NatWest Group: Government Shareholding
(3 days, 18 hours ago)
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The Economic Secretary to the Treasury (Emma Reynolds)
The Government are no longer a shareholder in NatWest Group—NatWest, formerly Royal Bank of Scotland—due to the disposal of the remainder of the Government’s shares through the trading plan on 30 May 2025. Metric Impact Net sale proceeds £13.2 billion (total proceeds from sales of shares through the trading plan) Retention value range Within the valuation range Public sector net borrowing Nil There may be future indirect impacts as a result of sales made via the trading plan. Sales proceeds reduced public sector debt. All else being equal, sales reduced future debt interest costs for Government. PSNB will also be impacted by the loss of future dividends. Public sector net debt Reduced by £13.2 billion Public sector net financial liabilities Nil Public sector net liabilities Nil Date Sale method Size of transaction Proceeds 04/08/2015 Accelerated bookbuild 630 million shares £2.1 billion 04/06/2018 Accelerated bookbuild 925 million shares £2.5 billion 19/03/2021 Directed buyback 591 million shares £1.1 billion 11/05/2021 Accelerated bookbuild 580 million shares £1.1 billion 28/03/2022 Directed buyback 550 million shares £1.2 billion 22/05/2023 Directed buyback 469 million shares £1.3 billion 31/05/2024 Directed buyback 392 million shares £1.2 billion 11/11/2024 Directed buyback 263 million shares £1.2 billion 12/08/2021 to 30/05/2025 Trading plan 4,310 million shares £13.2 billion Total £24.8 billion *Numbers may not sum due to rounding Type Amount (£ billion) Comments Sale proceeds 24.77 Total combined proceeds from sales of the shareholding between 2015 and 2025. Dividends 4.91 Total combined dividends received since the bank recommenced dividend payments in 2018. Dividend Access Share 1.51 Combined value of payments made to retire the DAS, which provided enhanced dividend rights to HMT following the provision of capital support to RBS. The DAS was retired in 2016. Asset Protection Scheme fees 2.50 Fees paid by RBS in exchange for its participation in the APS, which protected against exceptional credit losses on certain portfolios of assets. RBS exited the APS in 2012. Contingent Capital Facility fees 1.28 Fees paid in return for the provision of an £8 billion CCF to RBS by HMT in 2009. The CCF was terminated in 2013. Total £34.98 *Numbers may not sum due to rounding
This concludes nearly 17 years of the Government being a shareholder in the bank and brings to an end the public ownership of banks resulting from the 2007-09 global financial crisis.
In total, the Government raised £24.8 billion in proceeds from sales of their shares in NatWest. Also accounting for dividends and other fees, the Government received a total of £35 billion in relation to their shareholding in NatWest. This is approximately £10.5 billion lower than the amount of capital originally provided to stabilise the bank. However, the Government believe that the cost of not acting to protect the economic and financial stability of the UK economy would have far exceeded £10.5 billion.
Policy rationale
The Government have been committed to returning NatWest to full private ownership, given that the original policy objective for the intervention in NatWest—to preserve financial and economic stability at a time of crisis—has long been achieved. The Government conducted sales of NatWest shares only when it represented value for money for the taxpayer to do so.
Format and timing of the final sale
The Government concluded that selling shares through the trading plan represented value for money. The trading plan, which was launched in August 2021 and was most recently extended in April 2023, has now ended. In total, the trading plan generated over £13.2 billion in proceeds from sales of NatWest shares.
Table 1: The net impacts of sales made via the trading plan on a selection of fiscal metrics are summarised as follows:
Detail on the Government’s shareholding in NatWest
Over the course of 2008 and 2009, the Government provided circa £45.5 billion to recapitalise RBS. This was done, as part of a series of interventions made by the Government in the financial sector, to protect ordinary savers and businesses from the collapse of a bank that was vital to the functioning of the UK economy and financial system. Allowing RBS to fail would have caused significant disruption to individuals and businesses who relied on the bank to provide their accounts, loans and mortgages. In addition, it would have risked causing a loss of confidence in the UK’s financial system, potentially deepening the impacts of the financial crisis. As the Office for Budget Responsibility has stated, the costs of the financial crisis would almost certainly have been much greater in the absence of the interventions made to restore financial stability.
