Finance consolidation advocated by National Wealth Fund leader
The UK government has confirmed that there is no publicly announced consolidation of the UK Infrastructure Bank and the British Business Bank into a single National Wealth Fund or equivalent entity as of mid-2025. The separate institutions continue to operate as part of the government's broader economic and infrastructure strategy.
The Spending Review 2025, announced in July, confirmed additional financial transactions funding for expanding the financial capacity of the British Business Bank and Great British Energy. However, it did not mention merging these institutions or forming a National Wealth Fund consolidation.
Fiscal consolidation and public finance management remain a focus in the UK, with challenges around deficit reduction and investment needs. Discussions about consolidation at the government or Bank of England level often revolve around accounting and reporting rules, but these do not indicate active structural consolidation of public financial institutions like the UK Infrastructure Bank or British Business Bank into a unified fund.
There have been debates regarding the independence and accounting treatment of government-related financial institutions, but these discussions are distinct from a policy to consolidate public finance institutions into a National Wealth Fund.
Louis Taylor, the chief executive of the British Business Bank, stated that the government understood, after a few months in power, what the process of creating a national wealth fund would involve. John Flint, the former chief executive of HSBC, urged the government to consider consolidating public finance institutions. He mentioned that having multiple sub-scale public finance institutions with similar organizational challenges is not the most efficient way to operate.
The National Wealth Fund (NWF), created by Labour and announced on July 9, 2024, has a chief executive named John Flint, who is set to exit his role in the summer. Experts have raised concerns about the naming of the body as a "national wealth fund," with academics last month branding the title a "misnomer."
Despite the ongoing discussions, the UK Infrastructure Bank and British Business Bank remain separate entities, with the government continuing to use these institutions independently to support public investment and economic growth within ongoing fiscal constraints. Minister James Murray sidestepped the question on the bank's exclusion from the NWF, while Lord Spencer Livermore, the financial secretary to the Treasury, referenced grouping the British Business Bank in the NWF as "something they have considered."
The Chancellor Rachel Reeves and business secretary Jonathan Reynolds instructed officials to align the UK Infrastructure Bank and the British Business Bank, but Labour's focus has since shifted to access to finance and increasing the financial capabilities of these institutions rather than merging them into a single entity. The UK Infrastructure Bank is not set to become the National Wealth Fund, as initially intended.
- Discussions about the National Wealth Fund often involve consolidating public finance institutions, with John Flint, the former CEO of HSBC, advocating for such a move.
- The UK Infrastructure Bank and British Business Bank, however, continue to operate separately as part of the government's broader economic strategy.
- Despite the challenge of keeping multiple public finance institutions efficient, the government hasfocused on expanding the financial capacity of the British Business Bank and Great British Energy, rather than merging them.
- The announced National Wealth Fund, created by Labour, has a separate structure and purpose, with ongoing debates about its title and independence from the existing financial institutions in the UK economy.
