New chancellor launches National Wealth Fund
New chancellor launches National Wealth Fund
The new government is planning to create a National Wealth Fund to stimulate private sector investment backed by £7.3bn in funding through the UK Infrastructure Bank.
The Chancellor, Rachel Reeves and business secretary, Jonathan Reynolds have instructed officials to immediately begin work to create the new National Wealth Fund by bringing together the work of the UK Infrastructure Bank and the British Business Bank to unlock private sector investment to drive growth.
A taskforce has been set up chaired by the head of the Green Finance Institute, Dr Rhian-Mari Thomas, and other members including former Bank of England governor Mark Carney, Barclays CEO CS Venkatakrishnan, Aviva CEO Dame Amanda Blanc and large institutional investors.
Under the plans, the National Wealth Fund will bring together key institutions and will target investors in a bid to ‘mobilise billions more in private investment and generate a return for taxpayers.’
As part of the National Wealth Fund, reforms will be made to the British Business Bank, which is overseen by the Department for Business and Trade.
As one of her first actions, the Chancellor has tasked the Treasury to engage with industry, government departments and the UK’s public finance institutions to rapidly set detailed plans in motion. The development of the National Wealth Fund will examine the case for bringing together bodies from across the UK’s public finance institutions with further details to be set out ahead of the government’s international investment summit later in the year.
The government will bring forward new legislation when parliamentary time allows to put the National Wealth Fund into statute, making it a permanent institution.
The fund will also work with local partners including mayors to bring together a finance and investment offer that supports the needs of local areas and catalyses growth across the country. The British Business Bank, which supports SMEs to grow by improving their access to finance, has unlocked £12.4bn of finance, and in 2023 funded over 23,000 UK businesses supporting the creation of over 39,000 jobs.