Contingencies Fund Advance

Nadhim Zahawi Excerpts

Monday 20th July 2020 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Nadhim Zahawi)]

I hereby give notice of the Department for Business, Energy and Industrial Strategy’s intention to seek an advance from the Contingencies Fund of £5,070,000,000 to provide funding for the Nuclear Liabilities Fund (NLF).

The funding will be used to increase the NLF’s public sector assets, by making £5.07 billion available to the NLF in the form of a deposit in the national loans fund. This offers an alternative investment opportunity to the NLF, which otherwise would re-allocate moneys within the next month into investments in its privately held asset portfolio. Such re-allocation would increase public sector net debt, and so this alternative funding arrangement avoids this immediate negative fiscal impact. The payment to the NLF is fiscally neutral.

The trustee directors of the NLF have a fiduciary duty to ensure the NLF remains on track to be sufficient to meet certain future decommissioning liabilities. Parliamentary approval for additional capital of £5,070,000,000 will be sought in a supplementary estimate for the Department for Business, Energy and Industrial Strategy. Pending that approval, urgent expenditure estimated at £5,070,000,000 will be met by repayable cash advances from the Contingencies Fund.

The cash advance will be repaid upon receiving Royal Assent on the Supply and Appropriation Bill.

[HCWS388]