Whitehall rapped over Green Bank selloff

An official report yesterday rapped the UK government for failing to secure long-term commitments when it sold off the Edinburgh-headquartered Green Investment Bank (GIB).

The National Audit Office (NAO) said that in its decision to sell the bank, the nowrenamed Department for Business, Energy and Industrial Strategy “lacked clear criteria or evidence” to prove that it had achieved its “intended green impact”.

The £2.3 billion sale to a consortium led by Australia’s Macquarie Group earlier this year was “at the lower end” of Whitehall’s valuation range, the report added.

The NAO also said that the process, which lasted nearly 18 months, affected GIB operations and resulted in key staff departures.

Macquarie has said the GIB will continue to finance environmental projects that help the UK meet its climate change goals in its first three years under private ownership.

But the NAO noted that those commitments are not legally binding and highlighted that the government has climate change commitments beyond 2020.

Amyas Morse, head of the NAO, said: “Ultimately the value for money of the Green Investment Bank intervention will only be seen over time.

“A key test will be whether the government needs to intervene again in this way to stimulate growth in the green economy and to help it achieve its climate change commitments.”

Set up in 2010, the bank financed 100 projects by last March, having attracted £8.6bn in private capital.

Created with an intention to“acceleratetheuk’stransition to a greener, stronger economy” by investing in green projects, the NAO said that the GIB was set up with a clear rationale and mission as well as a “sound basis” for its success.

However, the government did not set out how it would judge the GIB’S success in terms of its green impact.

“It also wanted GIB to be an ‘enduring institution’, but it was not clear what this would mean in practice,” the report noted.