The government’s announcement to sell off a large chunk of the Green Investment Bank (GIB) to the private sector is ‘a slap in the face’ for small and medium-sized enterprises (SMEs) seeking much needed finance for ‘green’ manufacturing initiatives.
Unite was commenting as business secretary Sajid Javid announced today (June 25) plans to bring private capital into the Edinburgh-based bank, which was launched in 2012, as the first such bank in the world.
“The Green Investment Bank was set up to help small and medium sized enterprises (SMEs) to obtain the finance needed to provide assistance in developing ‘green’ manufacturing,” said Unite assistant general secretary for manufacturing Tony Burke. “SMEs produce 80 per cent of the manufacturing output in the UK.”
“Now the rug has been pulled from under the SMEs and it is back to square one with these businesses having to rely on borrowing from the tight-fisted mainstream banks. It is a slap in the face for these entrepreneurs.
“The government has no enthusiasm to invest in manufacturing, ‘green’ or otherwise,” Burke added. “This is another blow to the calls from Unite, amongst others, for a coherent manufacturing strategy for the next decade.”
“It also poses serious questions about the government’s commitment to a low carbon economy, given that only last week ministers said they were ending the subsidies for onshore wind farms from April next year.
“Unite called for a Green Investment Bank, and while it has played an important role in supporting a greener economy, the GIB that was created is constrained. The government should be giving it borrowing powers rather than selling its share.”
The GIB has invested £2 billion of public money since 2012 in 50 green infrastructure projects and seven funds in 240 locations around the UK.