You’d think you might know who is supervising £½ TRILLION of our liabilities

Revealed : The body responsible for overseeing massive losses in the public sector

Montage © Facts4EU.Org 2024

A two-part Facts4EU.Org report, including an article by the Rt Hon Sir John Redwood MP

Today we reveal who is overseeing the massive losses being incurred in the public sector. This body is barely known yet it supervises contingent liabilities of more than £½ TRILLION of public money. It monitors organisations such as NatWest, the Post Office, and Network Rail, amongst a portfolio of 24 public ‘assets’.

We also publish a call from former Secretary of State the Rt Hon Sir John Redwood MP to abolish this organisation altogether, removing what he sees as a superfluous tier of bureaucracy, and giving back the supervision directly to the government departments responsible for each area of expenditure. We are grateful to Sir John for drawing our attention to this matter.

A Brexit Facts4EU.Org Two-Part Report

Part I : The body responsible for over £½ TRILLION of our public liabilities (This report)
Part II : From NatWest to the Post Office, we reveal 24 public investments UKGI is supervising

Had you ever heard of Manvinder (“Vindi”) Singh Banga?

No, we hadn’t either. Punjab-born and educated Mr Banga is the Chairman of UK Government Investments Ltd (UKGI), the governance and corporate finance arm of the UK Government. He earns in excess of £250,000 per year – much more than Prime Minister Rishi Sunak.

In effect, this is the vehicle used by the Government to manage its investment of our money in a variety of publicly-funded organisations such as the Post Office and Network Rail.

It costs £24m per annum just to fund the UKGI staff and management infrastructure, to say nothing of the costs to the taxpayer of the losses in the operations it manages where public money is involved.

The public’s liabilities now amount to more than 0.5 TRILLION pounds

Below is a table taken from the latest set of accounts from the UKGI. It clearly shows that the contingent liabilities for these investments of public money exceed 0.5 TRILLION pounds.

What is a ‘contingent liability’?

In the words of the UKGI itself:

“A contingent liability represents a government commitment to possible future expenditure if specific conditions are met or unforeseen events occur, such as loans guarantee (where government agrees to pay the debts of a third party if they default, such as the Export Development Guarantee (EDG) schedule run by UK Export Finance) and indemnities (protection similar to insurance where government agrees to cover costs such as clinical negligence claims against NHS GPs).”

In layman’s terms, a contingent liability means we are all ‘on the line’ for this money, if things go bad.

UKGI is now managing a portfolio of 24 ‘assets’ on behalf of the public

In the summary of their latest annual report the UKGI says :-

“Over the year we have taken on a new role for Sizewell C and a monitoring role for BBC Commercial. We successfully completed our role with the UK Green Investment Platform, with the corporate vehicle being liquidated following the successful disposal of its remaining entities. We have continued to strengthen UKGI as a centre of excellence for corporate governance across government by promoting our model and maintaining and sharing our knowledge and expertise.”

When it comes to being “a centre of excellence for corporate governance” we suggest the UKGI speaks to all the sub-postmasters whose lives have been ruined, or to the NatWest customers who have been debanked.

A disturbing guest article by the Rt Hon Sir John Redwood, MP for Wokingham

There now follows some shocking information, summarised perfectly, about how your money is being wasted. In our guest article below, former Secretary of State the Rt Hon Sir John Redwood MP summarises the losses in some of the organisations where public money has been invested – and lost.

UK Government Investments Ltd piles high the losses for the public

A disturbing guest article by the Rt Hon Sir John Redwood, MP for Wokingham

UK Government Investments Ltd is another of these 100% government-owned, arms-length bodies. It is meant to supervise and manage the government’s substantial holdings in nationalised businesses and its stakes in private sector companies.

Last year to March it ran up costs of £23.4m, paying its CEO over £260,000 and its staff a median salary of £91,000. The Treasury made £24m available to it to pay the bills. The auditor agreed it is a going concern because the Treasury will make cash available to pay the losses.

