Budget 2011 reaction: Green investment bank

Paul King, Chief Executive of the UK Green Building Council

UK-GBC welcomed confirmation that the new Green Investment Bank will be able to borrow but questioned why this should not happen from day one.

King commented: “The Green Investment Bank is essential to plug the hole in low carbon investment and it is encouraging that this will be a proper bank, able to borrow. Sadly, the bank won’t be able to borrow from day one and it isn’t being used to finance the Green Deal, both of which are missed opportunities. However, there is a commitment from government to introduce incentives to encourage householders and businesses to take up the Green Deal - it’s just a shame this couldn’t have been set out in more detail.”

Tim Smith, Planning Partner at Berwin Leighton Paisner

“In the run up to the Budget there have been many rumours and counter-rumours about the form the Green Investment Bank would take and the powers it would enjoy. For a while it looked like the power of the Treasury would remove the power for the Bank to borrow - a power that most saw as being fundamental to the new institution if it were to be a proper “Bank” and critical to its success. As often happens the outcome is a mixed bag. It is another case of “Yes, but …” The Bank will have the power to borrow, but not just yet.

“Some have questioned the utility of a Bank that cannot borrow from Day One. But set against the prospect of an irreversible decision never to allow borrowing, or (even worse) not even to establish the Bank at all, the Government’s announcement gives some cause for optimism. So looked at overall is the glass half empty or half full? In my view it is half full.