolio. From establishing a building in Scotland fund to ambitious plans to deliver superfast broadband and so on, I could go on, but unfortunately the Tory's always do is down. The Scottish Government, the SNP Government has recognised that we can continue to unlock Scotland's potential by investing in those that have a potential to grow and recognise the contribution that we have made. I think that those plans are ambitious, essential and I commend them and I commend the work by the cabinet secretary and his ministers. I say to all the remaining speakers that time is tight. If people do not, as Mr Loud has said, stick to just under six minutes, I will have to cut the last speeches. That will be James Kelly to be followed by Gordon MacDonald. Thank you, Presiding Officer. Members across the chamber are right to talk about the benefits of a Scottish national investment bank and welcome the cabinet secretary's announcement today. However, Jackie Baillie is also correct to say that this is the ninth time that we have had such an announcement and progress has indeed been slow. Unless we listen carefully to the cabinet secretary, he tells us that it will be 2019 before we have the bill that launches the Scottish national investment bank. The reality is that we are all likely to be back here sometime next year for the Government's very own version of 10 in a row. There can be no doubt that that would give Murdo Fraser an opportunity to cheer on a 10 in a row. Derek Mackay I think that it's best to move it on from football, Presiding Officer. Can I ask, then, on the chances of Labour seeing through their economic strategy? That requires the election, as I understand it, of Jeremy Corbyn to be Prime Minister. What year have Labour scheduled that in as part of your economic strategy? James Kelly We would welcome an election as soon as possible, Mr Mackay. As Jackie Baillie is very competently outlined in her opening speech, that would deliver £40 billion of investment for a Scottish national investment bank. That is something that the SNP should be hoping to see happen as well as Scottish Labour. However, there is no doubt that there is very much a place for a Scottish national investment bank. It is not just the growth figures that people have spoken about—about 0.3 per cent growth in the last quarter in Scotland compared with 1.1 per cent in the UK, which should be a concern to all of us. Just look at the examples of some of the local jobs crisis that we have seen across Scotland—Bifab in Fife, Young's Down in Dumfries and Two Sisters in Canvas Lang. Those jobs crisis are crying out for a Scottish national investment bank. In Canvas Lang, the closure of the Two Sisters plant will result in the loss of 450 jobs. It is a real hammer blow for the local area. What is needed there is not just words and sympathy for the workforce but practical action. That is something that a national investment bank could help to support. People are also right to talk about the capitalisation and the importance of the amount of money that is required. I mean £340 million, although welcome, I do not think that it really goes far enough. I think that there is a major job for the Government as it develops to look at how more capital can be brought forward if we are really going to seize on the economic opportunities that many in the chamber have spoken about throughout the debate. I also think that it has to tie in properly to a coherent economic policy. Many have spoken about the cluttered economic policy landscape. The Fraser of Allander Institute analysis shows that the Government has got 17 different strategies relating to the economy. That demonstrates the actions of a Government that like to talk and bring groups together—lots of meaningful words—but there is a lack of real action to move things forward. You can see that in the example of the growth scheme, where only 31 businesses have received help. What is also needed is to tie it in to a proper industrial strategy. Kate Forbes rightly spoke about the importance of innovation. We heard last week from Sir Jim Macdonald of Strathclyde University on the chronic shortage of engineering skills. We are short of 400,000 engineers throughout the UK, but we know that there is also a quite sizable shortage in Scotland. Part of the problem is that, as the Government acknowledges, there are not enough teachers in STEM subjects. There is a lack of a thought-out policy from schools through to colleges and universities and into the actual workplace, as to how we are going to move people through and produce more graduates that will fill those skilled shortages. We all welcome the proposals for a Scottish national investment bank, but it is time to get a move on with that. It is also time to look at how we can pull more money into it and tie it into a proper economic policy with an industrial strategy that has fairness and growth at the heart of it. Of those strands are included, there is a real opportunity for the Scottish economy. I welcome the proposal to establish a Scottish national investment bank with a focus to provide long-term finance to support growth in the economy. A publicly-owned national investment bank will act as a cornerstone for the economy, with a capitalisation over the first 10 years of £2 billion. It will focus on Scotland's economic priorities, as well as promoting inclusive growth. Scotland needs that additional support, as recent economic data has highlighted to slow down across all the UK economy as a result of Brexit and the Conservative Government austerity measures impacting on Government and household expenditure. We can see the evidence of this with the UK quarterly growth rate in the first quarter of this year collapsing to 0.1 per cent and GDP per head falling by 0.1 per cent over the same quarter. The OECD estimated that the UK economy will grow this year at a slower pace than any other major advanced or emerging nation. One reason for the poor growth is household spending, which has long been one of the drivers of the UK economy, with retail sales accounting for as much as 30 per cent of domestic