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That is covered by building regulations, but I am more than happy to take it away and we can come back to you with some further detail, including on the technical points that you have raised on how the points system operates.

I will deal with some of the inflationary pressures and Ben Macpherson can pick up on the wider public sector finance situation and funding for pay increases.

There is no doubt that the increasing inflationary pressures that are being experienced by local authorities will have an impact. It is difficult to quantify exactly to what extent those pressures will have an impact, but the cost base for carrying out capital works has increased because of both material and labour cost increases. That will clearly put pressures on local authority budgets, as it will for the Scottish Government and other parts of the public sector. There is no doubt in my mind that inflationary pressures will have an impact, but it is difficult at this stage to quantify that impact.

It is also worth keeping it in mind that some of the pay challenges that local government has faced have resulted in additional funding being provided to local government to try to help to meet and offset some of the additional costs associated with the pay awards. That was as part of our on-going engagement with COSLA to try to help to resolve the pay disputes that were taking place. Ben Macpherson may want to say a bit more about local government financing.

Nuclear will not be reducing energy bills any time soon. For a start, such projects take a long time to be developed. You just have to look at Hinkley Point C, which is behind schedule and about £5 billion over budget. Given the subsidy costs that nuclear requires, it is likely to force up bills—I think that the estimate is an extra £40 on folks’ bills.

Nuclear energy is one of the most expensive forms of energy that can be produced. Just last week, Kwasi Kwarteng, the energy secretary in the UK Government, acknowledged that there is a risk of nuclear pushing up bills, even in the short term. Therefore, I think that it is the wrong approach. In fact, we can see other countries in Europe moving out of nuclear. For example, Germany will be closing its last reactor this year, and it is very clear that its strategy is to focus on renewables.

Our approach to nuclear energy is not ideological. Greg Hands has said that to me before, and it has been pointed out to him that that is wrong. In our energy strategy back in 2017, we set out the principles of why we do not support nuclear energy. In Scotland, we think that the best approach is to focus on renewables and that pump storage, hydro and battery storage capacity are the ways in which we can tackle our future energy needs.

We know that onshore and offshore wind are significantly cheaper and produce significantly lower-cost energy, and we also know that, by and large, hydro produces more lower-cost energy. In Scotland, we have a number of schemes that could be taken forward; however, there are frustrations in that respect. I would highlight as an example the 600MW facility Cruachan 2, which is being planned by Drax and which I visited last year. The problem is that Drax cannot take it to the market, because the UK Government has not provided the market mechanism to get it into the grid. It is an investment of more than £1.5 billion, potentially involving about 900 jobs, and it would also have the on-going benefit of being a renewable energy source, but it does not have a route to market.

The same applies to SSE and some of its plans around hydro. Just a fortnight ago, I visited the scheme at Sloy, which SSE is looking to expand and develop. Again, there are limitations due to the lack of a market mechanism from the UK Government, and the situation is quite frustrating.

If you look at the countries with the lowest energy costs in the world—Norway and Canada—their biggest energy source is hydro and pump storage. More than 90 per cent of Norway’s energy comes from that source, while, in Canada, the figure is 60 per cent. Our view is that the best approach for delivering energy security and lower-cost energy supplies in Scotland in the future is through renewable energy projects, whether they be onshore, offshore, solar, hydro, pump storage or battery storage. We should focus on them for our future energy needs. The UK Government has got it seriously wrong in its energy security strategy, because it focuses too much on nuclear, which could actually maintain energy prices at higher levels than they should be at or could potentially increase them.

Did you say 1930?

You are right to say that tackling fuel poverty is a devolved matter, but many of the factors that influence it are reserved—

If National Grid provides the capacity, including the planning capacity, for all the projects to be delivered by 2030, that is when the generation will happen by. If National Grid does not provide the capacity by then, the projects will not be able to be connected by that point. You do not build a wind farm without a connection.

Why would a developer build a wind farm pre-2030 if National Grid said that it could not be connected until 2035?

Let me finish my point, Mr Kerr.

We must look at the facts of the matter. Fuel poverty is greater in Scotland, because the household cost of using fuel in Scotland is greater than it is in other parts of the UK, as a result of our weather and our rural environment. A household in Scotland will spend more of its budget on fuel costs—in Scotland, the percentage is about 4.8 per cent, compared with about 3.9 per cent for England.

