The National:

TODAY'S launch of the Scottish National Investment Bank marks the culmination of many years of campaigning by myself, by Common Weal and by many, many others. It’s been quite a journey from the first papers on principles, the more in-depth blueprints, the policy being rejected without caveat by the Scottish Government before winning unanimous favour among SNP members at their 2017 Spring conference. Unable to ignore it, the Government picked up the idea again and began the development process. We’re proud to have been a core part of those discussions – though we didn’t get everything we wanted out of them. Now, as we approach the end of 2020, the SNIB has launched and announced its first round of funding to M Squared Lasers. A company that, by sheer coincidence, I worked for in my pre-politics days in the laser industry.

The SNIB has the potential to be a game-changer for Scottish investment. Its mission-driven approach shall direct money to the places and sectors in Scotland that need it (rather than the ones that will make the most profit) and its “patient finance” philosophy shall ensure financial stability rather than the kind of banking that led to the worst excesses of the 2008 Financial Crash. However, there’s more to do to ensure that SNIB can meet those missions.

Right now, the SNIB can only spend the money it is given to them by the Scottish Government. £2 billion over ten years sounds like a lot but Scotland is going to have to invest more like £170bn to properly tackle the climate emergency and create a Green New Deal. We only have 24 years left to meet our own Net Zero targets and less than 10 years left to meet the IPCC’s deadline for making serious inroads on those targets. The Scottish Government must urgently petition the UK Government to give SNIB the similar Treasury dispensation as RBS has and allow it to be a publicly owned but fully operational bank able raise as much capital as it needs to do its job.

READ MORE: Laser firm is first to get Scots national bank investment

Campaigners won the argument for the bank to be advised by a Stakeholder Board from across Scottish society but as things stand they’ll only speak via Government Ministers. An equal tripartite structure of Bank, Ministers and Stakeholders gives the bank the best chance of remaining independent of political manipulation but also helps it resist decaying into “just” another investment bank run by investment bankers. The successes of the Citizens’ Assemblies have proven the case for the Scottish people to have more of a direct say in the decisions made around us.

Finally, investment in SMEs similar to this first announcement will be a core part of the bank but equally core must be investment in things that are financially less risky and socially much more valuable. We should build as many zero-carbon social houses as we need to give everyone a decent home. We should fund a network of public retail banks to ensure that no-one must ever fight to keep the “last bank in town” (if they still have even that). We must fund the development of publicly owned renewable energy and move away from the current policy of selling energy assets off to foreign investors as fast as we can.

And once we’ve done all that, we must think about the future of the SNIB. This is not an organisation for Christmas or a Parliamentary term, but a bank that should be a foundation of Scotland’s economy for centuries to come. We should not simply cast it free and let it slip, however unintentionally, into the same bad practices of other financial institutions. It must be bold and be allowed to be bold. It must be patient and must be given the time to show patience. Only if we invest in the bank and encourage it to reach its potential can it help Scotland reach ours.

Craig Dalzell is the head of policy and research at Common Weal