spending. Consumers are seeing their spending power drop as the slump and sterling follow Brexit referendum in 2016 has pushed up food prices with rising inflation and a decline in wage growth over recent years, resulting in many families struggling to make ends meet. In addition, the Chamber of Commerce has highlighted that until a transitional Brexit deal is in place, companies will not increase spending due to uncertainty and that that is impacting on staffing levels and production capacity. The TUC, in a submission on the case for national investment bank, highlighted that companies will not invest due to uncertainty about the strength of the economy going forwards, exacerbated by austerity policies, shareholder short-termism and the uncertainty around Brexit are undoubtedly all playing a part. In 2016, the only OECD countries investing less than the UK were Greece and Portugal, with Ireland investing as a percentage of GDP double the UK investment level. The patient capital review commissioned by the UK Government highlighted that there are clear barriers in accessing long-term patient capital in the UK and that the majority of financing is concentrated in London and therefore it is particularly difficult for businesses outside the capital to access the funding that they require. The Scottish national investment bank will help to alleviate this situation by providing patient capital over a 10 to 15-year period to support companies to grow. The long-term approach is important because the vast majority of companies in Scotland are SMEs with less than five employees. One of the key growth areas for Scotland is the new tech companies being set up, with 440 software development and programming businesses being incorporated in 2017 and a 77 per cent increase on the 249 companies set up in 2016. A Scottish national investment bank provides support to our growth sectors such as Fintech, Life Sciences, Aerospace and Renewables. Will he agree with the Scottish Life Sciences Association about its strong concerns that Scotland is now the highest tax part of the UK and that that will impact the ability of its member companies, life science companies, to attract the right talent to Scotland? I think that if any reasonable person looked at the whole policies across the gamut, whether it is free prescription, free tuition or everything, they would see that Scotland in the round is one of the lowest-taxed parts of the UK. Audit Scotland highlighted in its report into supporting Scotland's economic growth outlines the benefits. A buoyant economy creates employment opportunities. That increases people's wealth, leads to higher spending and stimulates demand for goods and service. That in turn means that businesses need to produce more, creating further employment opportunities, increased individual and business wealth also creates more money for public services such as healthcare and education, all of which leads to a higher quality of life for the people of Scotland. Growth will result in the Scottish National Investment Bank becoming self-sustaining in the long term, raising its own capital and being positioned to provide long-term patient finance for both smaller firms and larger projects, creating the opportunities for new markets for the private sector to invest in. Am I getting my time back for intervention? No, right, okay, I'll miss a bit then. If we are to emulate the successful investment banks elsewhere, then in order to operate the bank will require flexibility to hold reserves and carry these over between financial years outwith existing limits set for the Scottish Government. As the implementation plan highlights, HM Treasury has already granted a similar dispensation to the green investment bank prior to its recent privatisation and to the British business bank. In addition, a similar arrangement is in place for Scottish housing associations on a temporary basis while they are currently classified to the public sector. As the report states, without such dispensation, the bank would be unable to deliver the scale and ambition that is set out for it here, including through the adoption of a long-term patient investment strategy. Scotland needs a national investment bank, and all political parties should get behind this proposal to deliver for Scottish companies. The last two contributions in the open debate are Tom Mason to be followed by John Mason. I remind the chamber that I remain in the city of Aberdeen, councillor. Let me begin by acknowledging the announcement of the Scottish National Investment Bank. Just as I acknowledged its announcement in 2009, its re-announcements in 2013 and 2015, and the announcement and subsequent failure of the 2016 Scottish growth scheme. Presiding Officer, I look forward to the bank's next announcement in six months' time. Those who know me know that I was involved for some 20 years with the MBA programme at Aberdeen Business School of Robert Gordon University. As you might know, many of the students who entered the MBA program do so with the ambition to start their own business. To that end, I took part in negotiations many a time with various Government agencies who were supportive of enterprise. Two things still stand out from these dialogues. Firstly, when looking to consult the Government for help, students were inundated with so many barriers that have prevented their ideas from coming to fruition. You must remember that starting a business is an act of faith and not a rationality, as 95 per cent of new businesses will fail. Secondly, on a number of occasions, I attended relevant seminars. Each time, the measure of success was a number of new businesses created in any one year, with no target of sustainability. Good business requires a favourable environment, an attitude that continually supports and endorses the many acts of faith that new enterprises require. No matter how much rational business support is provided, if this environment is not available, new businesses will not be created or sustained. So what has this got to do with the proposed Scottish National Investment Bank? Well, as I