Since the global financial crisis, Government have implemented reforms to strengthen the ability to manage bank failures safely, and to do so in a way that protects the wider economy and minimises the need for taxpayer support. In addition, the development of a more robust regulatory structure ensures the resilience and stability of both individual firms and the wider financial system.
The capital provided resulted in the Government having an 84.4% shareholding in RBS. The Government sold shares through a combination of three accelerated bookbuilds (large block sales to market based investors), five directed buybacks (sales of shares back to NatWest), and a trading plan (which sold smaller amounts of shares regularly into the market). Sales took place only when it represented value for money for taxpayers.
Table 2: Details of all sales of the Government’s shareholding are summarised in the table below:
Table 3: Explainer of total amount received by Government in relation to NatWest shareholding:
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Flood Resilience and Coastal Erosion Consultation
(3 days, 18 hours ago)
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The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)
The first role of any Government is to protect their citizens. Yet the previous Conservative Government left flood defences in their worst condition on record. This is a dereliction of duty.
Economic growth is the No. 1 mission in the Government’s plan for change. Resilience and adaptation to climate change are essential foundations to this mission—better protecting all communities from the risk of flooding increases investor confidence, the viability of businesses, the resilience of critical infrastructure, innovation, and tourism. This is why we are investing a record £2.65 billion over the two years to March 2026.
We are committed to making every pound we invest count, and to ensuring that our flood resilience and coastal erosion investment policy enables new innovative approaches that respond to current challenges and prepare us for the future. Today, the Department has launched a consultation on reforming our approach to investing in flooding and coastal erosion for communities across the country.
We have a bold, strategic vision for the future. Our objectives are for the new approach to be simple, flexible, and strategic—so that we can deliver timely, data-driven interventions that build national resilience. It will have a stronger focus on investing in our existing assets and enabling a broader range of resilience interventions, including natural flood management and property flood resilience measures. It will be informed by a 10-year pipeline of project opportunities based on the Environment Agency’s new national flood risk assessment, which brings together key national and local evidence.
We want to ensure that funding for flood defences is distributed more effectively across the country—including for rural and coastal communities. We are proposing to stop using the current outdated funding formula entirely and replace it with a simple two-step process. The first step determines how much Government funding a project will get. We are proposing to fully fund the first £3 million of all projects and apply a flat rate of 90% Government contribution towards the remaining costs. This approach means that more schemes will see their funding gaps filled. It will make it simpler and faster for all risk management authorities to calculate their funding—benefiting all councils, including poorer councils that have less resource to commit to the application process.
We have also listened to stakeholders who have told us about their difficulties in securing external funding contributions for capital works to existing assets. We are therefore proposing to fully fund the refurbishment of existing flood and coastal erosion risk management projects to reduce these pressures.
The second step will be to prioritise projects for funding. We are seeking views in our consultation on a range of options, including prioritising by value for money; weightings to bolster priority outcomes, such as for deprived communities and natural flood management; and providing incentives for projects to secure additional external funding contributions.
The new approach for flood resilience investment will be launched in time for the start of our new flood investment programme in April 2026. Transitional arrangements will be put in place for existing projects in construction to ensure that all those projects are completed.
The Government are also opening a call for evidence on two wider areas. The first looks at how we can effectively find alternative sources of funding for flood and coastal erosion projects to achieve better outcomes for more stakeholders. The second explores opportunities for English devolution to support flood resilience, including how to deliver more local choice in flood risk management decisions and achieve wider benefits. It also invites views on the potential for mayors to help fund flood projects using mayoral revenue raising powers, on opportunities for improved partnership working and on the potential to devolve funding for local flood risk in the longer term.
