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I cannot speak to each individual line; I do not have any more detail on that.

I am happy to consider all suggestions in detail. Hamish Goodall might have something to add about the engagement with the Faculty of Advocates on that point.

Fundamentally, it is because it relates to the reserved matters of financial services and financial markets. I recognise the point that the member raises about the fact that there can be contrasting opinions, but we have sought to take an approach that ensures that the matters that we believe are within competence can be considered as part of the bill, and the one area that we do not believe to be within competence can still be effected, albeit through another process, namely the section 104 orders that are provided for by the Scotland Act 1998.

Indeed. I referred to what I hope will be strong political support within the Parliament but there is evidence from the submissions that the committee has received and from wider commentary that there is significant support for the financial instruments to be covered. I hope that the UK Government will recognise that and engage constructively so that we can achieve the aim as soon as possible.

We have raised the issue and I am certainly alive to it. I am also conscious of the comments by the keeper of the registers last week when the committee inquired whether there should be provision in the bill to enable joint registration. I am happy to consider that as part of the stage 2 amendments.

Is there any update on engagement with the UK Government, Hamish?

It is clear that there are incentives for those who will use the register to operate it in such a way that it is, in effect, self-regulating.

I will make two points. The register will be a new one, and we want time for it to bed in and to see how it operates in practice. However, the committee will appreciate that there are provisions in the bill to enable ministers to make regulations to address the points of concern that have been raised. At this point in time, my view is that we would want to see how the registers operate in practice and what sort of behaviour there is, but there is the option of addressing any clogging-up issues that have been highlighted through delegated powers.

Hamish Goodall might want to add to that.

This is the area of the bill that people would agree is the most contentious, and on which the most commentary has been made and in which wider interest exists.

I recognise the concerns and I take them very seriously. As I said earlier, I met Citizens Advice Scotland and other stakeholders in the money and debt advice sector this past week to hear their concerns directly. They made many similar points to those that the committee heard in oral and written evidence. I am conscious of the broader concerns that have been narrated that the legislation could create an environment that is favourable to high-cost predatory lenders. It is difficult to specify the form that that environment might take, but the concern is based on those organisations’ professional experience and institutional knowledge. I want to be clear that I take that concern seriously. We all agree that we absolutely do not want to see emerge, as an unintended consequence of the bill, the creation of an opportunity for those who have been described as high-cost predatory lenders.

As Mr Mundell suggested, one option is the removal of what has been defined as the application to consumers, although the bill does not make specific reference to consumers but, rather, to individuals. There is a particular point about clarifying certain protections in relation to the statutory pledge, too. I am content to consider those options. I appreciate that I have made this point a few times, but I stress that I am keen to see, and will be informed by, the conclusions of the committee’s deliberations.

It is important to recognise that, if we were to seek to effect that aspirational removal of individuals or “consumers” from the bill, there would have to be careful consideration of how that could be done in the drafting.

There is also a specific issue, which the FSB raised, with regard to individuals and sole traders, particularly on access to finance. There would need to be careful consideration of that.

I am conscious that, as we seek to prevent potential risks, we must not generate unintended consequences that would limit the impact and policy objective of the bill, which is about opening up financing opportunities to businesses of all sizes, particularly those that want to grow but that do not have any heritable property and that would rely on using moveable property as collateral.

On the option that you articulated, in which individuals would still be able to make use of the statutory pledge but there would be certain additional protections, we would certainly look at increasing the monetary threshold if that is where we land. I recognise that £1,000 has been described as a placeholder figure; it dates to 2017 and the amount should be increased. If the committee has any particular views on what the amount should be, I would be keen to hear them. If that is the scenario that ultimately prevails, we must set an amount that precludes the possibility of household goods being used as collateral for a statutory pledge.

I take the point that you seek reassurance by having something put in the bill. However, I am sure that you would agree that the additional provision of regulation-making powers is important to keep pace with any developments that we might not have anticipated. That is another scenario.

I am conscious of the written evidence that the committee has received in recent days, including from Professor Steven. We need to carefully consider how the bill interacts with existing consumer protection regulation—the Consumer Credit Act 1974 being one example. We are absolutely clear on what the potential risks are, and we recognise that there are protections that sit in other legislation or regulatory regimes that operate in wider legal structures, although that might not be explicit in the bill.

Do you want to add anything, Hamish?

Good morning. It is a pleasure to be in front of the committee. I have many fond memories of being a member of this committee, and I can only hope that I am still saying that it is a pleasure to appear before it when we get to the end of the evidence session.

The committee will be aware that there is significant support for reform and modernisation of Scottish moveable transactions law among those who use it, since it is out of date and inadequate by international standards. If implemented, the bill would make various types of commercial transactions more efficient, less expensive and less complicated than they currently are.

Moveable transactions law enables businesses and individuals to use their assets to raise finance by selling debts or by granting security over moveable property. For example, a business may wish to acquire funding by transferring to a financial institution its claim to payment of existing and future customer invoices. That would be done by means of an assignation. Alternatively, it might want to retain assets such as vehicles, equipment and intellectual property, but to use those as collateral to obtain loan finance. That would be done by means of the new statutory pledge. That would lead to greater access to finance for businesses in Scotland, thus benefiting the general economy.

I am aware that the committee has heard evidence from Citizens Advice Scotland and money advice agencies, and that they have suggested that the bill should apply only to businesses and not to individual consumers. They have also suggested that, if the bill is to apply to individual consumers, the consumer protections in the bill should be strengthened.

When the Economy, Energy and Fair Work Committee took evidence on the proposals in the previous session of Parliament, the vast majority of respondents indicated that they thought that the consumer protections in the bill were perfectly adequate, and I understand that many respondents to the committee have repeated that view.

However, last week, I met Citizens Advice Scotland and some of the debt advice agencies and listened carefully to what they had to say about the application of the bill to consumers. I am certainly well disposed to strengthening the consumer protections in the bill and, in particular, I believe that the monetary threshold under which it will not be possible to grant a statutory pledge should be raised from £1,000.

I am also in no doubt that the policy of the Government should be that it should not be possible to grant a statutory pledge over ordinary household goods. We can look to see how the bill might be amended at stage 2 to ensure that that is not possible.

On that note, I will conclude. I am happy to take any questions that the committee might have.

I note that the body in possession of the most up-to-date opinion is this committee, because of the evidence that it has received as part of its stage 1 inquiry. I refer again to the evidence that the committee received from the representative of NatWest last week.