GIB sale risks repeat of "Royal Mail debacle"
Ministers have “rushed” to privatise the Green Investment Bank (GIB) without properly considering the alternatives, the Environmental Audit Committee has warned.
The likely sale of the GIB to Australian bank Macquarie “should not proceed” unless the government can ensure it will “continue to exist as a low-carbon investor”.
“Taxpayers do not want to see a repeat of the Royal Mail debacle where public assets were sold at bargain basement prices, and they do not want to see a landmark British institution sold off to an asset stripper,” said committee chair Mary Creagh.
She made the comments alongside the publication of letter which she sent to the business and energy secretary Greg Clark on 20 December.
Macquarie has “already been subject to criticism” over its management of other infrastructure companies such as Thames Water, Creagh wrote in the letter.
The MP for Wakefield asked what steps the government had taken to ensure the new owners maintain the bank’s green ethos: “In particular, I would like to know how much capital the bidders have committed to invest in the bank over the next three to five years.
“Will the preferred bidder, as a condition of the sale, be required to give an undertaking to the government to provide significant new capital annually?”
Creagh said she was pleased the government had accepted the recommendation to set up a special share structure made in the EAC’s 2015 report on the future of the GIB. However, she questioned how the government intended to prevent the bank for being broken up in the future.
“It is essential that parliament are informed of the proposed terms of any sale of the bank before it is agreed and that the government sets out any commitments made by the new owners to respect the green purposes of the bank,” she added.
A spokesperson for the Department for Business, Energy and Industrial Strategy said: “Any government decisions on the sale of the Green Investment Bank will be driven by what best achieves our objectives, including continued investment in the green economy and a sale which is in the best interests of the taxpayer. This is a commercially sensitive process and it is inappropriate for us to comment further while that process is ongoing.”
Earlier this week former energy minister Greg Barker called for the sale to be halted to prevent the bank being broken up and stripped of its assets.
- Offshore wind hits cost target four years ahead of schedule A target to reduce the levelised cost of energy (LCOE) for offshore wind to £100/MWh has been met four years ahead of the...
- Water licence application process favours incumbents The water supply and sewerage licensing process was “made for incumbents” and could be discouraging new entrants from...
- Brexit could put Hinkley over budget and behind schedule Britain’s exit from the European Union could put Hinkley Point C over budget and behind schedule, EDF has hinted.