So what magic did we get for this expenditure? Why not rely on departmental supervision of these bodies which happens as well, with Ministers being more involved? Just look at what has been happening under UKGI’s stewardship.

The Post Office

PO has accumulated losses of £1.39 billion. It has presided over the calamity of the sub-postmaster accounting system. Recent stories suggest senior management is still not resolving the issues rapidly enough despite ministerial policy to do so.

Network Rail

Despite owning all the track and stations with a monopoly, the remaining net asset value of Network Rail is just £15bn. £55bn has been expensively borrowed against its network assets. It lost £1.14bn last year.

The British Infrastructure Bank

A relatively new venture, this bank lost £21.4m last year with costs of £35.8m. It is planning to commit £22bn to investments, with £10bn of that being guarantees and the rest debt and equity underwritten by taxpayers. The Bank does not expect to be profitable anytime soon. I expect it will be able to deliver that forecast.

Sheffield Forgemasters

This is a government-owned defence supplier. It lost £5m pre-tax last year but does have positive assets and provides some important products.

NatWest

UK Government Investments says it engaged with NatWest as shareholder over its culture and values. It was very quiet over the leaks from NatWest and the resignation of the Chief Executive. Clearly its engagement did not prevent serious problems.

OneWeb

This investment is now sitting on big losses. It has been rolled into EUtelsat as a UK minority holding, only for those shares to fall more. It is difficult to see why the UK taxpayer should be losing money in a 10% holding of a European business like this that it is not currently making us money.

Sizewell C

Much delayed and significantly over its original budget.

The government should get rid of this body and go back to more detailed supervision by ministers advised by their departmental officials who currently help supervise these businesses. This track record is very poor and is not worth £24m a year.

- The Rt Hon Sir John Redwood, MP for Wokingham, Fri 23 Feb 2024

To give readers some idea of the culture at UKGI

Below is part of the summary of the last annual report from UKGI. It gives some idea of their priorities, while the British people’s money is being wasted on a grand scale.

“We successfully delivered our People Action Plan. Excellent progress was made against the key themes of connectivity, reward/recognition, work-life balance, hybrid working, leadership and culture. We have exceeded our formal gender diversity target with 46% of senior management now female and met our target to have 10% of the senior management cadre identifying from an ethnically diverse background. UKGI’s mean gender pay gap composition over the past five years has gradually shifted from 27.2% at 31 March 2018 to 6.6% as at 31 March 2023 and this underlines our commitment to furthering diversity and inclusion.”
- Latest UKGI annual report, 19 July 2023

Coming up in Part II

In Part II of this report we present readers with the full panoply of their investments - all of which are at risk. Do not miss this!

Observations

In our experience, when a conviction politician speaks out, the public are more inclined to listen. They recognise when an MP is not doing something for personal advantage or advancement. Sir John Redwood is in this category.

In his article he has drawn our attention to the way the UKGI is managing billions of pounds of losses to the British taxpayer and we are paying this quango £24m per annum for the privilege of doing so.

As Sir John points out, the UKGI’s stewardship of public funds has done nothing to prevent the scandal of the way sub-postmasters were treated, nor has it made any impact at NatWest, with all its woke policies and the debanking scandal there.

Despite this, here is what UKGI had to say yesterday

“Over the year, UKGI’s Corporate Governance and Portfolio Management Programme has continued to embed stewardship best practice across our evolving Portfolio of Assets. Our position as a centre of excellence means we seek continuous improvement in how we deliver this shareholder role, applying learnings across our portfolio.”
- UKGI Stewardship Code Report, 22 February 2024, (Vindi Banga, Chairman)

We would strongly question the “centre of excellence” status which the UKGI has conferred upon itself.

In Part II : What organisations are we funding? You don't want to miss this!