We have recognised the challenges that our inherited approach to floods funding presents to communities across the country, including in rural, coastal and poorer council areas. This review of floods funding marks a step change in our approach to flood risk investment. Everyone with an interest in flood risk management—from local floods action groups and individuals to flood risk management authorities and private businesses—is encouraged to share their voice and help shape the future of floods funding.
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Independent Water Commission
(3 days, 18 hours ago)
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The Secretary of State for Environment, Food and Rural Affairs (Steve Reed)
Today, the Independent Water Commission has published an interim report setting out its preliminary conclusions on water sector reform.
In October 2024, the UK and Welsh Governments appointed Sir Jon Cunliffe, former Deputy Governor of the Bank of England, to chair the commission and make recommendations to reset the water sector in England and Wales.
The Government set the Independent Water Commission a considerable task in reviewing the water sector in its entirety. Our water system must serve both its customers and the environment, but we inherited one that did neither. I thank Sir Jon for his interim report.
Today’s report focuses on five key areas:
Strategic direction and planning
Legislative framework
Regulatory reform
Company structures, ownership, governance and management
Infrastructure and asset health.
I remain of the view that transformative change across the water sector is needed. We need to create the conditions to attract future long-term investment, ensure resilient finances and contribute to economic growth, while supporting affordable customer bills.
The Government will review Sir Jon’s interim findings in detail and look forward to receiving his final recommendations later this summer.
We will respond in full later this year following the commission’s final recommendations. This will include a detailed transition plan for the water sector. This will form the basis of further legislation to reset the sector and attract the investment we need to ensure its resilience for decades to come.
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UK-Morocco Partnership and Regional Stability
(3 days, 18 hours ago)
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The Secretary of State for Foreign, Commonwealth and Development Affairs (Mr David Lammy)
I should like to update the House on the United Kingdom’s deepening partnership with the Kingdom of Morocco, and our new position towards Western Sahara.
The UK and Morocco are long-standing partners, working together across a range of shared priorities. Our bilateral trade relationship is worth over £4 billion annually. We are strengthening this partnership to advance mutual goals in security, prosperity and sustainable development—delivering tangible benefits for British businesses and supporting the Government’s plan for change to boost economic growth.
On 1 June, during my visit to Morocco, I announced a series of partnership agreements that unlock opportunities for UK businesses across a range of sectors, including access to public procurement markets in Morocco, where opportunities are estimated to be worth approximately £33 billion over the next three years. On behalf of the Department for Business and Trade, I signed a Government-to-Government partnership that strategically positions British businesses to compete for contracts to develop Moroccan infrastructure for the 2030 FIFA world cup. In addition, I announced closer UK-Morocco co-operation on migration and counter-terrorism, and joint action to tackle water scarcity and climate change.
In parallel, the Government are advancing regional security, stability and prosperity by supporting efforts to resolve the long-standing Western Sahara conflict, which has persisted for nearly five decades. The conflict has undermined regional stability and hindered economic development, and particularly affects Sahrawi refugees residing in the Tindouf camps.
Approaching the 50th year of the conflict in November, and with renewed international engagement, there is a window of opportunity to shift the dial on this intractable conflict, and to support the parties and the UN to reach a just, lasting and mutually acceptable solution, based on compromise, which conforms with the purposes and principles of the UN charter, including the principle of respect for self-determination. The Foreign, Commonwealth and Development Office is redoubling its efforts to help realise this opportunity.
To this end, while in Morocco, I announced the UK’s endorsement of Morocco’s autonomy proposal as the most credible, viable, and pragmatic basis for a solution to the conflict. In parallel, I welcomed Morocco’s willingness, detailed in our joint communiqué, to engage in good faith with all relevant parties to provide further details on what autonomy could entail, with a view to restarting serious negotiations.
