Committees

Can the National Wealth Fund move the dial on growth? New inquiry launched

24 March 2025

The Treasury Committee is launching an inquiry into the Government’s National Wealth Fund (NWF), aiming to understand if it has the tools and backing to drive meaningful growth in the UK economy.

The NWF, launched in October 2024, is owned by HM Treasury but operates wholly independently. The organisation has to drive private investment and generate economic growth.

Last week, the Treasury published the Statement of Strategic Priorities, confirming the NWF’s priority sectors for investment as clean energy, advanced manufacturing, digital technologies and transport.

The inquiry will look at how the NWF is likely to differ from its predecessor, the UK Infrastructure Bank, as well as what steps will be taken to ensure the NWF is assessing value-for-money before making investment decisions.

The Committee is also seeking to understand how the NWF will operate given its independent status, particularly how it will interact with other parts of the public sector when it decides to invest in major infrastructure.

Chair comment

Chair of the Committee, Dame Meg Hillier, said:

“A sovereign wealth fund which can encourage private investors to back projects and funnel capital into emerging sectors is a logical way of trying to move the dial on economic growth.

“However, if the National Wealth Fund veers off course by choosing the wrong sectors for investment, making operational errors or misjudging the appetite of the private sector, it can also end up being an extremely poor use of taxpayer money at a time when the public purse is incredibly stretched.

“We must get this right and our Committee will be pressing the Government to make sure they are on firm footing.”

Call for evidence

The Committee’s call for evidence is now open  until Monday 21 April. Full terms of reference are as follows:

  • How successful is the National Wealth Fund likely to be in (1) mobilising private investment and (2) stimulating economic growth?  
  • The Chancellor has given the National Wealth Fund two strategic objectives: (i) supporting regional and local economic growth and (ii) tackling climate change.  How will these two objectives work together? 
  • The Chancellor’s strategic direction sets  clean energy, advanced manufacturing, digital technologies, and transport as the priority sectors for the National Wealth Fund. Are these the right priority sectors? Should others have been included? 
  • How attractive is the National Wealth Fund likely to be as a partner for the private sector? Is the private sector sufficiently aware of the opportunities available within the National Wealth Fund? 
  • How can the National Wealth Fund ensure that it is crowding in rather than crowding out private sector investment? 
  • What proportion of public infrastructure is likely to be funded by the National Wealth Fund? What projects should be funded by the National Wealth Fund vis a vis normal departmental spending?
  • How similar is the National Wealth Fund to its predecessor, the UK Infrastructure Bank? What lessons can the National Wealth Fund learn from the UK Infrastructure Bank? 
  • What degree of independence will the National Wealth Fund have from HM Treasury?
  • What can the National Wealth Fund learn from international counterparts which have similar objectives or functions? How will the National Wealth Fund work with its counterparts in the devolved nations: the Scottish National Investment Bank, the Development Bank of Wales and the Northern Ireland Investment Fund?
  • By what criteria should the National Wealth Fund be judged? 
  • What are the risks inherent in the National Wealth Fund? What are the risks that National Wealth Fund will lead to the Government funding either poor value for money projects and/or the Government having to spend more than anticipated due to defaults on the loans it is guaranteeing? 
  • Do we need to accept that some of the projects funded by the National Wealth Fund will fail or be poor value for money? What kinds of failure does the Government need to tolerate in projects funded through the National Wealth Fund? 
  • Does the accounting treatment of the National Wealth Fund in the Government’s new debt measure, Net Financial Sector Liabilities, lead to any perverse incentives in terms of giving preference to projects funded by the National Wealth Fund vis a vis Government spending?

Please note when submitting evidence, it is not necessary to answer every question in the terms of reference set out below. 

Further information

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