The green investment bank: Do it now, make it big

Article

The government has committed to setting up a 'green' investment bank. Yet the sums the government is committing are tiny: £3 billion, or about a fifth of 1 per cent of GDP, which can hardly have a huge effect on the economy. Gerald Holtham argues for swift action to establish the bank, and an ambitious change of scope in its operations.

Holtham argues that the bank should be able to borrow additional funds earlier than the mooted 2015/16 date, and that such borrowing needn't count against the government's austerity drive. Rather than as loan capital, he says, the government's initial £3 billion allocation should be committed as reserves to guarantee a much larger loan, perhaps to underpin a balance sheet worth some £100 billion: disbursed over five years or so, this much larger amount could raise investment in the UK by more than 1 percentage point of GDP per year.

Related items

  1. Train and cars on a motorway with London skyline in background

    Planes, trains and automobiles: How green transport can drive manufacturing growth in the UK

    Transport is essential to our lives. Unfortunately, it is currently also the largest source of UK domestic carbon emissions. 

  2. Regional economies: The role of industrial strategy as a pathway to greener growth

    Regions like the North should have a key role to play in the development of a green industrial strategy.
  3. A mother and child walking in a field with hills in the distance

    Achieving the 2030 child poverty target: The distance left to travel

    On 27 March, the Scottish government will announce whether Scotland’s 2023 child poverty target – no more than 18 per cent of children in poverty – was achieved.