Covid-19: Public Wealth Investment Fund

Lord Liddle Excerpts

Tuesday 9th June 2020 Lords Chamber

[Lord Agnew of Oulton [V]]

I certainly commit to chasing up a reply to the letter that the noble Lord mentioned. Businesses run by the BAME community are of course vital to our economy.

[Lord Liddle (Lab) [V]]

My Lords, I want to press the Minister on the key point of principle in my noble friend Lord Haskel’s excellent Question. Do the Government accept the need to set up a mechanism whereby the state can take equity stakes in overindebted companies? Do they accept that this is vital to what the Minister describes as safeguarding our productive capacity and to a strong and sustainable recovery? Does the Minister accept that the debate is not about whether this should happen but about how it should happen? The sooner we start talking about this, the better.

[Lord Agnew of Oulton [V]]

There are two parts to that question. First, on 20 May, we announced the future fund of an initial £250 million for co-investment with businesses. There has been enormous interest in that; some 460 applications have been made up to the end of May. On the noble Lord’s reference to overindebted companies, we have to deal with the issue that the shareholders and management of those companies have contributed to that problem. They need to resolve the substantial concessions that they will have to make to their own equity, and to the lenders who have lent—and possibly overlent—to these businesses. There are two separate strands to this, but both will be active in future.