Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of local climate bonds in funding local environment projects.

The Government considers current funding options for local authorities to pursue environmental projects to be appropriate. Local authorities have full, independent control over their borrowing choices and are free to issue local climate bonds if they wish. It is for local authorities to determine the most appropriate financing mechanism for their projects.

The Government provides accessible, low-cost lending via the Public Works Loan Board which can be used to finance environmental projects, and environmental projects could also be funded via the UK Infrastructure Bank where they meet the bank’s mandate.

In addition, the UK Green Financing Programme has raised £16bn to date, which will be used to finance projects that help tackle climate change and other environmental challenges – some of which local authorities may benefit from.