The new Business Secretary, Vince Cable, has been urged to act on his view of the banking system by curbing the unethical investments of the Royal Bank of Scotland (RBS).
Cable, a well-known critic of banking excesses, is one of the most senior Liberal Democrats to join the government after his party formed a coalition with the Conservatives.
The World Development Movement (WDM), People & Planet and PLATFORM issued a joint statement yesterday (12 May) congratulating Cable on his appointment.
The three groups suggested that he can make his mark by speedy action on RBS investments. The majority stake in RBS is now owned by the taxpayer. The campaigners argue that the government should use its stake to prevent investments in high-impact oil and gas extraction and to put the money into sustainable projects.
RBS has faced particular criticism for its involvement in tar sands extraction, which campaigners say is having devastating impacts on indigenous communities in Canada as well as on the climate.
"We are pleased to hear that Vince Cable, who has consistently spoken out in favour of regulating the banking sector will be part of the new coalition government,” said WDM's Director, Deborah Doane. She pointed out that the Liberal Democrats “committed at their Party Conference last year to end taxpayers' support for RBS' investments in tar sands extraction”.
The campaigners welcomed government plans to launch a green investment bank. They said they were hopeful that the Liberal Democrats would drive forward plans to raise money through a tax on speculative banking transactions.
But PLATFORM Co-Director Kevin Smith said that, “The new government's plans for a green investment bank will be dramatically undermined if it continues to allow RBS to use public money to support and expand carbon intensive industries and operations around the world”.
He added, “Vince Cable needs to ensure that the reform of the banking sector involves addressing environmental as well as financial sustainability”.
The campaigners point out that the new government could gain a good green reputation from the outset if they act on RBS investments quickly.
“Prompt action to ensure that public money does not go into tar sands in Canada or new coal-fired power stations will inspire confidence that this new government is serious about creating a low carbon future,” said Ian Leggett, director of People & Planet, Britain's largest student campaigning network.
Doane added, “Introducing these policies from the outset would be a real commitment to cleaning up the mess that the financial crisis has left Britain and the world in”.