Aviva and Lloyds are among a group of City firms to throw their weight behind the government’s National Wealth Fund today in a boost to Rachel Reeves’s plans to push private sector investment into the economy.
The Investment Delivery Forum, founded by seven of the UK’s biggest insurance and long-term saving firms, has pledged to pump billions of pounds into Reeves’ new wealth fund and finance the development of areas like electric vehicles and nuclear energy infrastructure.
“Members of the Forum stand ready to act to accelerate the nation’s investment into green and good infrastructure,” said Baroness Nicky Morgan, chair of the Investment Delivery Forum. “This will deliver growth, jobs and help us meet our net zero targets.”
Founded in 2023, the investment delivery forum was set up to channel a wave of institutional and pension cash into infrastructure projects. FTSE 100 investors M&G and Phoenix, as well as Royal London, Rothesay and Just, were also founding members of the group.
The group did not disclose an exact target figure of how much cash they would commit to the fund.
Central to the group’s plans is financing a national EV charging network, which is detailed in the report. They say this could require £20bn of private investment over the next 15 years.
The commitment will boost Reeves after she announced the launch of a National Wealth Fund made up of a mix of public and private sector cash in her first week in office.
Under the plans, the government has committed an initial £7.3bn of taxpayer’s money and overhauled the mandate of the UK Infrastructure Bank and British Business Bank to manage the investment of the fund.
Much of the group’s investment plans will hinge on the rollout of the new Solvency UK regime in January. This regime was drawn up under the previous government to unlock up to £100bn in investment from big insurance firms.
Investment from City insurers was previously hamstrung by EU Solvency II rules which required them to maintain a massive capital buffer on their balance sheet.
Commenting on the pledge today, Hannah Gurga, director general of the Association of British Insurer – which has coordinated the group, said insurers were poised to pump cash into the economy when regulatory reform came in.
“The Investment Delivery Forum has laid firm foundations for the industry to act on the opportunity that reforming the regulatory framework brings, with £100bn set to be channelled into green and good infrastructure over the next 10 years,” she added.