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We monitor the position very carefully. The data on transactions and on the volume of tax generated is published monthly. The information about what has happened to the number of transactions and to revenues will be available. If we decide to change LBTT rates in any way, that will be part of the projection work that is undertaken and information about that will be set out to Parliament.

There are a number of things that we have to do to address that issue. Mr Greer’s characterisation of much of the debate is entirely accurate.

In the course of the limited period of time that I have been back in the finance and economy portfolio, many people have told me to, invariably, use the reserves, but they are all being used; borrow, but we cannot borrow; increase tax, but we cannot increase tax by law; and, finally, get down the back of the sofa and see what is there. Those four options do not provide answers to the challenges that I face, hence my statement to Parliament on 7 September.

Some of the answers to the problem that Ross Greer has raised lie in the points that I exchanged with Liz Smith in the programme for government debate and in our discussion during this meeting. In Parliament, we need to have a totally realistic, open discussion about the relationship between tax and spending. What we are prepared to argue for in spending terms, we need to be prepared to argue for in tax terms. I use “tax” as a catch-all for tax, revenue raising, level of borrowing—in other words, the income side of things. Let us have a proper discussion about that. I am very open to having that discussion. I not sitting here saying that there are easy answers; really difficult decisions will have to be taken and we will have to have a climate of openness.

I do not know whether you heard me say this in my opening remarks, but I am doing two things this year that I hope will help in that respect.

First, I have invited three significant economic voices to provide commentary to our debate—dispassionately; it is for them to construct their contributions. I had a briefing session last week with Professor Anton Muscatelli, Professor Frances Ruane and Professor Mike Brewer, and I invited them to reflect on the issues with which we are wrestling. I suspect that the discussions in this morning’s meeting will be a helpful reference point for them. They will contribute to the debate and set out some of the issues that we have to consider. I expect that group to make a couple of interventions in the debate. I have told it that I do not want recommendations and that it is up to me to decide what to do and what to put to the Parliament. However, I want it to help to inform commentary and discussion on the situation and to be as dispassionate as possible.

Secondly, I will open a consultation process on the various challenges that we face when it comes to tax and public expenditure. I will publish a discussion paper to encourage public engagement on choices. I expect to do that around the timing of the emergency budget review.

I do not think that there is a pot of money is likely to come with the investment zones, but there will be fiscal incentives through reduced national insurance contributions, which is an issue that is properly within the competence of the United Kingdom Government under the constitutional arrangements. The UK Government says that it would like the concept to be extended to Scotland but that it properly understands that there are many devolved issues.

I have no complaints about the nature and the manner of the dialogue that we are having on that question. Some of the judgments come down to some of the issues that Mr Mason has already raised with me.

We have to proceed with great care here. I cannot accuse the United Kingdom Government of proceeding with great care on the issues and, with the greatest respect, I cannot accuse the Scottish Conservatives of proceeding with great care on the matter either. Within the past 10 days, I have been called on to mirror tax policies that have now been dumped by the UK Government, just 12 days later. That is no way to undertake tax policy—it is a total farce.

We have to look at the issues carefully. There is a relevant relationship between the tax position in Scotland and the tax position in the rest of the UK. However, there are the other policy commitments that people have access to in Scotland, such as significantly lower council tax and free prescription charges, as well as the fact that children in Scotland get more early learning and childcare than children in the rest of the UK get, and the fact that children who live in Scotland do not have to pay tuition fees if they go to a Scottish university.

Despite all the talk about relative tax positions, for some people, some of those UK Government decisions are completely incidental compared to the difference in council tax between Scotland and England, which is about £500 on average for band D. It is about £500 lower in Scotland, so there have to be really dramatic changes before a band D council tax payer in Scotland will decide to uproot their family and entire circumstances to try to get a degree of income tax advantage, while jettisoning a host of other benefits to which they have access in Scotland.

That is why, as I said in my opening remarks, I am going to air that debate about public expenditure and taxation. It is a rounded debate. We cannot have a compartmentalised debate about tax rates without looking at the whole public expenditure and tax proposition, because that will affect many of the choices that people make.