considered, it has, of course, endorsed sensible long-term investment in our economy. However, there has to be a degree of purpose to investments. I feel that the bank will not yet be yet another big-money facade for the Government to hide behind. I suspect that the current barriers to successful entrepreneurial activity are only partially due to financial availability and more primarily to do with a negative business environment that pervades Scotland. If the Government has spent more time getting out of the way of businesses, allowing independence and prosperity in the business community, it might see more positive aspirations from a greater number of people. What's more, I'm not convinced that the Government will deliver on this proposal. The proposed £500 million Scottish gross scheme is yet to allocate a single penny in loans or guarantees. I think that this can universally be seen as a failure. The bank will reportedly fill the gap in the SME market, providing finance up to £10 million in each firm. It will expand loan finances to SMEs between £100,000 and £2 million. It will increase microfinance up to £100,000. All those are already available through various other schemes. Even the bank's own implementation plan admitted that increasing funding for the Scottish investment bank could render this new plan unnecessary, a concerning conclusion. It is only added to the fact that the idea of the bank came from a pro-independence think tank. I am incidentally hesitant. If there's one thing that we know about the wider yes movement, it's that they are experts in exploring blame from SNP on to anything that sticks to it. For example, the think tank suggested by the bank was needed due to the failure of our private financial sector, maybe instead of blaming our businesses, which should instead look at Government who controls and restricts out their environment. On this basis, we should streamline the Government's role in an economy. If funding is yet another crangled task with the same duties held by others, sounds irresponsible. Instead, let's start by reverting the tax decisions taken at the latest budget by encouraging businesses to start up and grow in Scotland. As play to our strengths by encouraging consumption, we need to grow the economy, not tax it. I know my words fall on deaf ears. Sensible long-term funding is not the interest of the current Scottish Government. From public pay policy to capital borrowing decisions to the Cabinet Secretary for Finance after multiple parliamentary questions, admitted that the important future planning decisions are only taking on a year-by-year basis. We are getting a new investment bank with no attempt to plan for the future and every attempt to spend it in the present. What a way to run a Government, what a way to run an economy and what a way to run a country? The last of the open debate contributions is from John Mason. I think that there's clearly a range of issues in this debate that it seems we can all pretty well agree on. I'm looking through their recommendations. I sense agreement, for example, on number one, the very fact that a bank should be established. Two, it should help address Scotland's economic priorities in an inclusive and ethical way. Five, it should focus on being additional to finance that is already provided and complement rather than crowd out. Nine, it should build on current skills and experience. Seventeen, it should be the highest standards of transparency, accountability and risk management to mention but a few. It's good that there is a lot that we can agree on. Clearly, there will be areas in which we differ in this chamber and where folk outside will differ as well. The very long-term patient finance is an interesting one. The market is not usually patient and many individuals are not very patient either. Many of us admire what is apparently the German model of investors and local banks being committed for the longer term and prepared to take the downs along with the ups. Particularly, I admire the concept where shareholders are patient when a takeover of a company is suggested and they say that they are willing to wait longer for a return rather than sell out immediately for a short-term profit. In this Parliament, too, patients are not always evident. What was it used to say about patients? Sell them found in women, never in a man. People are waiting too long at A and E, attainment gap has not been closed quickly enough, exports are not growing fast enough. We say that we want preventative spend to solve tomorrow's problems, but, in practice, we demand reactive spend to solve today's. I wonder how we as politicians are going to cope with the concept of being more patient. If the new bank does not bring returns quickly enough and recommendation 6 says that measurement should be over at least a 10 to 15-year horizon, are Opposition members committing to wait that long before they decide if a project has been successful or not? So one of my fears is that this bank could be undermined by its critics taking too short term of view. And actually, I wonder if 10 to 15 years is long term enough. That is really quite short term when you think of a house mortgage being 25 years and the actual life of the house might be at least double that. Recommendation 10 refers to aligning activities and members have already mentioned the British Business Bank. That is fine. I think that we have heard some evidence at the economy committee that some Scottish businesses are not aware of the British Business Bank and that it is available to help them here in Scotland. So there is clearly a bit of work to do in getting information to people. Recommendation 11 says that the bank should be a public body and should have maximum flexibility in how it invests, fair enough. The point is also made that it will not require a banking licence as it will not be a deposit-taking institution. I wonder if that is something that can be considered a bit more. Andy Wightman was touching on that. Just on Friday, I attended a funeral and was asked by somebody if they would be able to invest in the SNIB as they