Creation of the UK Infrastructure Bank

Public Accounts Committee Closed Inquiry
Opened: 12 Oct 2022 Closed: 13 Apr 2023 Parliament page
In June 2021, HM Treasury launched the UK Infrastructure Bank (UKIB) with the aim of encouraging private finance alongside public investment to achieve two strategic objectives: helping to tackle climate change and supporting regional and local economic growth. UKIB is a publicly owned company with the Treasury as sole shareholder. … Read more
5 Recommendations
18 Conclusions
1 Report
1 Oral session
3 Letters
1 Event
Activity timeline 6 events
12 Apr
2023
Report published
23 Feb
2023
Correspondence
25 Jan
2023
Report published
22 Nov
2022
Correspondence
8 Nov
2022
Correspondence
7 Nov
2022
Oral evidence
Oral evidence sessions 1 session
7 Nov 2022
View on parliament.uk
Creation of the UK Infrastructure Bank
David Lunn · Department of Business and Trade James Bowler CB · HM Treasury John Flint · UK Infrastructure Bank Philip Duffy · Environment Agency Tim Jarvis · Ofgem
Recommendations & Conclusions
23 results
2 Recommendation
Thirty-Fourth Report - The Creatio…
The Treasury and the Bank have not yet put in place the conditions necessary for...
The Treasury and the Bank have not yet put in place the conditions necessary for the Bank to be a successful and long-lasting institution. The government wants the Bank to be a “long-lasting institution”, providing financing for infrastructure projects well … Read more
HM Treasury
View details
3 Recommendation
Thirty-Fourth Report - The Creatio…
We are not convinced the Bank has a strategic view of where it best needs...
We are not convinced the Bank has a strategic view of where it best needs to target its investments. The Bank’s 10 deals to date have mostly been relatively conventional investments, including seven loans. While the Bank’s early deals reflected … Read more
HM Treasury
View details
4 Recommendation
Thirty-Fourth Report - The Creatio…
The Bank’s advisory function remains in the early stages of development and uncertainty remains on...
The Bank’s advisory function remains in the early stages of development and uncertainty remains on how it will be funded and how smaller local authorities will benefit from its activities. The Treasury intends the Bank to provide advisory services to … Read more
HM Treasury
View details
5 Recommendation
Thirty-Fourth Report - The Creatio…
Maximising the Bank’s impact will depend on close cooperation with government departments, but it has...
Maximising the Bank’s impact will depend on close cooperation with government departments, but it has not yet worked out how this will operate in practice. The Treasury intends the Bank to play an important role in achieving key elements of … Read more
HM Treasury
View details
6 Recommendation
Thirty-Fourth Report - The Creatio…
The Bank has not fully set out how it will measure and report its performance,...
The Bank has not fully set out how it will measure and report its performance, and how it will evaluate its activities to ensure that it can demonstrate additionality. Evaluation is crucial to ensuring the Bank delivers additionality and that … Read more
HM Treasury
View details
1 Conclusion
Thirty-Fourth Report - The Creatio…
On the basis of a Report by the Comptroller and Auditor General, we took evidence...
On the basis of a Report by the Comptroller and Auditor General, we took evidence from HM Treasury (the Treasury) and the UK Infrastructure Bank (the Bank) on the creation of the Bank.1
HM Treasury
View details
7 Conclusion
Thirty-Fourth Report - The Creatio…
The Treasury told us it took a “phased approach” to the Bank’s set-up with “checks...
The Treasury told us it took a “phased approach” to the Bank’s set-up with “checks and balances in place” to ensure it would be delivering value for money to the taxpayer.17 The Treasury seconded officials to key Bank posts, and … Read more
HM Treasury
View details
8 Conclusion
Thirty-Fourth Report - The Creatio…
The Treasury intends the Bank to be a “long-lasting institution” providing financing for infrastructure projects...
The Treasury intends the Bank to be a “long-lasting institution” providing financing for infrastructure projects well into the future.21 This label echoes the Green Investment Bank’s status as an “enduring institution,” which was subsequently sold to the private sector five … Read more
HM Treasury
View details
9 Conclusion
Thirty-Fourth Report - The Creatio…
The Treasury provided the Bank with £22 billion in capital to cover the first five...
The Treasury provided the Bank with £22 billion in capital to cover the first five years of operation; beyond then, it expects the Bank to be self-financing. We asked whether this was a realistic target. The Bank told us it … Read more
HM Treasury
View details
10 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank’s capacity to make complex and innovative deals is limited by the lack of...
The Bank’s capacity to make complex and innovative deals is limited by the lack of suitably qualified staff members. The Bank has worked with Treasury to complete recruitment to key senior leadership positions that were not filled at launch. At … Read more
HM Treasury
View details
11 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank told us that, as a result of having insufficient skills and expertise, it...
