Rishi Sunak announces first UK green gilts – response

Today, Chancellor Rishi Sunak announced plans to launch the UK’s first green government bonds (‘gilts’), following the lead of 16 other countries including Germany and Sweden. Research and campaign group Positive Money welcomed this as a step in the right direction, and called for the proceeds of these bonds to fund largescale public investment in a fair green transition.

Fran Boait, executive director of Positive Money, said: 

“We desperately need more green public investment if we are to have a fair, green transition, so it’s positive that the government has signalled that it is finally taking this more seriously, by issuing green gilts for the first time.

“Markets are currently rife with ‘greenwashing’, and we’ve seen the farce of high-carbon corporations such as oil companies and airports issuing supposedly ‘green’ bonds. We need to make sure that these green government bonds are actually used for ambitious investment in a just green transition.

“The Bank of England could also help support a fair green recovery by buying up green gilts through its quantitative easing programme, which is currently skewed towards high-carbon companies, including the likes of Shell and BP. The Bank could divest from polluting companies and reinvest funds in these new green government bonds.”

Notes

1. Chancellor sets out ambition for future of UK financial services: https://www.gov.uk/government/news/chancellor-sets-out-ambition-for-future-of-uk-financial-services 

2. The Chancellor’s announcement comes after the Bank of England announced this morning that it will hold climate stress tests in June 2021: https://www.bankofengland.co.uk/speech/2020/andrew-bailey-speech-corporation-of-london-green-horizon-summit 

3. The Financial Conduct Authority (FCA) also announced today that they will be introducing new rules requiring premium listed companies to disclose climate risk consistent with the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD): https://www.fca.org.uk/news/speeches/green-horizon-summit-rising-climate-challenge 

4. 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. https://positivemoney.org/  

5. For more information or to arrange a briefing/interview with a spokesperson please contact press@positivemoney.org.uk or Simon Youel on 07817765517