would be prepared to take a longer term view and potentially a lower return on their investment if they felt that it was going to benefit Scotland's economy. I think that there may well be an appetite amongst the public for individuals investing in this kind of way, and I wonder if some vehicle can be found to allow that to happen. Recommendation 20 talks about staff with the right mix of schools and experience and also says remuneration terms that are sufficiently competitive. I wonder how that fits with Recommendation 17 talking about the highest standards of transparency and Recommendation 2 that we must act in an inclusive and ethical way. Can there and will there be a limit, for example, in the ratio between the top and the bottom paid staff within the bank? Does transparency mean that every salary level and every bonus will be published as they would be in most public sector bodies? Sticking to the ethical word, I wonder how easy it is going to be to agree on what is ethical and what is not. I might think that investing in oil and gas is ethical, but my green colleagues over there might not. I might be happy that we continue farming and exporting salmon and cattle while others might consider that unethical, and I think that that could be a tricky area for us all to agree on. On more specifically economic issues, too, I wonder if there would be pressure to bail out struggling companies if the public and others know that there is a pot of money sitting there—James Kerley touched on that. For example, would Prestwick Airport receive investment? Would we expect to get that money back? Would the bank really be able to make its own decisions on that if there was pressure from the public and opposition MSPs? I note also the briefing from friends of the earth, and thanks to them for that, calling for example of investment for walking and cycling infrastructure, and I do wonder if that is the kind of thing that the bank would actually do. How could it ever get a repayment or interest on something like that, unless it is extra lending to a local authority, but local authorities are bound by prudential borrowing as to how much they can borrow? In conclusion, I add my voice to those supporting this excellent concept of a Scottish national investment bank. Sure, there are some questions that need to be addressed, but overall I can say that I am enthusiastic about the idea and I look forward to it all being fleshed out in the months to come. We move to the closing speeches. I call Andy Wightman for up to six minutes, please. Thank you very much, Presiding Officer. As with some debates here, this has been a broadly consensual debate, although politics has made its usual interventions now and again. We agree that everyone has agreed so far that the idea of a Scottish national investment bank is a good idea, but we are all agreed that a lot of work remains to be done to make it happen and for it to be effective. I agree with Dean Lockhart that there are some areas that demand greater clarity in relationship to the cluttered landscape. I think that there is work for us all ahead to ensure that what Alex Burnett referred to as not being just an umbrella body for existing initiatives. I share some of that skepticism, but I am prepared to give, at the moment anyway, the Government the benefit of the doubt on that. Clearly, we need to scrutinise those plans very carefully over the next year or two. In fact, Kate Forbes herself conceded that we have a cluttered landscape, but that is a real concern. I do not think that there is anyone here, either on the Government side or the Opposition, who is not alert to that fact. I am sure that my colleagues Gillian Martin, Dean Lockhart and John Mason will be doing precisely that, paying close attention to that in the Economy, Economy and Fair Work Committee. However, although the cluttered landscape is a potential danger, so too are misleading statistics about the Scottish economy. Dean Lockhart and Alexander Burnett cited some so-called research, published by the Scottish Touries today, about £8 billion lost to the Scottish economy. I look forward to debating those figures in future, but on a first glance, the first two missed targets that are mentioned in the Tories research, the so-called research today, relate to the same Scottish GDP, but compare the same Scottish GDP figures to two different points of comparisons to the rest of the UK and small European Union countries. However, given that that is the same GDP and it is compared to two different points of comparison, it is counting the sum twice, so I do not have much... Dean Lockhart. I would just clarify with Andy Wightman that the vast majority of that figure was, as a result of the failure to meet productivity targets, which the SFC, in terms of historical and going forward, has identified as one of the key reasons why the Scottish economy is underperforming. Andy Wightman That just further confuses matters, because productivity is another one of the areas where they claim that there has been lost finance. We need to welcome Dean Lockhart if he wants to come back to me in the £80 billion, with his workings out at the bottom, which would be useful. Willie Rennie, who I know is just walking into the chamber, mentioned and noted the need for the Scottish National Investment Bank to have a strong ethical investment policy. Indeed, that plays a part in our amendment. I very much agree, and is an opportunity to promote the living wage and to invest in clean and ethical projects. I also agree with his comments on salaries. He noted 90 institutions around the world, state banks around the world, which is evidence that this idea can work. However, if it is to work, the mission has to be critical. Claudia Beamish narrated the STUC's suggested mission, which I very much broadly agree with, but it does not mention growth once. That reflects the fact that this is, as I mentioned in my opening remarks, a redundant concept in the transition to a sustainable society living on a stable planet. That is why Labour's amendment pays so much attention to the concept that is not