Not only do we spend more of our budgets on heating our homes in Scotland, but a greater percentage of our households are off grid and use off-mains systems that are more costly to operate. I think that the figure is about 17 per cent, compared with about 12 per cent in England—those are rough figures, not specific ones. Such factors influence the cost of energy and impact on energy bills.

What is the Scottish Government doing? We have our warmer homes Scotland programme, which is about energy efficiency and insulating properties. As I have mentioned, over the course of the parliamentary session, record investment of £1.8 billion will go into our heat in buildings programme. We have been expanding our area-based scheme, the households involved and the amount that they can get to support them with energy efficiency measures, and we have also expanded and, indeed, intend to increase the investment in the benefits that we control.

A practical example is the winter fuel payment, which we will become responsible for and which families or households will receive automatically, instead of having to wait to see whether the weather gets cold enough. I think that that will amount to the provision to households of about £20 million a year, from which in the region of 400,000 additional homes will benefit. Last winter, the UK Government’s cold weather payment system was triggered on only six occasions, with four of the weather stations in Scotland being triggered. The overall amount paid out by the Department for Work and Pensions in support of low-income households was under £400,000. We should compare that figure with the £20 million that will automatically be invested by the Scottish Government in its winter fuel payment scheme.

With our energy efficiency programmes and the benefits that we control, we are seeking to make a difference. However, the UK Government controls aspects of the market that have a direct impact on energy costs, including the regulation of off-grid provision and the operation of the warm home discount scheme. All those things have an impact on fuel poverty here in Scotland, and we believe that they need to be addressed to ensure that we are moving in the right direction.

My final point is that, although we are taking action through the benefits and the welfare provisions that we have to reduce poverty, whether fuel poverty or child poverty, those efforts are not being aided by the UK Government cutting people’s benefits at the same time. If we increase our benefits by £20 per household but the UK Government cuts its benefits by £20, there will be no net gain for that investment in reducing poverty.

The reality is that many of the levers that have a direct impact on driving fuel poverty in Scotland are held by the UK Government, and that has a negative impact on too many households across the country. That is why action needs to be taken by the UK Government, alongside the bold action that the Scottish Government is taking, to address some of the issues that have affected too many households for too long.

Yes, I do, and it was a positive move to start doing it every two years rather than every year. CFD is not specific to the UK. The Netherlands, Germany and some other countries all use CFD processes. It is not, therefore, unique to the UK. It is a mechanism that helps to get things to the market.

The point that I was making about hydro, however, was that there is no mechanism for hydro. If you wanted to build Cruachan 2 today, you would not have a route to market because BEIS has to create such a mechanism. There are projects that could be developed and go forward with billions of pounds of investment to produce several gigawatts of capacity and create thousands of jobs, but they are waiting for a mechanism to be created that will allow them to start moving.

That is frustrating, if we are clear—and I believe that the UK Government is clear—that we will have to deal with the energy crisis in the long term by decarbonising our energy system and putting a greater focus on renewables. The UK energy secretary said that and I completely agree with him. However, when your renewables projects are quite literally fossilising because they cannot get a route to market, there is something wrong. That is why we have been raising the issue with the UK Government. Those projects could create energy capacity, renewable capacity, jobs and economic benefit, and we should be getting on with them now. That is the kind of action that needs to be accelerated.

Our approach will involve a combination of factors. First of all, we are trying to find mechanisms to reduce energy bills for those who are most vulnerable, so my first priority would be a targeted programme to support the most vulnerable households with their energy costs, whether it be through the welfare mechanisms or some other mechanism.

My second priority relates to energy efficiency. The cheapest form of energy that you can use is the energy that you do not use, if you like—I know that that sounds a bit contradictory, but what it means is that we need to help ramp up energy efficiency programmes, which is what we are seeking to do with the £1.8 billion investment over this parliamentary session that I have already mentioned. That is a record level of investment, but we would, of course, always look to do more within that.

The third priority is advice to and information for householders about what they can do and what their options are. We want to support individuals who are looking for information and advice.

Those are the three areas that I would prioritise with any investment that will be made available over the next couple of months to help households through this particularly challenging period.