(1 day, 14 hours ago)
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The Chancellor of the Exchequer (Rachel Reeves)
Three years on from the onset of the war in Ukraine, the Government remain steadfast in their support for Ukraine. The UK’s total military, budgetary and humanitarian support now stands at £12.8 billion, and the Government have committed to contributing £3 billion in guaranteed military support each year for as long as it takes.
The Government have on Saturday 1 March 2025 signed a loan agreement with Ukraine, setting out the terms by which the UK will provide our contribution of £2.26 billion under the G7 extraordinary revenue acceleration loans to Ukraine scheme. The loan will be limited recourse. The UK’s contribution is additional to all previous commitments to Ukraine. This agreement enables the Government to begin disbursing ERA funding to Ukraine shortly.
The G7 ERA initiative is set to collectively provide approximately $50 billion in loans to Ukraine. This crucial funding will be repaid using future flows of extraordinary profits generated from immobilised Russian sovereign assets.
On 16 January 2025, The Financial Assistance to Ukraine Act 2025 achieved Royal Assent. This Act provides HM Treasury with the authority to allocate funding towards the UK’s contribution to the ERA. The Government intend to disburse this contribution in three equal tranches over the next three fiscal years, starting in the current fiscal year 2024-25.
Given the urgent needs of Ukraine and the significant public interest in Ukraine’s defence of its territory and our shared aim of peace through strength, as well as the broader security of Europe and the UK, it is imperative that the first tranche of UK support under this scheme is distributed to Ukraine as soon as possible.
Parliamentary approval for additional capital of £752,667,000 for this new expenditure has been sought in a supplementary estimate for HM Treasury. Urgent expenditure estimated at £752,667,000 will be met by repayable cash advances from the Contingencies Fund.
The second and third tranches, payable in future financial years, will be funded in the usual way through the estimates process.
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