The Green Investment Bank (GIB) will “start life as a lame duck” if the Chancellor refuses to let it borrow money from “day one”.
That’s the concern about the Government’s new lending body, which green groups suggest won’t be able to fulfil its potential if it can’t borrow money until 2015.
Yesterday Edinburgh was revealed as the home for the Bank’s funding decisions, with financial operations based in London.
Campaign group Friends of the Earth was underwhelmed by the announcement.
Its Economics Campaigner David Powell said: “Choosing the HQ for the Green Investment Bank has been like arguing about where to put the cherry on a half-baked cake.
“This is great news for Edinburgh, but George Osborne’s inadequate support means it will start life as a lame duck.”
Others were also sceptical. Sue Charman at charity WWF-UK said: “While we welcome and support the announcement of the location of the GIB this should not take away from other important unresolved issues. The current proposals that the bank won’t be able to borrow until 2015 risks hindering urgent and much needed investment in green jobs and technologies and the UK Government should reconsider this.”
But BIS said the Bank had plenty of cash to last for the next three years.
A spokesperson said: “The GIB is being capitalised to an extent that it will not need to borrow before 2015/16. The GIB will be given borrowing powers at this time subject to the targets for reduction in national debt being met and further state aid approval being granted.”