Finally, for the record, of course I want Scotland to be an attractive place for investment. The record speaks for itself. Other than London and the south-east, Scotland is the most successful location for foreign direct investment across the UK and has been for the best part of the past 10 years, if not longer.

On people’s availability, that has been fundamentally affected by Brexit. There will be other factors, but that is undoubtedly the key factor.

As I said in my earlier answers, we have to make careful judgments about tax policy, because we must be mindful of the legitimate issues that you put to me. However, we must consider those in their proper perspective, which is why I cite the other issues, including the need to consider what the total relevant housing costs are. Property prices are higher in England than in Scotland, so people will have to be able to command much more substantial salaries to afford those properties if they are trying to buy them with a mortgage.

A variety of other measures in place in Scotland provide some degree of difference in the availability of public services, whether that is in relation to lower council tax, no tuition fees, more early learning and childcare, no prescription charges and so on. There has to be careful consideration of all those questions.

My final point is on the mini-budget. The chancellor took the decision to change stamp duty on the basis that it would stimulate the housing market in England. He has done enormous damage to the housing market in England, because of the fiscal recklessness of the mini-budget and what it has done to interest rates. I have read stories in newspapers about people who were all set to buy houses but cannot now do so because interest rates have gone through the roof. Those young people were full of hope about getting on with their lives. With total recklessness, the chancellor has just shattered all that.

Forgive me for wanting to be careful about the tax decisions that I take, but on the basis of what the chancellor has done, a lot of misery has been created for people who were about to take big steps in their lives and have had that taken away from them.

We are contributing towards the financing of some of that new housing activity but the fiscal model has to be sustainable.

It is an issue that the Parliament and the Government have to be careful about in relation to the rent freeze question and what implications that has. We have to be open about any potential implications that come from that, but undoubtedly it is an example of an approach to co-investment where we need other parties to be able to undertake fiscally sustainable measures.

I come back to my answers to Liz Smith on the challenges that we face around realising economic opportunities. The housing challenges that we face are not just about the Highlands and Islands; the convener’s constituency will face acute challenges in relation to housing availability and workforce, and the necessity to ensure that there is accommodation to contribute towards economic growth. The last thing I want to see is any lack of constancy in the housing investment programme. It is not a capital saving that I would be particularly interested in pursuing.

There are a number of issues in your question. First, there is a legitimate and proper place for borrowing for investment in our economy. We have borrowing powers. Mr Mason asked me whether the value of those should be increased. There is always an argument for that, but there must also be fiscal sustainability. When finance ministers set budgets, they must be confident that we can service the debt that we take on. However, borrowing for investment in the infrastructure of the country is total common sense. We do it successfully.

There is then the scenario of borrowing to deal with the dynamics of change and fiscal shocks. We have a small degree of borrowing capability to deal with a Scottish economic shock and we have some fiscal flexibility about how much money we can carry over from year to year to deal with a shock. We are using some of that flexibility to the maximum now. That still does not prevent me from having to redirect £560 million of public expenditure from previously expected projects to meeting the in-year costs of pay demands and inflationary pressures that are much greater than were anticipated when the budget was set. Therefore, I am planning on the basis that I have to find about £700 million more than I anticipated in this financial year to fund pay deals. That is why I am having to make the changes that I am making.

There is an argument for saying that, in the circumstances that we have, with inflation at, currently, 9.9 per cent compared to 2 per cent when the comprehensive spending review was undertaken or even 5 per cent at the start of the financial year, we should have some resource borrowing power to avoid having to take some of the dramatic decisions that we have to take. We do not have that flexibility just now. It would be helpful to have it but I come back to my fundamental point that those powers must be exercised in a climate of fiscal responsibility and sustainability, whichever way we exercise them.

There is an immediate short-term issue that revenue from LBTT might not realise our expectations. Equally, it might exceed our expectations. However, there is a substantial interruption to the housing market just now, so I think that it is likely that revenues will be undermined as a consequence. The forecasts that we undertake are designed to provide as much certainty as possible about the implications of the policy decisions that we make. Essentially, we will be mapping out what our policy approaches will be, securing projections on the basis of those and making financial decisions accordingly. However, those factors are material to the performance of the budget.

It might be helpful if we could write to the committee to give absolute clarity about those details.