HM Treasury confirmed on 20 November that Aegon UK, NatWest Cushon and M&G are in the final stage of approvals to participate in an initial £200 million fundraise for the British Growth Partnership Fund, following a Downing Street meeting with the Chancellor Rachel Reeves and the Pensions Minister Torsten Bell.
The British Business Bank (BBB) says these providers are its partners for a targeted first close of £200 million by the end of the 2025/26 financial year, enabling initial investments to begin in 2026. British Growth Partnership Fund I will invest directly, co-investing alongside the Bank’s venture and growth managers on a fully commercial, arm’s‑length basis. Langham Hall will provide fund administration, depositary and AIFM services, with advisory input from Isio.
According to HM Treasury, the vehicle is intended to channel more institutional capital into later‑stage UK companies across clean energy, fintech, advanced manufacturing and medical technology, supporting scale‑ups to grow in the UK.
BBB notes that investment due diligence has been completed and terms are being finalised. Any investment by the Cushon Master Trust remains subject to trustee approval, while M&G is working towards participation at first close. BBB is also engaging further potential investors, including London CIV.
Alongside the fund, BBB intends to launch a Venture Link initiative for pension funds. The Bank will publish enhanced information on its venture commitments and consult on design to help schemes build capability and address barriers to investing in UK venture capital.
HM Treasury frames the British Growth Partnership as part of a wider agenda to mobilise pensions capital into ‘productive assets’. Government communications state BBB aims to raise at least £2 billion from pension funds over five years through this and related initiatives.
This sits alongside the Mansion House Accord, under which 17 workplace pension providers have signalled plans to allocate at least 10% of DC default assets to private markets by 2030, with a minimum 5% in UK opportunities-an approach expected by industry bodies and government to direct around £50 billion into the domestic economy by the end of the decade.
Structural reform is advancing in parallel. The government has proposed doubling the number of £25bn‑plus ‘megafunds’ by 2030 through DC market consolidation and pooling within the Local Government Pension Scheme, citing international evidence on scale and investment capability. Relevant measures are contained in the Pension Schemes Bill.
To build a consistent investment pipeline, ministers last month launched the Sterling 20 coalition of large pension providers and insurers to coordinate capital towards UK infrastructure and high‑growth sectors, complementing the Accord commitments.
For schemes, the British Growth Partnership and Venture Link create a clearer route into UK venture exposure, but governance steps remain central: trustee approval processes, liquidity management for illiquid allocations, and alignment with the forthcoming value‑for‑money framework and default decumulation duties proposed in the Pension Schemes Bill.
Next milestones include BBB’s targeted first close by March 2026 and the Pension Schemes Bill’s remaining Commons stages, with report and third reading to be scheduled. BBB indicates it will continue onboarding institutional partners ahead of initial deployments.