mentioned once by the STUC and whose mission Labour promotes is a mystery. I repeat Professor Mazzucato's observations, along with a wide range of other economists such as Kate Rayworth, that GDP and the feticisation of growth is the economics of the past and not the future, I will. Jackie Baillie at least recognised that the economy is currently stagnating. That is not good for business, it is not good for wages. Is he saying that growth is not desirable at all? Andy Wightman What I am saying is that the way in which we measure growth, the way in which we measure the very stagnation that Jackie Baillie mentioned, is highly flawed. It includes, for example, financial transactions, which historically have never been part of growth and do not add anything to economic wellbeing. James Kelly also observed that next year there will be a bill, and between now and then I would urge the Scottish Government to build genuine cross-party consensus and support for what is going to be in that bill. I hope that the cabinet secretary will share some emerging thinking on the content of the bill and indeed may consider consulting on an outline of a draft bill, not only with other parties and other members but with external interests such as the advisory group that helped Bernie Higgins. Kate Forbes, Gordon MacDonald and Richard Lyle, I discussed the potential of the SNP to support private companies with loans that are difficult to obtain from mainstream commercial lending. That highlights one of the key tensions in the political ambitions for the bank. That was also hinted at by James Kelly. In my view, the role of the Scottish National Investment Bank is not to provide conventional lending to conventional businesses as part of mainstream day-to-day business operations. It is certainly not part of the role of the Scottish National Investment Bank to support companies such as Two Sisters that produce dead chickens with a history of appalling food standards. SNP is a million miles from going anywhere near such a company. Many have mentioned in this debate as well the need for long-term patient capital. John Mason summed up some of the challenges that I thought very well, and that has to be the key for this very distinctive institution. That is why Greens in their amendment have put forward ideas such as a payment service and a banking licence that are worth considering if the Scottish National Investment Bank is to be bold and ambitious. Can I just say in fairness to Mr Rennie that he was present throughout your speech, Mr Wightman? Who would want to miss it? I now call Jackie Baillie to close for Labour. Thank you very much, Presiding Officer. I think that it has been a useful debate, and I hope that the cabinet secretary reflects on some of the contributions that are made. I think that it is clear that there is support for the Scottish National Investment Bank right the way across the chamber. It is fair to say that we want it to succeed because our economy is in trouble. The cabinet secretary always tells us that the fundamentals of the Scottish economy are all sound. I just regard that as breathtakingly complacent. I am absolutely convinced that his civil servants must hide the statistics from him, otherwise he would realise how hollow his words truly are. There is much that we agree on. The cabinet secretary talked about a focus on decarbonisation, transition to a low-carbon economy, an inclusive change and innovation, and much more besides. Those are positive areas on which we share a desire to focus. So, too, is the focus on helping SMEs to grow along with provision of long-term patient capital. Ivan McKee is right to point out the opportunity to invest in particular sectors to help to shape the economy and harness its potential. However, he talked about that in the context of an industrial strategy. Unfortunately, the Scottish Government does not have an industrial strategy. As I said earlier, it has not even bothered to tartanise the UK industrial strategy, and its economic strategy is so old that it has not taken any account of Brexit. I hate the idea of Brexit, but I dislike the SNP simply posturing about it and doing nothing practically to help to protect jobs and businesses. James Kelly was right to talk about the need to centre the bank in a coherent policy framework, but that is sadly missing. He also spoke about time. The bank will not be up and running until 2020, a shadow bank in 2019, but there is a need for urgency to help our economy to grow now. What will the Scottish Government do whilst we wait? Governance has been raised by a number of members, including Willie Rennie and Andy Wightman, and I welcome the fact that the bank will be established as a public body and that the board will be gender balanced. I would also welcome confirmation from the cabinet secretary that all investments will be a quality impact assessed, because I think that that will create a step change in the culture of investments. Let me agree very much with the points made by Gillian Martin about women's enterprise. There is huge, untaught potential in this area for growth, but it is important that the Scottish investment bank understands the difficulties that women have in accessing finance and makes women-owned businesses a priority growth sector. It is something that we have asked for both in the economy committee and in this chamber before, and it is not something that has yet been delivered. Why the hold-up? Gordon Lindhurst mentioned shipbuilding guarantees. Although I do not want to intrude on an argument between the SNP and the Tories, let me say as gently as I can that there are only two mentions of shipbuilding in the UK industrial strategy and one of them is in the bibliography at the back. However, the underlying point that he makes is the right one, because shipbuilding matters to Scotland. When Jim McCall, owner of Ferguson Shipyard and a member of the First Minister's Council of Economic Advisers tells us that they are unable to bid for some work because of the hundreds of millions of pounds required as a guarantee—which, by the way, other countries