Britain’s state investment institutions can’t compete with Europe’s Outdated fiscal accounting is holding us back 17 August 2026 There has been much talk recently of Burnham’s options for increasing the firepower of state investment institutions. Whether national-level public finance institutions (PuFIns) like the National Wealth Fund (NWF), or local-level ones such as the proposed regional public development corporations (PDCs), state institutions with real firepower have a much greater role to play in a country whose infrastructure is crying out for investment. There are a few ideas on the table. Resolution Foundation has suggested £9bn increased firepower for the UK’s green policy bank, the NWF. This would certainly be a good place to start. It would edge us back towards the volumes of public finance for investment that used to be channelled to us via the European Investment Bank before Brexit. But when you look over to our continental neighbours –such as France and Germany, this volume pales in comparison. Matching the roughly 1% of GDP a year that the German and French state-owned development banks — KfW and Bpifrance — each invest would mean the NWF investing around £21bn annually by 2028 – 29. This is nearly four times its current annual cap. On a regional level, infrastructure expert Thomas Aubrey has suggested that rescuing the government’s new towns programme would mean reviving something similar to the old PDC model. Owned by mayoral authorities, PDCs could borrow against specific revenue streams in the way Britain’s postwar new towns and infrastructure once did, rather than routing everything through gilts and general taxation. Public corporation debt in the Netherlands funds assets worth nearly 80% of GDP, and underpins a self-funding, regional delivery model that has historically delivered around six housing completions per 1,000 people, nearly double the UK’s long-run rate of roughly 3.5. Why do European state investment institutions seem so much...