The Bank told us that, as a result of having insufficient skills and expertise, it has only entered into relatively low risk, more straightforward investment deals, as those are the only deal types it is comfortable delivering with the available … Read more
HM Treasury
View details
12 Conclusion
Thirty-Fourth Report - The Creatio…
The costs associated with setting-up the Bank as a separate institution, such as procuring new...
The costs associated with setting-up the Bank as a separate institution, such as procuring new IT systems, make it a more costly option than alternatives such as extending the remit of existing bodies.31 The Bank told us it is working … Read more
HM Treasury
View details
13 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank told us it is currently developing several Key Performance Indicators (KPIs) to measure...
The Bank told us it is currently developing several Key Performance Indicators (KPIs) to measure its success. For its two policy objectives, these include carbon emissions abated, jobs created and productivity. The Bank told us it expects to abate 2 … Read more
HM Treasury
View details
14 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank recognises there could be tensions between its two policy objectives.37 For example, there...
The Bank recognises there could be tensions between its two policy objectives.37 For example, there is a risk that a project could promote local growth but be harmful to the environment. The Bank told us that for any investment that … Read more
HM Treasury
View details
15 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank has developed arrangements for reporting performance and emerging issues to its shareholder (the...
The Bank has developed arrangements for reporting performance and emerging issues to its shareholder (the Treasury), through the shareholder representative (UKGI). However, the Committee has seen other examples in government where similar arrangements apply and where things have gone wrong … Read more
HM Treasury
View details
16 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank was set up to address market failures and fill gaps in financing for...
The Bank was set up to address market failures and fill gaps in financing for infrastructure investment.41 The Bank told us that it can do this by taking risk that the market is just not willing to take, for example … Read more
HM Treasury
View details
17 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank’s 10 deals to date have mostly been in relatively conventional investments.45 This total...
The Bank’s 10 deals to date have mostly been in relatively conventional investments.45 This total consists of seven loans and three equity investments made through funds rather than directly. The Treasury told us that the Bank was deliberately designed to … Read more
HM Treasury
View details
18 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank’s 10 deals to date have focused on clean energy (five) and digital (four)...
The Bank’s 10 deals to date have focused on clean energy (five) and digital (four) projects.49 These deals have generally been in areas of technology and risk where projects are relatively common, for example broadband and solar power farms.50 The … Read more
HM Treasury
View details
19 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank’s functions include providing an expert advisory service to help local authorities and other...
The Bank’s functions include providing an expert advisory service to help local authorities and other project sponsors to develop and finance infrastructure projects.53 The Bank told us that establishing this service is not straightforward, compared to its local authority lending … Read more
HM Treasury
View details
20 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank told us that in developing the pilots, it wanted to try to understand...
The Bank told us that in developing the pilots, it wanted to try to understand and define problems that it thinks will be most common across the local authority landscape, such as financing heat networks, zero-emission buses and social housing … Read more
HM Treasury
View details
21 Conclusion
Thirty-Fourth Report - The Creatio…
The Bank has not reached a decision on how it will fund its advisory function.
The Bank has not reached a decision on how it will fund its advisory function. Decisions on funding will be important given the Bank’s expectation that demand will be significant, and that it will not have the resource to cover … Read more
HM Treasury
View details
22 Conclusion
Thirty-Fourth Report - The Creatio…
The activities and policy objectives of the Bank overlap with departments across government.
The activities and policy objectives of the Bank overlap with departments across government. For example, the Department for Levelling Up, Housing and Communities (DLUHC) has policy responsibilities in relation to local government and to regional and local economic growth.59 The … Read more
HM Treasury
View details
23 Conclusion
Thirty-Fourth Report - The Creatio…
We asked whether the Bank had mechanisms in place to manage pressures from competing government...
We asked whether the Bank had mechanisms in place to manage pressures from competing government departments looking for the Bank to invest in their policy areas. The Bank told us that it is operationally independent to make its own decisions, … Read more
HM Treasury
View details
Correspondence 3 letters
23 Feb 2023 Correspondence from Andrew Griffith MP, Economic Secretary to the Treasury, HM Treasury, re update on the UK Infrastructure Bank’s (UKIB), dated 2 February 2023
Parliament page
22 Nov 2022 Correspondence from John Flint, Chief Executive Officer, Infrastructure Bank, re a profile of the banks interim staff, dated 17 November 2022
Parliament page
8 Nov 2022 Correspondence from John Flint Chief, Executive Officer, Infrastructure Bank, re update on progress, dated 1 November 2022
Parliament page