find a way of doing—then surely we should be trying to help. People expect both their Governments to work together in the interests of jobs, businesses and our economy. Can I also ask the cabinet secretary to address in his reply what discussions he has had with the UK Treasury and, indeed, the EU specifically about state-aid rules? I think that it is important that we understand the context in which the bank will operate given that state-aid rules are there. I say again to John Mason that the whole chamber is patient. We show just how courteous and patient we are when we are listening very attentively to his contributions. Finally, Presiding Officer, let me say as gently as I can to the cabinet secretary. No more announcements, please. I am growing old waiting for this investment bank. Thank you. I will take that compliment. Genuinely, we want you to get on with delivering the Scottish National Investment Bank. We on these benches will support you in doing so, but we absolutely need the Government to be more ambitious and bolder in what it is trying to do because our economy needs nothing less. Thank you very much. I call on Murdo Fraser to close the Conservative six minutes, please, Mr Fraser. Thank you, Deputy Presiding Officer. The context for this debate, as we have heard throughout, is the whole question of Scotland's economic performance. We learned today, following extensive reporting across a range of media outlets, that the SNP has missed five key economic targets. Target, they set themselves, Deputy Presiding Officer. They failure to match UK levels of economic growth, a failure to match economic growth in other small EU countries, a failure to increase exports, a failure to increase R&D spending, and a failure to improve productivity—a cumulative total loss of £80 billion. Andy Wightman Thank you, Mr Fraser, for taking that intervention. Although I accept on paper that those are missed targets individually, does he accept that, collectively, they do not add up to an £80 billion lost to the economy? Murdo Fraser Oh, Mr Wightman is wrong. Collectively, they do add up to £80 billion. That's the whole point. £80 billion is the cumulative total of the loss. I suggest to Mr Wightman that we want to read more. He reads our excellent press release, which contains detailed workings of how those figures are arrived at. He would know that, as likely as I was to see how extensively reported they were today, it just goes to show what you can achieve, Deputy Presiding Officer, on a slow news day on a hot bank holiday Monday. Even the Scottish Government acknowledged that there are problems. The SNP implementation plan refers, and I quote directly, to Scotland's economic weaknesses, mostly appearing to be getting worse. So there is an issue to be addressed. We, on those benches, are open to all good ideas about growing the economy. As my colleague Dean Lockhart set out earlier, we give a cautious welcome to the principle of the Scottish National Investment Bank, although there are more details that we await. The cabinet secretary raised the issue of special dispensation from HM Treasury being required to allow the bank to operate beyond the limits of the existing fiscal framework, in effect to allow additional borrowing. The implementation plan accepts that such dispensation is unlikely. It is important that we put on record that our qualified support for the bank as a concept should not be taken as an endorsement of a call for treachery dispensation. Indeed, as the implementation plan makes clear, it may not be necessary, as there is already some flexibility under the fiscal framework. However, we would be happy to discuss the issues in more detail with the cabinet secretary, if he requires. This is a bank that has been a long time coming, as Jackie Baillie and Tom Mason acknowledged. It is not a new idea. We have heard about it over more than a decade. The economist Alf Young was writing about it in 2009, saying that even then, this was not a new idea. We hope that it is greater success than the Scottish growth scheme, launched in September 2016 a £0.5 billion investment in the Scottish economy. We were told that, 20 months later, only £25 million has been allocated and none of that, as far as we know, has been spent. We have the Scottish European Growth Co-Investment Fund, which no funding leveraged in nine months after its launch. We should always forget that the vast majority of SNP funding comes from financial transaction cash, which the cabinet secretary for finance described when it was announced by the Treasury as a con. That money being put to good use, I am sure that he will reflect on his choice of language in relation to that particular initiative. I want to amend my amendment today in the name of my colleague Dean Lockhart, who focuses on the issue of a cluttered policy landscape. The Fraser Valley Institute claimed in its economic summary that came out just a few weeks ago that the Scottish Government has lost clarity of focus and delivery with a myriad of different strategies, advisory groups and bodies now cluttering the landscape. They are quite right to do so. We have to look at what the Scottish National Investment Bank is going to do and what current bodies are already doing. For example, we hear that SNP will finance SMEs up to £10 million, but the Scottish Investment Bank does that already. We hear that SNP is going to expand loan funding to SMEs of between £100,000 and £2 million, but the Scottish Investment Bank does that already. We hear that it is going to extend microfinance up to £100,000, but the SME holding fund does that already. As Alex Burnett said, we need greater clarity around what exactly the new bank is going to do and what it is going to do to replace the existing initiatives and what is going to happen to them. I have some sympathy with the Labour amendment. The issue that I have with it is that it talks about a comprehensive industrial strategy for Scotland, but we already have a UK industrial strategy. I would prefer the Scottish Government to be working as part of that, rather than trying to devise