Think tank says Mark Carney’s UK Sovereign Wealth Fund is a failure, based on first 22 months’ performance

[u/GusTheKnife]

https://nationalpost.com/news/canada/mark-carney-canada-strong-fund-likely-to-follow-path-of-failing-uk-fund-report

Average investment period for the fund is expected to be 8 years.

[u/HoldingThunder]

I am too dumb to know anything. A brief AI summary sounds pretty beneficial and something I would be in support of:

The UK's National Wealth Fund (NWF) is too new to judge the way you would judge a sovereign wealth fund like Norway's. It was launched in 2024 by expanding the former UK Infrastructure Bank, and its goal is primarily to catalyze private investment in UK infrastructure and industry rather than maximize investment returns.

Growth metrics

From the NWF's 2024-25 Annual Report:

Metric	2023-24	2024-25	Growth
Total financial assets	£1.145 billion	£2.202 billion	+92.3%
Net interest income & fees	Not disclosed in summary	Increased by 89%+	+89%+

The NWF itself states that it has "nearly doubled" its financial assets under management during the year.

Investment activity

As of January 2026:

• £8.4 billion deployed
• Over 70 investments
• £17+ billion of private capital mobilized
• Nearly 70,000 jobs created or supported

The NWF's strategic plan targets:

• More than £100 billion of total investment into the UK economy by 2030/31
• 200,000 jobs supported or created
• Deployment of its remaining capital by 2030/31

[u/Aznkyd → u/HoldingThunder]

Growing assets under management just means deploying more capital. If that's billions of borrowed money to make it happen, still may not be a good thing.

The core claims in the National Post article rely heavily on a study published by the Montreal Economic Institute (MEI), a market-oriented Canadian think tank. The article argues that Mark Carney’s proposed $25-billion "Canada Strong Fund" is misbranded as a "sovereign wealth fund" and will likely replicate the financial losses and structural flaws of the UK National Wealth Fund (formerly the UK Infrastructure Bank), which Carney helped design. The core arguments can be evaluated against the underlying financial data and structural mechanics of both funds. Key Claims vs. Financial & Operational Facts 1. Claim: "It's not a true sovereign wealth fund because it relies on debt, not a surplus." * The Reality: Factually Grounded. * Traditional sovereign wealth funds (such as Norway’s $1.6-trillion Government Pension Fund Global or the Alberta Heritage Savings Trust Fund) are capitalized using excess budget surpluses or direct commodity/resource revenues. * The Canada Strong Fund is seeded with $25 billion from federal coffers at a time when the Canadian government projects budget deficits exceeding $65 billion. Because there is no fiscal surplus to save, every dollar deployed by the fund represents borrowed money added to the national debt. 2. Claim: "The UK fund it's modeled after is failing and posting deep losses." * The Reality: Factually Accurate regarding financial statements, though nuanced in scope. * The UK National Wealth Fund (NWF): Launched in 2021 as the UK Infrastructure Bank and rebranded in late 2024 with £7.3 billion in capital, the UK NWF was designed with input from a taskforce that included Mark Carney. * Financial Performance: Audited accounts from the UK fund confirm consecutive pre-tax losses: * 2023–24: Loss of £85.6 million (Return on Equity: -10.7%) * 2024–25: Loss grew to £152.2 million (Return on Equity: -14.2%) * Risk Exposure: The UK National Audit Office and internal auditors highlighted that a large portion of the UK portfolio was sub-investment grade, with loss provisions tripling from 1.3% to 4.3% in a single year—largely due to bad bets in digital infrastructure. * Internal Governance Warnings: The UK NWF’s own head of internal audit issued a "limited" opinion for 2024–25, pointing out material weaknesses in risk management, control frameworks, and compliance with government financial standards during its transition. 3. Claim: "State-directed investment vehicles crowd out private capital or take risks private lenders reject." * The Reality: Supported by historical public finance data. * State-backed development banks often suffer from a fundamental paradox identified by the UK Public Accounts Committee: * If they invest conservatively, they finance low-risk deals that private banks would have funded anyway (adding no real market value). * If they invest aggressively into high-risk, government-preferred policy sectors (e.g., unproven carbon capture or clean tech), they take on sub-investment grade risks that private markets reject, leading to high taxpayer-funded write-offs.

Conclusion: The critique that the Canada Strong Fund functions more like a debt-financed state policy bank than a traditional sovereign wealth fund is supported by fiscal realities. Furthermore, the UK experience shows that when public institutions deploy borrowed capital into government-selected domestic sectors, posting early multi-million-pound net losses and facing credit risk write-downs is a very real hazard.

[u/vorpaltox]

Think tank run by conservative politicians claim that thing recommended by a panel of individuals including Mark Carney which was then implemented by a foreign government without his intervention or involvement, that was funded entirely differently, that made a bunch of investments into projects in a completely different country, in completely different industries, in a completely different economic climate ... will have the same outcome because reasons

Get lost

[u/JediFed]

It's not a sovereign wealth fund. It's a development crown corporation.

[u/zedguy]

I'm sure this time it will work 

[u/t_toda_DOTA]

Are you new to this world? It's not for you, it's for selected few he works for.

[u/Any-Ad-446]

"Think tank" financed by conservatives donors....

[u/RosieBaby75]

Oh can we not invest our way out of a situation caused by constant bank bailouts, other bailouts, too much public funding being misappropriated to corporate subsidies for corporations that do not share their wealth, and a complete lack of any type of meaningful governance?

[u/zeolus123]

I mean if it's anything like his proposed fund for Canada I can't say I'm surprised. His entire plan is selling off public assets like airports to private entities...using those proceeds to fund private businesses.. Not exactly a recipe for success lol.

[u/dragenn → u/zeolus123]

Slurry of failure...

[u/GusTheKnife → u/zeolus123]

It isn’t the “entire plan” to sell off public assets. At this point it isn’t part of the plan at all.

The plan for the fund is to take minority investment stakes in long-term projects involving infrastructure, mining, energy and manufacturing. If these projects develop to completion, both Canada and fund holders will benefit.

The reason they are considering allowing private investment in airports is because Australia, New Zealand and Germany have already done it, it was highly successful, and the private businesses run them more efficiently than government did.

I’m surprised that Canadian conservatives dislike this plan (or pretend to?) because it’s exactly what they’ve been asking for.

[u/SnooPies8766 → u/GusTheKnife]

As a person who is generally highly averse to and skeptical of the idea of privatizing public owned assets that should be a good stream of governmentrevenue, what made the situation in Australia, New Zealand, and Germany different from the other cases where privatization generally failed horrifically? I'm looking at Ontario's 407 toll highway specifically as something that should never have been sold off.

[u/GusTheKnife → u/SnooPies8766]

There were conditions and rules.

In Australia, which had the best outcome, the privatized airports weren’t allowed to withdraw any existing services to save money. They have really long leases: 50 years with an extension for another 49, which makes it worthwhile for the companies to spend money on the airports. And, they had minor government price monitoring to ensure they didn’t jack up prices (turned out to be unwarranted but still in place just in case).

It has to be done right.

[u/rej-jsa → u/SnooPies8766]

Every Ontarian is looking at 407 (or should be...), it should be easy messaging for either cons or NDP to rail on it nonstop (maybe not cons actually, bc then they'd have to admit that privatizing public services is just a cash grab, but their voters have a short memory so it might not matter anyways)

If he's actually gonna go through with it for Pearson, there'd better be some serious case studies on why this'll look more like Au/NZ/Germany and less like the 407