The Government has declared that it will repeal the relevant sections of the Enterprise and Regulatory Reform Act 2013 so that it can rapidly privatise the Green Investment Bank (GIB). Whilst privatisation at some stage was expected, the sudden announcement took everyone by surprise and CPA has expressed its concerns to several Members of both Houses.
The concerns involve initially the speed with which the proposed privatization is progressing – announcement only a week or so ago and initiation of debate in the House this week – and the distinct possibility therefore that the privatisation will be rushed and ill thought out causing the very uniqueness and effectiveness of the GIB to be severely compromised. The Bank has been successful in bridging the risk gap that investments in new technologies and processes require.
It already turns a profit and though it certainly does need to move to a position of being able to borrow additional monies from the markets, it is vital it retains the expertise on staff that understands and can scrutinise projects requiring investment. It goes places that other private capital is not yet prepared to go and is able to take an informed risk on new projects and thus is able to nurtue the innovation required to meet our low carbon, energy security challenges.
If it loses this role in the marketplace then it will become just another bank. The key message therefore is that GIB needs to maintain its unique aspects as a bank, and this could so easily be lost if a quick privatisation process is put in place. See the Ministerial statement here. Find information about the debate on the Future of the Green Investment Bank here. For further information contact jane.thornback@constructionproducts.org.uk