something entirely different. In relation to the Green amendment, I think that it is too prescriptive. It is trying too hard to tie the hands of what the investment bank will do. When it talks about a low-carbon investment, we already have the green investment bank in that space, so we need to avoid too much duplication. Dean Lockhart raised the question of running costs quite fairly—up to £30 million a year on staff salaries. That is a lot of money to spend, and Willie Rennie made a fair point about how we are going to pay those salaries and what rate we have paid and how we will scrutinise that, but we need to be careful that we do not scare away good people from coming to work in a public sector body where we are going to need talent. If we look at, for example, the Scottish Future Trust, which pays very high salaries, we will get a good return for the people working for that body as a result, so we need to strike the particular balance. That bank will fail if it is subject to undue political interference. It must be free to take risks and must make market judgments on investments. I have some sympathy for the points that were made by John Mason in that respect. After all, we are going to tie the bank to making ethical investments. How are we going to agree on what is an ethical investment, Presiding Officer? Just to say in conclusion if I can, it has been a helpful debate. In flashing out more detail, there are still issues to be resolved, but we need to grow our economy and we give this initiative our qualified support. I now call Keith Brown to close with the Government, Cabinet Secretary, eight minutes please. This has been an interesting debate, Presiding Officer, although the consensus that everyone talks about might be a bit more illusory as we go on through the process. It is also a very timely debate on what is clear from members' contributions. I think that how ambitious everyone is for the achievement of faster inclusive growth on the inclusive point, perhaps every except for the Conservatives. That is also an ambition that I share. A publicly owned investment bank will become a cornerstone of the economy that we want to create in Scotland. It has the potential to be truly transformative. We have heard a unique feature of the bank as its mission-based approach to investment, and those missions set by ministers and informed by consultation will give Scotland the potential to demonstrate global leadership on common challenges. The bank is going to have to be bold and ambitious in its approach as well as its financing and its governance. In terms of its scale, scope and adaptability, the Scottish Government is committed to capitalising the bank with £2 billion over 10 years. That scale is ambitious but achievable, and it will be a level that can make a material difference to the supply of capital to the Scottish economy. The bank will act on a commercial basis and have a different approach to risk and reward compared with other financial institutions. I could try to address some of the points raised by members. First of all, when Dean Lockhart spoke, he asked about which strategies—when he was asked, in fact, by Derek Mackay—which strategies should be ditched, he said that inclusive growth. That is an astounding thing for someone to say. However, we now know where the priorities of—yes, I will. Dean Lockhart What I said, cabinet secretary, and we have had this discussion in the economy committee, is that there is no settled definition of inclusive growth. You have come to the committee time and time again with different definitions of what that means. That is a good example of not only a cluttered landscape but muddled thinking in the Government's economic strategy. The fact remains that you were asked by Derek Mackay—sorry, the member was asked by Derek Mackay—which strategy you ditched in the first one. The only one that you came to was inclusive growth. I wonder whether the Tories, when they formulate their economic policy, if they do it in a darkened room? They are not allowed to acknowledge the UK Government's role in the economy. They are not allowed to acknowledge Brexit. They are not allowed to acknowledge the changes in oil and gas figures. They are not allowed to acknowledge austerity of the cuts. What kind of economic policy can you possibly develop that ignores those things, but you do it routinely—with exception of Gordon Lindhurst, who admitted the heretical thought that the UK Government might be active in the Scottish economy, although, turned, Gavin Brown's thoughts on the said, when he said that the major leavers in the Scottish economy were exercised by the UK Government, the confusion and Labour's thinking over that means that it cannot possibly come up with a rational economic policy. It can come up with a press release and it can usually guarantee it to get into certain newspapers quite easily. That does not make it make sense. I should also say that Jackie Baillie made the point about £20 billion. Unlike the Conservatives who asked us to get rid of some strategies, she wanted us to create some more. The £20 billion was contingent on—this is a big if—if Labour won the next election and Jeremy Corbyn finds £200 billion to put into that economy. We have heard this before. I remember that we should not have had to reissue the tender for the ScotRail contract, because Labour was going to win in 2015 and there would be any need for it. I am not sure that we can have policy waiting on the idea of a Labour victory, not least given its pathetic performance in local elections and as an opposition at Westminster. Over to you, Jackie Baillie. You see, this is the case of the cabinet secretary's true colours being on display, because the SNP has foam in this area. It is not interested in getting the additional funding coming to Scotland. Was it not indeed the case that one of your former leaders suggested that people in Scotland should not vote Labour, they should perhaps vote Tory? Look at what you have left us with. Cabinet Secretary. If you want to look at what we have left as we can remember what the first, the last