Andrew Bailey calls for green recovery, but BoE must lead by example

London, 5 June 2020 – Research and campaign group Positive Money has welcomed Bank of England (BoE) governor Andrew Bailey’s calls for a green recovery from the Covid crisis, but urges Britain’s central bank to lead by example.

Bailey is among current and former central bankers writing in The Guardian today calling for the response to the Covid pandemic to green the global economy and ‘build back better’. The authors argue that “stimulus packages can be more ambitious”, and suggest that state financial support should be linked to climate-related conditions laid out by the Task Force on Climate-related Financial Disclosures (TCFD).

But, as Positive Money points out, the Bank of England’s response to the coronavirus crisis so far has not been green, and has actually been fuelling the climate crisis. It was revealed yesterday that the BoE’s Covid Corporate Financing Facility (CCFF) has seen the central bank offer generous financial support to a host of environmentally damaging companies, including £1.8bn for airlines and £750m to oil companies, with no green conditions attached to these bailouts.

The BoE also announced an additional £10bn of corporate QE in March, which remains skewed towards fossil fuel companies, despite Andrew Bailey’s pledge to green the Bank’s asset purchases as “a priority”. 

Fran Boait, executive director of Positive Money, said:

“It is welcome that central bankers are recognising the threat the climate crisis poses, and the opportunities to build back better, but there is so much more they can do to lead by example.

“As a start the Bank of England must exclude fossil fuel companies from its corporate QE programme, and consider what climate conditions could be attached to its corporate bailout scheme. It’s time for our central bank to put its money where its mouth is.”

Notes

1. Positive Money will be publishing a report which explores how socially and environmentally irresponsible businesses are benefiting from the CCFF, including further names not included in the list published today and a more detailed sectoral analysis of where funds are going, later this month.

2. Positive Money campaigns for a money and banking system which supports a fair, democratic and sustainable economy. Set up in the aftermath of the financial crisis, Positive Money is a not-for-profit company funded by charitable trusts and foundations, as well as small donations from its network of over 65,000 supporters. www.positivemoney.org

3. For any questions or for interviews with a spokesperson please contact simon.youel@positivemoney.org.uk or 07817765517