House of Lords Committee inquiry into UK’s relationship with the European Investment Bank post-Brexit
The House of Lords EU Financial Affairs Sub-Committee has launched an inquiry into the UK’s future relationship with the European Investment Bank (EIB) and the potential consequences of the UK losing access to EIB funding (including funding from the European Investment Fund (EIF), of which the EIB is the majority shareholder).
The Committee will consider the options for future participation in the EIB and what alternatives could be established, such as the incorporation of a national promotional bank or the expansion of the remit of the British Business Bank to include the infrastructure and venture capital funding currently provided by the EIB and EIF.
The Committee invites interested individuals and organisations to submit evidence to the inquiry by 14 September 2018. The Committee aims to report to the House in December, after public hearings in the autumn. The report will receive a response from the Government and will be debated in the House.
Funding from the EIB has been an integral part of many large infrastructure projects in the UK over the years, for example, Crossrail, the M25 Road Widening Project and the Thames Tideway Tunnel. The EIB also invests in a broad spectrum of smaller infrastructure projects across many sectors. In 2015, the UK received £5.6 billion from the EIB, which supported £16 billion of overall investment.
When the UK exits the EU it will need to agree the terms of its exit and/or future relationship with the EIB: in particular, regarding the treatment of existing loans to UK firms and the guarantee of EIB liabilities by the UK. A cessation of EIB and EIF financing will lead to a significant funding gap for UK projects if alternative arrangements are not put in place. Despite UK projects being eligible to receive EIB funding until the UK exits the EU, the amount of such funding has reduced since the referendum, indicating a need for short-term as well as long term solutions.
Further details of the Committee’s inquiry are available here.