The London School of Economics’ Grantham Research Institute on Climate Change and the Environment (LSE GRI) has recommended the creation two funds to help the UK address regional disparities and meet its net zero climate commitments. The GRI had proposed the creation of the UK Growth Fund, a venture capital fund-of-funds that aims to combine pension and other large pools of institutional capital, acting as an umbrella vehicle for a portfolio of sector-specific funds. The UK Growth Fund would be designed to attract private equity investors and have the objective of addressing market failures in priority areas for the UK’s future prosperity and wellbeing. It would target the raise of £4.6 billion (US$5.6 billion) at launch, rising to at least £46 billion over five to 10 years. The GRI also recommended the creation of a new UK Community Growth Fund. This fund would expand on existing programmes. including the £60 million Community Investment Enterprise Facility, and would target £100 million of commercial bank and social investment at launch. It proposes that the Growth Funds be managed within the existing national finance institutions established by the UK government, and overseen by a new government unit to provide a centre of expertise on blended finance. The recommendation of both funds are part of a report by the LSE GRI on practical solutions for the UK government to mobilise private investment for economic, environmental and social policy priorities.
Every £1 of taxpayer money can mobilise many more multiples of private capital to meet the UK’s most pressing public policy needs – such as #NetZero & social housing.
This new report by @sarahgor shows how 👇🏾https://t.co/xhFcb8b8Wo pic.twitter.com/nFOWwzsk0Z
— Grantham LSE (@GRI_LSE) October 23, 2023