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Local Government Re-organisation
(3 days, 18 hours ago)
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The Minister for Local Government and English Devolution (Jim McMahon)
On 24 March I updated the House on the latest steps on local government reorganisation. This set out the commitment that all areas had shown to reorganising local government in order to achieve sustainable, efficient and streamlined local government for taxpayers. We are shifting power out of Whitehall and delivering strong, sustainable, unitary councils, capable of leading their communities, shaping neighbourhoods and convening local public service providers to improve outcomes for local residents. This is part of the wider project to fix the foundations of local government, and to create a system that is fit, legal and decent, with improvements to audit, finance, standards and structures, complemented by devolution, fair funding and a resetting of the relationship with central Government to gives councils the power they need to get things done. Area Allocation Cambridgeshire and Peterborough £318,816 Derbyshire and Derby £350,582 Devon, Plymouth and Torbay £383,326 East Sussex and Brighton £302,024 Essex, Southend-on-Sea and Thurrock £514,318 Gloucestershire £266,855 Hampshire, Isle of Wight, Portsmouth and Southampton £542,174 Hertfordshire £378,077 Kent and Medway £514,410 Lancashire, Blackburn and Blackpool £449,075 Leicestershire, Leicester and Rutland £365,888 Lincolnshire, North Lincolnshire and North East Lincolnshire £357,246 Norfolk £321,389 Nottinghamshire and Nottingham £369,754 Oxfordshire £285,046 Staffordshire and Stoke-on-Trent £367,336 Suffolk £290,288 Surrey £380,734 Warwickshire £258,565 West Sussex £315,172 Worcestershire £257,837
All 21 two-tier areas produced interim plans with this Government’s commitment to support them, including by giving feedback on interim plans, providing £7.6 million to support the development of final proposals and practical advice and support. I am now updating the House with a summary of the feedback provided to areas, and the proposed allocation and payment of proposal development contributions.
Proposal development contributions
In the statutory guidance I outline my expectation for all local leaders to work collaboratively and proactively by sharing information and data to develop robust and sustainable unitary proposals that benefit the entire area. Ideally, I would like areas to submit their final proposals as a single submission, underpinned by a shared evidence base, that includes all options being put forward by councils.
Consequently, I expect proposal development contributions to support this effort. Each of the 21 areas will receive a flat rate of £135,000, plus an additional 20p per person based on the latest Office for National Statistics population estimates. The allocation is as follows:
Areas have been asked to agree on up to three councils to receive an equal share of the funding, which will contribute towards facilitating the development of a shared evidence base that will underpin the final proposals as well as contributing to the development of these. This includes areas sharing non-public data to ensure that all proposals are supported by the same robust evidence and analysis. This could include shared baseline data, which has been quality-assured, on key issues such as financial sustainability, service expenditure, impacts on outcomes, service delivery quality and potential changes in sources of income. This could be supported by a memorandum of understanding and a data-sharing agreement. The Local Government Association has published helpful data-sharing principles and a checklist that areas could utilise. The Department will be continuing to engage closely with areas as they develop proposals, to ensure that data is being shared as required. Shortly, the Chartered Institute of Public Finance and Accountancy and F3 Consulting will also release a template to support the presentation of financial information in proposals. This template, or any future templates, are not mandatory, but I expect all areas to agree on the consistent presentation of evidence for their area, recognising that it may still be used to support a range of alternative proposals.
Once areas have notified their Ministry of Housing, Communities and Local Government area lead of the authorities to receive the funding, we will make payments as soon as possible. If areas are unable to reach an agreement on up to three authorities to receive an equal portion of the fund to support the development of proposals across the area, or meet my expectations for a single submission and data sharing, we are ready to provide support.
