Investing for the future: Why we need a British Investment Bank

Article

This report presents a detailed blueprint for what a British Investment Bank should look like in order to be fully effective in filling a gap in the UK banking system.

The idea of such a Bank has been around for a number of years, but only in the last five has it achieved any prominence in public debate. In September the business secretary, Vince Cable, announced tentative plans for a British Investment Bank.

IPPR's report examines the models provided for national investment banks by international case studies and sets out the main lessons that emerge.

It says that a British Investment Bank should have the following features:

  • Operation: The Bank should be 100 per cent state-owned but there must be a clear dividing line between the role of government and the activities of bankers in making lending decisions
  • Scope: A fully fledged British Investment Bank should be able to invest in infrastructure projects and to provide long-term financing for small and medium-sized businesses across the whole economy
  • Size: The government should inject an initial £40 billion of capital over four years into the Bank, and the Bank should be allowed to raise funds on capital markets up to a leverage ratio of 2.5:1 (that is, up to an initial £100 billion).

Related items

  1. Women coworking in office, looking at computer screens displaying code, collaborating on project using multimodal AI chatbot technology in software development

    Locked in: A realist's agenda for digital sovereignty

    Digital sovereignty has never been more urgent.
  2. A man stands on a tram during the day holding his phone and wearing headphones

    Empowering people to hold tech accountable

    We need reform to remove structural barriers to people and civil society taking direct action against tech companies in UK courts – putting more power in the hands of people.
  3. The Home Office building in London

    Earned settlement: Decision time

    The government is imminently due to announce plans for a new model of ‘earned settlement’. These are expected to represent the most significant reforms to indefinite leave to remain in a generation.