Government ministers are in the glare of Whitehall spending watchdog the National Audit Office (NAO) as the Green Investment Bank privatisation drags on, City A.M. has learned.
With Australian investment bank Macquarie hopeful of clinching a deal soon, the government sale has come under intense scrutiny from politicians in recent weeks.
MPs, led by the Green Party’s Caroline Lucas, became particularly concerned after reports suggesting Macquarie was planning to asset-strip the Green Investment Bank.
City A.M. has learned that Lucas wrote to Sir Amyas Morse, comptroller and auditor general of the NAO, to express her concerns last month.
In a reply letter, seen by City A.M., Morse acknowledged Lucas’ concerns and noted they were shared by others, including the Environmental Audit Committee and the Scottish government.
He said the NAO was “monitoring the sale process closely” and will likely “undertake a value for money study of the Green Investment Bank at the conclusion of the sale process, however it concludes”. Morse also noted that the NAO’s definition of value for money would not merely focus on the amount of money obtained for the asset but also “the achievement of the bank’s green purposes”.
“We would expect such a study to cover the areas you have raised as concerns, and in particular: how the track record of the buyers was considered through the sale process; the governance structure; the creation of the ‘special share’; and the value obtained for the taxpayer through the intervention, including the outcome of the sale process,” he said.
“UK Government Investments, the government shareholder which is undertaking the sale, is aware that we are monitoring the sale process closely and that any review of the transaction would consider factors beyond the price achieved for the bank. We understand that ministers are also aware of this.”
Elsewhere, it emerged today that Macquarie has attempted to woo MPs concerned about the sale with emails talking up its green credentials.
One part of the email said:
In meeting the responsibilities that come with owning and managing public assets, Macquarie and investors in Macquarie-managed funds have a strong track record of ongoing capital investment to support operational growth. The operational and service improvements that have been delivered consistently over time give regulators and governments confidence in Macquarie’s ongoing stewardship.
A rival bidder to Macquarie, Sustainable Development Capital, remains another option for the government.