National Wealth Fund boss reveals 'more bang for our buck' strategy as UK support trails France and Germany
The Leeds-based National Wealth Fund can get “more bang for our buck” through increased collaboration with other public financial institutions such as Sheffield’s British Business Bank, the CEO of the former organisation has said.
The National Wealth Fund (NWF) has £27.8bn of Government funding allocated to the organisation up to 2031 to invest in infrastructure projects designed to drive economic growth, strengthen national resilience, and accelerate the transition to clean energy.
But its funding is substantially below that of similar organisations in France and Germany, which each invest around one per of national GDP. For the UK to match this, the NWF would need to be investing £21bn a year – almost four times its current level.
Oliver Holbourn, who took over as CEO in November, told The Yorkshire Post that closer collaboration with other public financial institutions is part of helping the fund punch above its weight.
He said: “There are a lot of sovereign wealth funds who are larger than us. On the one hand, you know, £28 billion is an enormous amount of money and enormous responsibility, and we have to take that incredibly seriously.
"On the other, vis-a-vis the GVA of the UK, it's relatively modest. We think to deploy £28 billion well is going to take another three to four years.
"We've got a reasonable amount of runway but one of the ways that we get more bang for our buck is working alongside the other public financial institutions and we are, genuinely in the spirit of complete collaboration.
"I'm very lucky, I have a number of leaders across other public financial institutions, whether it's UK Export Finance, British Business Bank, Great British Energy, Great British Nuclear, Scottish National Investment Bank. We know them all, and we are not precious, we are keen to collaborate.”
He highlighted a recent offshore windfarm project in Scotland also backed by GB Energy and Scottish National Investment Bank.
"We're very happy to work with people to unlock problems together, and I think that's how we probably add even more weight than just deploying our capital.”
He said work is taking place to give political and business leaders “one face” in which different institutions direct prospective partners to the most relevant organisation when approached.
A recent Treasury Select Committee report suggested the Government re-examine the case for merging the NWF and the British Business Bank. A subsequent response from the Government said a previous review had concluded the current arrangements are “well-positioned to deliver government priorities, with opportunities to enhance impact through improved coordination”.
When asked about the merger issue, Mr Holbourn said: “When I came into the role, I took the view that it was settled. Somebody may open it again in the future.
"But I think what we, as institutions, what we're just really keen to do is collaborate for the benefit of the customer. As long as hopefully we can prove that we can collaborate well perhaps those questions won't arise in future.
"Every country sort of sets themselves up a little bit differently, and I don't think there is any right or wrong. It's just about are you effectively helping your customers, whoever they are? In our case, it's generally regional elected leaders and company and business owners and project sponsors.
"If you're doing right by your customers, then they will want to do more business with you. If they want to do more business with you, then in three or four years' time, we will hopefully be able to go to HM Treasury and say ‘We've done what you've asked, woudl you'd like us to do more or what next?’”