Government should consider setting up UK infrastructure bank to replace funding stream following Brexit.
The Brexit Infrastructure group have said that the government needs to consider setting up a UK infrastructure bank to replace any impending loss of finance flowing from the European Investment bank.
The European Investment Bank (EIB) provided more than €20Bn of anchor investment for UK infrastructure projects between 2011 and 2015, which acted to pull in substantial additional private investment.
The Brexit infrastructure group was set up to lobby government to provide expert insight on behalf of the construction industry.
Sir John Armitt, the group’s Chairman, said: “The EIB has been a vital part of the investment mix, acting as a critical anchor investor, funding billions of UK infrastructure projects and attracting other sources of funding.
“If we are at risk of losing this source of investment, the government should start consulting with industry now on alternative options, including the potential for an infrastructure investment bank. This will send a clear signal to the market, and help consolidate the UK’s reputation as a global leader in infrastructure delivery.”
The government has experience of setting up banks to attract infrastructure investment. In 2012, the coalition government set up the Green Investment Bank to promote the renewable energy sector. To date it has backed 98 green infrastructure projects, committing £3.4Bn of public money to projects worth £12Bn.
The government have been trying to sell it since 2015, to get it off the Treasury’s balance sheet, suggesting that it may not have any desire to set up a UK Infrastructure Investment Bank, as proposed by Armitt’s committee.
The Brexit Leadership Group also recommends that the government guarantee the status of foreign EU nationals currently working in the UK in advance of any reciprocal deal securing rights for UK workers across the EU.