The NWF was launched by Britain’s Labour government last year to help spur the economy and unlock private support for projects

International News via Reuters:

Britain’s National Wealth Fund (NWF) must be allowed to take risks and back projects that ultimately fail, lawmakers said on Tuesday, as the state-owned investor tries to step up backing for local infrastructure and companies to stimulate growth.

The NWF was launched by Britain’s Labour government last year to help spur the economy and unlock private support for projects. But a report by lawmakers on the Treasury Select Committee said the limited scale of available funding could reduce its impact.

A spokesperson for Britain’s finance ministry said the government would carefully consider the report. “The National Wealth Fund is a powerful engine for growth,” the spokesperson said, noting it had supported projects including debt finance to the planned Sizewell C nuclear plant in eastern England. 

Unlike more established wealth funds, such as Norway’s, which are funded by revenues from natural resources like oil and gas, Britain’s NWF will instead be financed by government debt. 

Its initial budget upon launch was for a total capitalisation of 28 billion pounds ($37.6 billion), far below Norway’s $2 trillion wealth fund.

A balance needed to be struck between risk-taking and long-term sustainability for the NWF to work, the lawmakers’ report said, adding that its government financing meant it would likely face increased scrutiny. 

Ministers should not be involved in the day-to-day running to avoid investors being put off by fears of political interference, the report added.

“The National Wealth Fund has the potential to make a positive contribution to certain sectors and the economy more widely. But for it to do so, the government must accept and encourage the fund to take risks, even though that might lead to individual projects failing,” said Meg Hillier, chair of the Treasury Select Committee.

“The NWF must be bold and take on riskier investments which open the door for the private sector to get involved,” she said.

($1 = 0.7451 pounds)

Reporting by Iain Withers, Editing by William Maclean and Tomasz Janowski

Culley, 19, from Billingham in northeast England, went missing in Thailand before flying to the South Caucasus country’s capital Tbilisi in May

International News via Reuters:

The family of Bella Culley, a pregnant British teenager arrested earlier this year on drug smuggling charges in Georgia, said on Tuesday they had paid $187,000 in compensation to a court to secure her release.

Culley, 19, from Billingham in northeast England, went missing in Thailand before flying to the South Caucasus country’s capital Tbilisi in May, where she was arrested at the airport on arrival. Georgian prosecutors say she was carrying 12 kg (26 lb) of marijuana and 2 kg of hashish in her luggage.

Drug smuggling carries a prison sentence of up to 20 years in Georgia. Culley has been held at a women’s prison in Rustavi, a city just outside Tbilisi.

Culley’s mother, Lyanne Kennedy, told reporters outside the Tbilisi courthouse on Tuesday that the family had paid 500,000 lari ($186,846) and were waiting for the funds to be credited to the relevant government account.

Asked about the health of her daughter Kennedy said: “She’s looking big, pregnant, but she looks strong.”

Culley’s lawyer, Malkhaz Salakaia, said the court would hold another hearing on the case next Monday.

Culley initially pleaded not guilty at a hearing in July to possession and trafficking illegal drugs, and said she had been tortured into transporting them.

She said she was a “clean person” and did not do drugs.

($1 = 2.6760 lari)

Reporting by Reuters; Writing by Lucy Papachristou; Editing by

The application to the UK’s Generic Design Assessment (GDA) process marks the first regulatory step towards deploying its Natrium technology in a global market, TerraPower said

International News via Reuters:

TerraPower, a nuclear innovation company founded by Bill Gates, has submitted a design for a new type of reactor and energy storage system for regulatory approval in Britain, in its first foray into international markets, the company said on Tuesday.

The application to the UK’s Generic Design Assessment (GDA) process marks the first regulatory step towards deploying its Natrium technology in a global market, TerraPower said.

“We look forward to working with the UK government as we work through the review process,” said Chris Levesque, TerraPower president and CEO.

The company is looking to identify sites for its Natrium reactor in the UK in cooperation with U.S. engineering firm KBR, it added.

TERRAPOWER DESIGN MAY HELP UK DECARBONISATION EFFORTS

The UK is seeking to expand nuclear power, both large-scale as well as small modular reactors (SMR), as part of a drive to decarbonise its energy system while meeting growing demand, highlighting the potential significance of TerraPower’s design.

Potential hurdles to this effort include worries over financing, political opposition, and technical challenges.

TerraPower, co-founded by billionaire Gates, has cleared regulatory requirements in the United States, where the first Natrium plant is being constructed.

Its design features a 345 megawatt (MW) sodium-cooled fast reactor, with a molten salt-based energy storage system that is able to boost output to 500 MW for more than five and a half hours when needed, the company said.

This allows for seamless integration with renewable resources, it added.

Reporting by Nora Buli in Oslo; Editing by Bernadette Baum

Finance minister Rachel Reeves has said the Office for Budget Responsibility is likely to cut its productivity forecast after acknowledging it had been too optimistic in the past

International News via Reuters:

Britain’s budget watchdog is expected to cut a key productivity forecast by a larger-than-expected 0.3 percentage points, people familiar with the situation said, potentially leading to a 20 billion-pound ($26.8 billion) hit to the public finances.

Finance minister Rachel Reeves has said the Office for Budget Responsibility is likely to cut its productivity forecast after acknowledging it had been too optimistic in the past.

But a 0.3% downgrade – first reported by the Financial Times and larger than the 0.1 or 0.2 percentage-point cut that had been expected – will place more pressure on Reeves as she prepares her budget for November 26.

The Institute for Fiscal Studies, a think tank, estimates that each 0.1 percentage point downgrade to annual productivity growth would raise public borrowing by 7 billion pounds by the 2029/30 financial year.

MASSIVE SPENDING SHORTFALL NEEDS ADDRESSING

Analysts had already expected Reeves to need to fill a spending shortfall of up to 30 billion pounds based on the lower productivity downgrade as well as a reversal of planned welfare savings by Prime Minister Keir Starmer and other factors.

Speculation has mounted as to which tax rises and spending cuts will be needed to keep the government on track for its fiscal targets and avoid upsetting bond investors.

The finance ministry said it would not comment on the media reports.

Reeves, speaking at a conference in Saudi Arabia on Monday, reiterated that the expected downgrade was due to weak productivity numbers since the 2008 financial crisis and Britain’s departure from the European Union in 2020.

The OBR’s outlook for trend productivity – measured as output per hour worked – is central to its economic projections which, in turn, underpin its fiscal estimates. Those estimates have yet to be finalised.

‘SEVERAL MOVING PARTS’ TO ESTIMATING IMPACT TO BUDGET

JP Morgan economist Allan Monks said there were several moving parts involved in estimating the size of the hit to the budget from the reported productivity downgrade which, he said, could reach almost 27 billion pounds.

But other factors such as a recent fall in borrowing costs in financial markets or more people coming into the jobs market could help limit the damage.

“For now, we are still assuming a 20-30 billion-pound range, but with the risk that this could be exceeded to some degree,” Monks said.

As well as offsetting the productivity and welfare hit, Reeves has said she would like to raise her headroom for meeting her budget targets – including a goal to balance day-to-day borrowing with tax revenues by 2030 – from the relatively small 9.9 billion-pound buffer she previously given herself.

($1 = 0.7451 pounds)

Reporting by Mrinmay Dey in Bengaluru and Alistair Smout and Kate Holton in London; Writing by Muvija M; Editing by Sharon Singleton, Chizu Nomiyama and Bernadette Baum