A flurry of announcements from the Scottish National Investment Bank has only raised fresh questions about the value of a costly institution which have alarming implications for a key element of the Scottish Government’s response to the energy transition.

Nicola Sturgeon confirmed plans to launch the SNIB in February 2018 when she said it could act as a cornerstone of the economy by providing the patient capital needed to support the development of the industries of the future.

Following the completion of a review of plans for the institution by a leading Scottish financial services figure, Benny Higgins, Ms Sturgeon was confident enough then about the potential of the bank to earmark £500m funding over the following three years. The review found there was a strong case to create what became SNIB even though the country already had a national investment bank.

This was created under an initiative launched by former SNP leader Alex Salmond in 2009 when he was First Minister. The preceding year the Government he led launched the Saltire Prize to encourage investment in wave power amid talk that Scotland could become the Saudi Arabia of the emerging marine energy business, only to see the scheme fall woefully short of expectations.

The Scottish National Investment Bank is now expected to be able to invest £2 billion of public capital in its first decade of operations. In April last year infrastructure funding specialist Eilidh MacTaggart was appointed to run the bank on a base salary of £235,000.

In a post made on LinkedIn last week, Mr Higgins made clear he thinks the new bank is on the road to success. Reflecting on a career that has included big jobs at giants such as Royal Bank of Scotland, he wrote: “I have had the privilege of working on many wonderful projects with extraordinary colleagues - the acquisition and integration of NatWest is one, and the creation of Tesco Bank is another. But I am most proud of the work on The Scottish National Investment Bank.”

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Amid the fallout from the pandemic and the threat posed by climate change the onus is on the Scottish Government to provide effective support for firms.

However, some three and a half years after Ms Sturgeon said the Government would move at pace to establish the bank signs that the organisation is helping to bolster the economy of Scotland remain in short supply.

After keeping economy watchers waiting until November last year to unveil its first investment – worth £12.5m in M Squared Lasers - the bank has completed a further seven deals since February. However, the funding commitments involved total just £108m.

The two latest investments made in Scottish companies will do little to persuade doubters that the bank is delivering anything that was not already being achieved under other funding schemes administered by Scottish Enterprise.

Last month SNIB announced it was providing £6m funding to support growth at Sunamp, which has pioneered the development of batteries that can be used to store heat. There is huge excitement about the potential of the products developed by Sunamp, which recently recruited a prominent US entrepreneur and former investment banker, Hank Torbert, as chairman.

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However, Sunamp had already won backing from a range of investors including some based overseas before SNIB supported the recent fund-raise. In November 2018 the old Scottish Investment Bank provided funding for Sunamp alongside private sector players such as Japanese utility Osaka Gas and Scottish angel investment syndicate PAR Equity.

Sunamp secured the latest funding weeks after the Scottish National Investment Bank made a £6.4m investment in tidal energy specialist Nova Innovation.

Edinburgh-based Nova hopes to develop a pioneering turbine manufacturing plant under a programme for which it won £2m Scottish Government backing before SNIB made its investment. It won Welsh Government support for another project.

Investors in the firm include former SSE chief executive Ian Marchant, who chaired Nova for seven years. Former UK energy minister Sir Michael Fallon recently became deputy chairman of Nova.

The new investment bank’s biggest funding commitment, worth £50m over thee years, was made in August in respect of a sustainable forestry fund launched by the London-based Gresham House asset management business.

The bank said its support would encourage other investors to back the fund, 60 per cent of which will be directed to Scotland. At a time when oil and gas giants such as Shell are talking about planting huge numbers of trees to help offset emissions, some might wonder if the public sector really needs to provide investors in woodlands with a helping hand.

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It is notable that the biggest commitment made by the investment bank previously was the £40m funding announced in February for the PfP Capital Mid-Market Rent Fund. The fund will be used by Places for People to invest in the provision of affordable rented housing. The Scottish Government provided £40m loan support for the fund when it was launched in 2018.

Other firms that have received smaller SNIB investments, such as insulation specialist IndiNature and internet of things firm R3 IoT, have also benefited from Scottish Enterprise support.The fact they have will reinforce the concerns that the bank has committed only a relatively small amount of money so far and has yet to show that it has added anything genuinely new to the funding mix.

Such concerns assume special importance given the fact the SNP Government made the launch of a £500m, 10-year, Just Transition Fund for the North East a centrepiece of the legislative programme it agreed in August with the Scottish Greens.

Friends of the Earth Scotland said last month it was not clear what the £500m would be spent on adding: “A fund to support the North East is important, however there is no indication of how Just Transition will be funded elsewhere.”

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Oil and gas sector specialists have warned that Nicola Sturgeon has jeopardised investment in new projects with her calls for the UK Government to reassess licences. With gas prices at record levels, the consequences for any shortfalls in UK production will probably be felt by consumers.

Only last month auditor general Stephen Boyle warned Scotland “remains riven by inequalities” as he criticised a “major implementation gap between policy ambitions and delivery on the ground”.