Green Investment Bank steps closer to privatisation
Business Secretary Sajid Javid has confirmed plans to remove ministerial powers over the Green Investment Bank (GIB) in a major step forward towards the bank's controversial privatisation.
Writing in a ministerial statement today (15 October), Javid said he was planning to remove public sector controls that allowed ministers to veto changes to the articles of association of the bank.
He said the change would allow the bank to borrow and raise capital without it affecting public sector net debt - a crucial part of its transition to a private entity.
The privatisation of the GIB was announced back in June. Javid said the transition would allow the bank to access a much greater volume of capital than if it were Government-owned.
“This means it can grow its business, move into a wider range of sectors and have greatest possible impact in mobilising investment so that more green projects get financed more quickly than would otherwise be the case,” he said.
Javid was also quick to try and assuage fears that a privatised GIB would stick less rigidly to its environmental brief.
He added: “I wish to make clear that the Government also wants and expects a privately owned GIB to continue this clear focus on green sectors - mobilising more private capital and further accelerating the transition to a green economy.
“It is clear from preliminary feedback that potential investors are interested in acquiring a stake in GIB precisely because of its unique green specialism and its green focused business plan. As part of any sale process, we would expect potential investors to confirm their commitment to GIB’s green values and to set out how they propose to ensure these are protected.”
Speaking to edie earlier this year, the GIB’s head of sustainable finance said that the bank’s successful investments in the first few years of its existence were helping to mobilise international investment in UK green infrastructure.
Just last week, the GIB announced that it had raised almost £1bn for the world’s first offshore wind fund.
Mind-bogglingly backward step on Green Investment Bank. Lords must reject. Will oppose when Bill reaches Commons. http://t.co/9RrQ6AgPZo— Caroline Lucas (@CarolineLucas) October 15, 2015