Singapore’s sovereign wealth fund warns UK government about utility regulations

Singapore’s sovereign wealth fund has told the government it will not invest in regulated UK water, electricity and gas utilities because of unpredictable infrastructure rules, in a blow to Labour’s economic strategy.

GIC, the world’s seventh largest sovereign wealth fund with more than $800 billion (£600 billion) in assets, stated its position during a private meeting with Environment Secretary Steve Reed earlier this month , appropriate The Sunday Times.

One person at the meeting, including representatives from the Abu Dhabi Investment Authority and Australian infrastructure giant Macquarie, was said to have told Reed that UK utilities “were completely off our radar at the moment”. because regulators have become “too unpredictable”.

AM city has contacted GIC for comment.

The news comes as Thames Water, Britain’s biggest water company, faces the prospect of temporary nationalization as it struggles under a massive debt pile.

Potential new investors are likely to keep an eye on the Thames until regulator Ofwat publishes its final decision on how much the firm can charge customers over the next five years, due in December.

Apparently Reed was told at the meeting that Ofwat’s price capsrather than allowing water companies to raise bills as much as they want, they would impact on wider investments in the sector.

Reed claimed this very month that strengthening water regulation would “attract global investment” to rebuild the UK’s sewerage and pipe infrastructure.

His comments came shortly after the Water (Special Measures) Bill was unveiled in Parliament, which increases the powers of watchdogs to issue fines, carry out surveillance and recover the costs of investigations.

The comments come at a difficult time for the prime minister, Keir Starmer, and his chancellor, Rachel Reeves.

The new Labor government has pinned high hopes on attracting billions of pounds of foreign investment to Britain to boost growth.

However, the government’s growth plans got off to a shaky start.

Sky News reported that fewer than 150 of the 300 company ministers who have pledged to attract to its flagship investment summit next month have confirmed their attendance.

GIC is understood to remain bullish on further UK investment opportunities. About five percent of the fund’s investments are in the UK.

A GIC spokesman told The Sunday Times: “GIC established its European headquarters in the UK in 1990. For more than three decades, GIC has invested in the UK in the public and private markets.

“We remain committed to the UK market and will continue to look for investment opportunities that will be good additions to the overall global portfolio.”

A spokesman for the Department for Environment, Food and Rural Affairs commented: “There have been constructive discussions about how there are significant investment opportunities in a reformed water sector where our creaky water infrastructure is improved and we clean up our rivers, lakes and the seas.”

After AM city

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