Capitalise the National Wealth Fund: note

Central fiscal result

+£1.5bn - Net fiscal impact in 2028-29

Low case: +£0.2bn. High case: +£4.0bn. Positive numbers are fiscal costs or borrowing pressure. Negative numbers are Exchequer savings or receipts.

Scenario and baseline

• Models capitalise the national wealth fund by 2028-29.
• Baseline is current policy or published departmental plans.
• Central case uses published party or official anchors where available.
• Wider manifesto interactions are excluded unless stated.

Affected population

• Affected units are people, firms, households or providers depending on policy.
• Direct exposure follows the manifesto or government target group.
• Indirect exposure includes suppliers, workers, consumers and taxpayers.
• Weakest counts are widened in the low and high cases.

Gross impact

• Published anchor or scenario central is +£1.5bn in 2028-29.
• Gross costs or receipts are adjusted for behaviour and delivery risk.
• Tax, benefit or procurement offsets are separated in the fiscal build-up.
• The range is deliberately wider where implementation detail is thin.

Fiscal build-up, central case

• Gross programme or delivery cost: +£1.7bn
• Tax and receipt offsets: -£0.1bn
• Administration and evaluation: +£0.1bn
• Behavioural and pass-through effects: -£0.2bn

Central net impact: +£1.5bn in 2028-29.

Behaviour and pass-through

• Low case assumes stronger delivery or receipts than central.
• Central case applies moderate behavioural leakage and pass-through.
• High case allows weaker delivery, larger take-up or higher costs.
• Output effects follow incidence, capacity and investment channels.
• Distributional gains do not automatically imply GDP gains.

Phasing

• 2026-27: +£0.2bn. Phased implementation and take-up.
• 2027-28: +£0.8bn. Phased implementation and take-up.
• 2028-29: +£1.5bn. Phased implementation and take-up.
• 2029-30: +£1.5bn. Phased implementation and take-up.

Main source groups

• Acemoglu, Aghion, Bursztyn and Hemous, "The Environment and Directed Technical Change" (American Economic Review, 2012): Climate policy can redirect innovation, but transition dynamics and path dependence matter; relevant to green investment and clean-power policy.
• Banerjee and Duflo, "Do Firms Want to Borrow More?" (Review of Economic Studies, 2014): Some firms are credit constrained, so public finance can support investment when well targeted; relevant to development banks and business finance.
• HM Treasury, "Autumn Budget 2024 policy costings" (2024): Official policy costings show tax and spending impacts, including behavioural assumptions where published; used for implemented Labour tax measures.
• Office for Budget Responsibility, "Economic effects of public investment" (2024): OBR analysis links public investment to potential output with long lags and uncertainty; relevant to capital programmes.
• Labour Party, "Change: Labour Party Manifesto 2024" (2024): The manifesto sets the policy pledge, funding claim or target being modelled; used as the policy definition and manifesto baseline.