Chancellor shrinks public funding pot for Britain’s new National Wealth Fund
Rachel Reeves has cut the size of public funding for Britain’s new National Wealth Fund by £1.15bn.
The Chancellor announced she is rebranding the UK Investment Bank as the National Wealth Fund (NWF), and giving it total financial firepower of £27.8bn.
That is up from the institution’s previous total of £22bn, indicating Ms Reeves has given it an extra £5.8bn – not the £7.3bn which Labour had previously promised to put into the fund.
A spokesman for the Treasury said £7.3bn of public money would still be spent on infrastructure but would not all go via the fund, in a change of tactics.
The Treasury spokesman said: “All of the £7.3bn will be spent on the five sectors in the manifesto; ports, gigafactories, steel, carbon capture and green hydrogen. We are simply making sure that the funding can best meet the needs of those sectors where the NWF’s might not be the best fit.”
In its manifesto, Labour said the creation of a wealth fund would help bring in private sector investment to more than match that put in by the Government.
It said: “Capitalised with £7.3bn over the course of the next Parliament, the National Wealth Fund will have a remit to support Labour’s growth and clean energy missions, making transformative investments across every part of the country.
“The fund will have a target of attracting three pounds of private investment for every one pound of public investment, creating jobs across the country.”
It came as the Government announced £63bn had been “committed” to investment in the UK by private businesses.
Ministers said the total was “more than doubles the £29.5bn committed at last year’s Global Investment Summit”.
However, this includes significant sums that had previously been announced, but which companies have-announced or more firmly backed.
Among these is Blackstone’s £10bn investment in a data centre in Blyth, Northumberland, which had initially been flagged when it bought the former Britishvolt site in May under the previous Government.
In other cases, new financial figures have been published for long-planned investment projects.
These include the £2.5bn investment by CyrusOne, a data centre developer which first applied for planning permission on its UK sites in 2022. Similarly CloudHQ, which is building a £1.9bn data centre campus in Didcot, first applied to construct the site six years ago.
