New infrastructure bank is planning to invest £40bn as a commitment to green growth
The UK government has announced a “real commitment to green growth” in yesterday’s 2021 budget.
Rishi Sunak, the Chancellor of the Exchequer, outlined strategies for the next year, including ongoing coronavirus aid for those out of jobs, funds for education and the arts, and, most importantly, a focus on a sustainable recovery.
There were two environmental promises made. The first, a new UK infrastructure bank will be established in Leeds and it will be granted £12 billion in funding and will strive to finance at least £40 billion in public and private projects starting in the Spring.
The second is a £15 billion investment in green bonds to help finance the country's path to net zero by 2050.
Sunak said that the UK must “do things that have never been done before”, emphasising the need for a strong, resilient economy post-pandemic.
"Our future economy needs investment in green industries across the United Kingdom,” he stated in the House of Commons. “We need a real commitment to green growth.”
The new infrastructure bank will help the UK meet its goal of being carbon-free by 2050. This is intended to replace funds from the European Investment Bank (EIB), which the UK will leave after the Brexit transition period expires on December 31st.
In the past, the EIB lent around €8 billion a year for initiatives ranging from London's Crossrail to social housing and new school construction.
The UK unveiled a ten-point climate strategy, called the "Green Industrial Revolution," in November 2020. It has a value of £12 billion (€13.4 billion) and is expected to generate 250,000 jobs.
Greenpeace, on the other hand, has spoken out about the promises made in yesterday's budget speech.
“For all the talk of a green recovery, this Budget suggests the Chancellor has failed to clock the urgency of the climate emergency,” says Rebecca Newsom, Head of Politics for Greenpeace UK.
She says that a national infrastructure bank and green bonds could be “steps forward”, but without a guarantee they will provide sustained investment to decarbonise buildings, transport and industry, they are “unlikely to do much to advance climate action”.
“Successive budgets that approach the climate and nature emergency in a half-hearted manner have left us running out of time and credibility,” Newsom concludes.