Three pressure groups behind a campaign to turn the Royal Bank of Scotland (RBS) into a ‘green’ bank, have today taken legal action against the Government’s recent decision to provide billions more tax-payers’ money to the bank.
The three groups – the World Development Movement (WDM), People & Planet and PLATFORM – claim RBS
investments are having a damaging effect on the environment and want to see the bank redirecting its investments to support
renewables and decarbonisation. They are behind a report, along with Friends of the Earth (FoE) Scotland, which puts the case for RBS being turned into a ‘
Royal Bank of Sustainability’.
Today, the three groups have taken their case to the High Court, claiming the Treasury’s decision last November to provide the publicly owned
RBS with a further £25 billion is unlawful.
The groups, which have already taken the Treasury to the High Court over RBS last year, say they have taken today’s action because they believe their case has been strengthened because of Treasury “hypocrisy” over its funding criteria and bankers' bonuses.
They point out that under Treasury guidance, an assessment needs to take place on the likely impact bail out money will have on human rights and the environment. One of reasons given by the Treasury for not putting restrictions on how public money invested in RBS is spent in a way consistent with its own commitments on human rights and climate change is that such a restriction would be harmful to the “financial stability” of the bank. The campaigners argue this position is inconsistent with the Treasury’s recent stance and intervention over RBS staff bonuses.
A condition of RBS receiving the November cash injection under the Asset Protection Scheme was that it would increase lending to businesses and homeowners and not pay cash bonuses to staff earning over £39,000. The campaigners say a similar condition could and should have been imposed on RBS in relation to its investments in projects and companies, which are harmful to the environment and human rights.
“It is difficult to understand why the Treasury can order RBS to increase its lending to small businesses and home owners or curb bonuses but believe it would be unlawful for it to tell RBS to phase out its lending in hugely controversial tar sands, and investing in low carbon projects instead,” said Deborah Doane, director of WDM. “This is hypocrisy on a grand scale. The Treasury has shown that is has the power, if not the will, to intervene in RBS’ lending for the public good."
“For the second time in a year we are compelled to take the Treasury to court because of the way it is managing the Royal Bank of Scotland,” added Ian Leggett, director at People & Planet. “RBS is the dirtiest bank in the UK. It has a long track record of financing projects and activities that will
increase global carbon emissions, make
climate change more likely and are destroying precious habitats. The Treasury has the power to require RBS to change - but its consistent failure to do so indicates a total blind spot in Treasury when it comes to responsible investment."
The groups says in the UK alone, RBS is behind a £115 million loan to coal operator Hargreaves Services, which plans to extract seven million tonnes of coal by developing one of the largest opencast coal mines in the country at Tower Colliery in South Wales.
The groups first launched legal action in June last year over the initial bail out, but were blocked by the High Court. The groups lodged an appeal at the Court of Appeal, which will be heard on February 19.
Related News:
Green Banking NewsClimate Change NewsRelated Links:
www.peopleandplanet.orgwww.rbs.co.ukwww.wdm.org.ukwww.platformlondon.orgwww.foeeurope.orgwww.hm-treasury.gov.uk