Feedback and support
I know that areas are seeking further clarity on developing their full proposals. My officials have provided individual written feedback to each area and are in the process of meeting with areas to discuss that feedback. Areas have been encouraged to share that feedback with MPs. Today I am publishing a summary of the feedback to support all areas in progressing their proposals and in the interests of transparency; I will deposit a copy of that document in the Library of the House. Included in the feedback is a reiteration of the Government’s position that a population size of 500,000 or more is a guiding principle, not a strict target. We understand the need for flexibility, especially given our ambition to build out devolution and take account of housing growth alongside local government reorganisation. All proposals, whether they are at the guided level, above it or below it, should set out the rationale for the proposed approach clearly. The approach that we have taken from the outset encourages and allows for councils to determine the right fit for their area. What works in one area may not apply in the same way in another, and so it is right that the process allows for flexibility.
Local government reorganisation should facilitate better and sustained community engagement, and I welcome the steps that areas are taking to consider how to maintain strong community voice. A simplified and standardised system of local area-working and governance is needed, and neighbourhood area committees, led by frontline ward councillors, are the best route to achieve this. Neighbourhood area committees support local authorities to deliver their commitments to community partnership working at a neighbourhood level. There are also opportunities to bring other service providers into broader membership of neighbourhood area committees—for instance, town or parish councillors, where they exist, and co-opted members from other local community organisations. This allows for the benefit of structural efficiencies from local governance reorganisation while deepening localism and engagement across every community.
The priority for the next phase is supporting areas to establish a shared evidence base that will underpin the development of final proposals, and to co-produce solutions to challenges identified by areas in this first phase—whether it is improved service delivery, funding reform, maintaining a strong community voice, achieving sensible geographies or preparing for devolution in tandem.
We are committed to working with colleagues across Government, and with the LGA and its sector support group, to ensure that councils have the information, tools and expertise to develop the solutions that are right for their area, so that new authorities are set up for success. No proposal will be perfect, but nor should we let the perfect be the enemy of the good. Local government has proven its adaptability and resilience, so the most important thing is that we establish new authorities that can continue to evolve and develop with their communities.
Surrey
I am pleased to inform the House that we received proposals for unitary local government from councils in Surrey, and I will provide the House with a full update shortly.
Conclusion
I understand that developing proposals and preparing for local government reorganisation is demanding, and that for areas with new councillors and leaders this is a particularly busy time. I want to reiterate my commitment to working with every area to deliver on this ambitious programme. I am also aware that developing proposals could distract councils from their essential day-to-day activities. However, residents and businesses depend on councils to provide vital services and continue the work necessary for creating successful new unitary councils. This is especially true for progressing local plans, to allocate land for the new homes that we so desperately need. Accordingly, as stated in my invitation letters, I continue to expect local planning authorities to work towards the adoption of an up-to-date local plan as soon as possible. Local government reorganisation should not hinder this essential work; and neither should the introduction of the new legal framework for local plan-making later this year, or our strategic planning reforms. Significant financial assistance has already been provided to eligible authorities to support plan-making, and I urge authorities to make the most of other support available through the LGA’s planning advisory service. Together, we can ensure that our reorganisation efforts are successful and deliver the high-quality public services that our residents deserve.
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Machinery of Government: Cyber-security and Defence Exports
(3 days, 18 hours ago)
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The Prime Minister (Keir Starmer)
I am making this statement to bring to the House’s attention the following machinery of Government changes.
I am today announcing that responsibility for Government and public sector cyber-security will move from the Cabinet Office to the Department for Science, Innovation and Technology. This change will strengthen technology resilience and policymaking across the public sector by better integrating cyber-security responsibilities and expertise into the Government Digital Service. This change is effective immediately.
I am also confirming that responsibility for defence exports promotion—comprising the majority of UK Defence & Security Exports—will move from the Department for Business and Trade to the Ministry of Defence. In line with the defence industrial strategy, this will enable the Government to develop a single defence exports offer, driving a significant and sustained improvement to performance while giving stronger backing to our world-class defence industry. It will directly connect exports with the MOD’s wider procurement and international activity. The creation of a single Departmental lead for defence exports will deliver on the Government’s first mission of delivering economic growth as well as their first duty of protecting the UK. Responsibility for security and cyber exports will remain in the Department for Business and Trade. This change will take effect on 31 July.
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