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The Treasury provided the Bank with £22 billion in capital to cover the first five...
Conclusion
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 expects to be profitable within five years, with its income exceeding the £70 million to £80 million a year cost of running the Bank.23 However, if the returns from current investments are needed to finance future deals, this would be “more challenging” to deliver within five years. The Bank told us that infrastructure financing is typically much longer dated that five years. When asked whether it would provide additional financing to the Bank after five years, the Treasury told us that if the Bank was additionally investing and meeting its targets,24 When challenged on whether the Bank would be sold in the future if it proved to be profitable, the Treasury told us that profitability wouldn’t be the only factor in any decision, and that the Bank’s contributions to major government goals such as working towards net-zero, and putting the Bank in statutory legislation, would make it “more difficult to sell”.25
Government Response
A response document is linked to this report, dated 12 April 2023. Response attribution to this conclusion has not been verified. Read the response document.
Source
Committee
Public Accounts Committee
Report
Thirty-Fourth Report - The Creation of the UK Infrastructure Bank
25 Jan 2023
HC 45
Addressee Bodies
HM Treasury
Timeline
Recommendation age
3.6 yrs
Report published
25 Jan 2023