Lib Dems calls for National Infrastructure Bank
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Speaking at The Civilisation Congress 2009 today, Liberal Democrat shadow chancellor, Vince Cable has set out Liberal Democrat proposals for a National Infrastructure Bank.
He says the UK has one of the worst records for infrastructure investment in the OECD, and argues that there is an urgent need for a step change in infrastructure investment. Cable says Investment in infrastructure would create jobs, increase competitiveness, promote environmental sustainability and boost the economic recovery.
He says: “I believe that what we need is a mechanism for reducing the cost of capital - through government guarantees - while tapping in to private savers’ demands for long-term investment. That is why I am proposing the creation of a National Infrastructure Bank.
“The idea of an Infrastructure Bank is not new. Bodies like the European Investment Bank already do this on an EU level. There are already institutions in the UK, albeit in a fragmented form with a great deal of expertise in this area. But what I am suggesting would bring the current government facilities together rather than reinventing the wheel.
“The government has already announced Infrastructure UK but the last thing that we need is yet another advisory body talking shop.”
He says a National Infrastructure Bank would tap into the demand from institutional investors - pension funds and insurance companies - for long-term investment opportunities and from retail investors.
He adds: “Government would provide guarantees but the National Infrastructure Bank would be professionally managed and make investment decisions on an objective, project by project basis. It would not be a nationalised industry.”
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