14:45 Kevin Hollinrake (Conservative)

I say that because there is another challenge ahead, and this is the second requirement that I am going to refer to—there are only three, Mr Pritchard. This is another APPG initiative—Bankers for NetZero. It is a world-leading initiative; we are now one of the key chapters in international financial regulation in terms of how we decarbonise our economy and how we bring the UK finance industry together with business and provide the capital to decarbonise—that will be a critical part of the conversation. We are going to have to do something at some point to provide capital to businesses so that they can decarbonise, because significant investment will be required in lots of businesses to be able to do that. We do not want to simply pull the plug in terms of SMEs that could contribute towards decarbonisation. We should not be thinking, “Oh, they’re businesses that operate in old ways, using what is probably less green technology, and therefore we’re not interested in them. We’re going to pull finance from those people and go to new businesses.” That would be a significant mistake: the scale would probably be a multiple of two or three times what it was during the financial crisis when we pulled money from certain businesses. We should be allowing these businesses to invest in decarbonisation.

We will have to ensure that capital is made available, probably at a cheaper rate, a discounted rate, to decarbonise such businesses. For example, a term funding scheme for net zero, which the report on mainstreaming net zero proposes, is something that we should consider. We must get that right to ensure that all lenders can access those things. The Conservative Environment Network, of which I am proud to be a member, is also looking at this, and we had a conversation earlier today. It is very clear that we need finance for environmental reasons as well as for economic reasons. I could not put it better myself. The Conservative Environment Network is also very worried about divestment.

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15:04 Marion Fellows (Motherwell and Wishaw) (SNP)

The chair of the APPG on fair business banking, the hon. Member for Thirsk and Malton (Kevin Hollinrake), followed—I apologise to him for my not perfect attendance at that important APPG—and gave us a quick run through a number of reports produced by the APPG, all of which were interesting and relevant to the subject we are talking about. During this time of COP26, I especially take on board his words about decarbonisation and small businesses looking forward environmentally. That could well become really important and another block to gaining finance in the future.

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15:31 The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)

On the British Business Bank and its objectives, my hon. Friend the Member for Thirsk and Malton talked about delivering net zero. Indeed, we have implemented a net-zero objective within the British Business Bank, and therefore everything it does has to adhere to that objective.

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15:50 Peter Gibson

I am incredibly grateful to my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), who has been an incredible support to me since I arrived in this place. I am grateful for all he does with the APPG on fairer business banking. He was right to highlight the need to tackle the issue of decarbonisation with the banks.

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