Source · Select Committees · Treasury Committee
Recommendation 5
5
Deferred
Mitigate early privatisation risks of the National Wealth Fund by measuring its societal benefits.
Conclusion
The current Government should try and find ways to mitigate the risk of future governments privatising the NWF too early, by ensuring its societal benefits are measured and acknowledged. (Recommendation, Paragraph 32)
Government Response Summary
The government strongly agrees the NWF must remain operationally independent and details its governance structure and relationship with HM Treasury, but does not commit to specific actions for measuring and acknowledging societal benefits to mitigate future privatisation risk.
Government Response
Deferred
HM Government
Deferred
The government strongly agrees the NWF must remain operationally independent. This is crucial for safeguarding the NWF’s investment integrity and maintaining market confidence to ensure it can attract private capital at scale. The NWF has been established as a limited company and is overseen by an experienced fiduciary Board, led by an independent Chair and comprised of majority independent Non-Executive Directors. The NWF is strategically aligned and responsive to the government’s agenda. HM Treasury will issue strategic steers judiciously to ensure the NWF’s activity remains aligned with government priorities, with any updates made only in exceptional circumstances and published online. However, the NWF’s investment committees and executive team retain full operational independence in respect to its investment decisions within its delegated authority – apart from where these would be considered novel, contentious or repercussive, as set out in Managing Public Money guidance. The NWF also has independence in the day-to-day running of the business. As with all government arm’s length bodies, the relationship between HM Treasury and the NWF is governed by a Framework Document, which is currently being updated to reflect the NWF’s expanded role. The document will continue to clarify the NWFs operational autonomy and provide clear, transparent parameters for how HM Treasury exercises strategic guidance and oversight.