The UK’s flagship Green Investment Bank (GIB) has not been investing in Scotland, despite being headquartered in Edinburgh, because it cannot find “profitable” schemes north of the Border, MSPs have been told.
There are also concerns that the £4 billion bank’s Scottish base is just a “back office”, with the bulk of decision-making, staff and high-earners located in London.
The bank opened last year and pumped £635 million into green energy schemes around the UK in its first five months, but just £580,000 has been invested in Scotland, in one boiler scheme.
Smaller community projects north of the Border seem set to be overlooked, despite a Scottish Government drive to generate the equivalent of all of Scotland’s electricity needs from green energy by 2020.
The bank’s bosses told MSPs on Holyrood’s economy committee yesterday that they had struggled to identify “profitable” schemes in Scotland, but insisted they had a “pipeline” of projects which would see future investment in Scotland.
Nationalist MSP Dennis Robertson said there appeared to be “opportunity and potential” for the bank in Scotland, but he added: “I wasn’t hearing something that’s actually there in the pipeline now in terms of investment.”
Edinburgh beat more than 30 cities around the UK to house the bank last year, with Scotland’s position at the “vanguard of the renewables revolution” among the reasons cited by Alex Salmond for the decision.
GIB chairman Lord Smith said yesterday: “Because we’re headquartered in Edinburgh, and as a Scot myself, I’ve been particularly keen to ensure that Scotland secures at least – if not more than – its fair share of investment capital.
“I’m afraid that we’ve not seen that come through yet.”
He insisted there were “positive prospects in the pipeline”.
But the bank’s operations director, Rob Comrie, was unable to tell MSPs how many of the “pipeline” schemes were likely to result in deals being struck.
The bank’s chief executive, Shaun Kingsbury, said: “Finding projects which are both green and profitable has been a challenge, particularly here in Scotland.”
The bank was established with funding of £3bn until March 2015 and a further £800m has been allocated for 2015-16.
Labour’s Hanzala Malik voiced concerns that smaller community-based projects were missing out. “You’re not really there for the small guy,” he said.
The status of the Edinburgh HQ was also questioned by Nationalist MSP Marco Biagi. Only 31 staff work in the Scottish capital on an average salary of £80,000, while the London set-up consists of 50 staff making £120,000 on average.
“That doesn’t strike me as what the average person in the street would think of as headquartered in Edinburgh with a branch in London – instead it looks a bit like the opposite,” the Edinburgh Central MSP said.