Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether she has made an assessment of the potential implications for her polices of recent trends in levels of capital provision by US venture capital firms in (a) UK and (b) other markets.

Venture capital (VC) investment from around the world is important to the UK economy, and US investors continue to play a significant role. In Q1 2025, UK innovation businesses raised over £3bn – this is an 8% increase on the same period last year and the highest Q1 total since 2022. The UK ranks third globally for VC investment and has raised more than France, Germany, and Spain combined so far this year.

The Government is taking action to continue attracting international VC investment, including from the US, through the investor relationship work of the Office for Investment and by partnering with industry on international capital roadshows. We are also reviewing how to accelerate the growth of the UK’s domestic VC ecosystem through the public finance institution landscape review.

In addition, the Government recognises the value in growing the UK’s domestic VC investment market and it is taking steps to support this, including through the British Growth Partnership (BGP). This is a commercially driven investment vehicle designed to attract UK pension fund and other institutional capital into venture capital funds and innovative businesses. Last September, the Chancellor also announced an extension of the UK’s generous venture capital tax reliefs, the Enterprise Investment Scheme and the Venture Capital Trust scheme which - alongside the Seed Enterprise Investment Scheme - offer generous tax reliefs in return for investing in UK business.