words rather of the Labour chief secretary to the treasury was, there is no money left. The last words of the last Labour government, that is what Labour has left us with. We also had a number of comments. Ivan McKee, I think, talked very sensibly about autonomous vehicles and also the idea of an industrial hub, a very interesting idea that should bear further examination. Alexander Burnett mentioned the Scottish Government is, as I have said, pre-eminent in the Scottish economy. That kind of admits the fact that the UK Government might be involved as well. That is a kind of heretical thing to admit. Murdo Fraser, I think, talked about further consultation. I think that that is important and it will happen. We have said that that will happen. It is obviously the case that part of the process of what just now has had consultation to get to this stage, but there is much more that we should be consulting people with. Kate Forbes talked quite rightly about the Highlands and Islands, SMEs, the difficulty in finding available lending and especially patient capital, and Claudia Beamish mentioned regionality. I would accept that. The bank has to be seen to be serving the whole of Scotland. If there are gaps within the geography of Scotland, then it should be addressed by the bank. Just to say that, in comparison with the UK Government, where they have built an economy that is so unbalanced, the most unbalanced economy in the world in terms of the inequality within it and the dominance of London to the exclusion of much of England, Scotland, Wales and Northern Ireland, we cannot replicate that failure here in Scotland. Gordon Lindhurst mentioned the running cost being too high and what to do about capitalisation, which he felt was too low. I think that there is an element of confusion that we have heard among the Conservatives as to what they want this bank to do and how they want to do it. I think that Murdo Fraser's latter comments about the need to attract the right people to the bank are very important. I also think that, as Murdo Fraser said, that John Mason raised a number of very good issues, which are things that point to the tensions that will be here. There will be the demand to take action for sometimes managed decline in industry. There will be the demand from Opposition politicians to make sure that action is taken on whatever the issue of the day is. However, that stands in contrast with what we are setting the bank up to do in terms of patient capital and a long-term transformation of the Scottish economy. Those tensions will exist. Tom Mason, of course, gave us a wee insight, a wee retrospective insight into the Tory ideologs of the 80s. Get out of the way, Government. Don't touch bi-fabrously. Don't touch the steel industry. Don't touch Ferguson's. That would have made Frederick Hayek blush, had he heard some of the comments made. I was just watching the front bench of the Conservatives, as they were speaking, all looking at their shoes, desperate for their suites to be over with. It does give us an idea—I have already given it a couple of times—of how the Tory party in other parts of the party tends to think. We have also, from James Kelly, made the big mistake of thinking that the only threat that he should look to towards tenorol is the other side of Glasgow, and I would caution him against that. Threats can come from unexpected places sometimes. I would also say that the bank that we are going to establish is to be further discussed at the Economy, Jobs and Fair Work Committee later this month. Part of that discussion will, of course, focus on our response to the implementation plan. There is an opportunity for further discussion on those issues. Also, a written update will be provided to the Finance and Constitution Committee. A key priority moving forward will be the engagement with Treasury around the additional year. That was mentioned. I am not genuinely unsure as to what Murdo Fraser was saying about his approach and his party's approach to that. We are having constructive discussions with Treasury. It is about year-to-year flexibility, including carrying balances across, and perhaps as a misunderstanding here, I would hate to think that that was a precursor of a refusal of the Treasury to listen to the arguments that we have put to them. It seems an eminently sensible proposal that is not looking for more money. We intend to spend our own money, and I am happy to have that for the discussion with Murdo Fraser if he, in turn, wants to have that discussion with me. That is very quickly on the amendments. As long as the Conservatives understand that it cannot be the case that if there is clutter in the Scottish economy, and I accept that commentators have said that it can only be the responsibility of one Government, so let's have a genuine approach to look at the issue of clutter. Part of my proposals that I have already mentioned would try to address that by the incorporation within the new bank of some of the other functions that have been mentioned previously, so let's have that genuine discussion. I am afraid that you will have to conclude, cabinet secretary. A great deal in common. I would like to discuss some of the issues further. We support the idea of private capital being used. We are very interested in the Scottish payment company, but we cannot support the amendments to the reasons that have been mentioned, and we cannot support the amendment from the Labour Party, not least in terms of capitalisation. All and all, I think that there is a great deal that we can unite around here. If there is a genuine hope for consensus, I am determined to try and achieve that through further discussions through the committees and in the Parliament. That concludes the debate on Scottish National Investment Bank, and before we move on to next night with business, I know that my colleague in the chair has reminded members yet again not to use the term U of individual members. It can be used by a collective group like the Conservatives of Labour of Scottish National Party of Green, but not individual members. Train yourselves, please.