Chancellor Hunt earmarks £320m for funds backing UK innovation
Jeremy Hunt (pictured), Chancellor of the Exchequer Credit: UK Parliament
Of the announced investment, £250m will go to two unnamed bidders under the Long-term Investment for Technology and Science (LIFTS) initiative, which works to establish new funds to invest in science and tech companies.
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Under the scheme, two new investment vehicles will be created that can be invested in by pension funds. The government expects this will ultimately lead to over £1bn of total private capital, including substantial amounts from defined contribution pension schemes, going to support innovative UK companies.
Separately, a new Growth fund will be established within the British Business Bank (BBB). This follows July's Mansion House speech when the chancellor asked the BBB to create a fund that could receive third-party capital, such as pension fund investment, to invest in promising high growth companies.
The Growth fund will use the BBB's market access and position as the largest domestic investor in UK venture capital, and draw on a permanent capital base of over £7bn.
The government said it has support for the creation of the Growth fund from eight pension providers and fund managers, managing total assets of over £350bn, on the basis that such a vehicle «could be a valuable addition to the market».
The BBB will now work closely with industry on the design of the investment vehicle before announcing further details.
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Chancellor Jeremy Hunt said: «Innovation is the key to our future success as a nation and it's vital that we do all we can to help companies start, scale and grow in the UK.
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