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[ Sources: UKGI | The Rt Hon Sir John Redwood MP ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Fri 23 Feb 2024

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Reader Comments 5

1. Ashley Great Britain , Friday, February 23, 2024, 07:15:

Yet another government department draining the chest.
They know they stuff up all the time so they have ensured there is a fallback to the taxpayer paying to sort it out.
However as with most things now days it fails to do its job. They don't protect and sort out our assets they just drain money in pay and waist money with incompetence.
We just sit back in amazement quite powerless to do anything, With no say.
Only one new party can begin to change all this.

2. Sparky , Friday, February 23, 2024, 09:27:

John Redwood says that the Govt should get rid of this body and there should be more detailed supervision by ministers. Given how ministers perform and how long they last sureley not. Clearly UKGI has some poor performing areas which have been cherry picked, but the list of nationalised industries that UKGI works with is significant.
.
How about holding a referendum on UKGIXIT??

3. jon iivesey , Friday, February 23, 2024, 18:50:

I think you have some very different assets and very different issues mixed up here. For example, The British Infrastructure Bank and Sheffield Forgemasters are both engaged in basic development of assets for the future, so it does not really matter if they make losses since you can view the losses as just extra cost of development. On the other hand The Post Office is providing a day to day service, so it should be charging the cost of its service and not accumulating losses.
Similarly, there is not indication here of the extent to which these assets are merely owned, and which are managed. I this body just has an ownership stake in an enterprise, then it makes no sense to blame it for low-level mis-management, which should instead be blamed on the internal management of the enterprise in question. On the other hand, it's pretty clear that when the justice system started doing The Post Office's dirty work for it, Government had a responsibility.
This kind of confusion is what results when you try to "kitchen sink" issues and end up mixing up different types of problems.

4. Have You Wondered , Friday, February 23, 2024, 18:54:

.
Funny you should mention economics - hot off todays European press:
.
"....The European Central Bank and some of its largest national affiliates are generating large losses "
"The ECB printed trillions of euros worth of cash to stimulate growth and most of that excess liquidity, 3.5 trillion euros, "
"German, Dutch central banks post big losses, warn of more "
“We … expect them to be considerable again for the current year.”
Search: 2024 02 german dutch central banks post big losses warn of more
.
And a few days ago:
.
Germany and Belgium selling off the silverware?
Search: belgium 917079 selling off public assets could pump billions into belgian state coffers
"The German government has successfully raised €2.2 billion through the sale of shares in Deutsche Post...."
"With a budget deficit of €26.7 billion, attention in Belgium is turning to whether selling off public shareholdings could provide a much-needed fiscal boost."
.
Forget all the statistics and prophecies that are manipulated - above is the reality - the economic turmoil in the sunlit uplands of the EU ....
.
and all because of Brexit !!
.

5. jon iivesey , Friday, February 23, 2024, 19:20:

There is an issue that should be worrying everyone. While some countries are supporting Ukraine with effective weapons, the EU response seems to boil down to giving Ukraine the minimum needed to avoid defeat. Most of what EU countries have donated were either Cold War era ex-Soviet weapons, or short range weapons that are useful on defence, less so in attack.
This probably seems like a low-risk policy, which it is in the short term, by avoiding a confrontation with Russia. But in the low term, by allowing the war to drag on, the EU is encouraging Putin to gradually militarise the Russian economy, develop new weapons and increase capacity for manufacturing missiles and other ammunition.
If that process goes on for much longer, the EU will have assisted in the creation of a Russia on its borders that is much more aggressive and much better armed than it was when the Ukrainian War started.
The only safe policy here was to ensure that Russia lost the war quickly in order to learn the lesson that aggression does not work. Instead, the EU is teaching Putin and a few others that aggression does work if it is persistent enough and if it is accompanied by an implied threat to disturb the peace of Europe. The EU is saying that ll it will ever do is provide support to those who are attacked, but never enough to risk a threat to itself. That is not the kind of partner any country under threat wants, because it encourages aggression and then freezes every conflict rather than winning them, and that makes the EU rather complicit, because it encourages aggression instead of deterring it.

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