Jul 2024
Labour, private equity and investment
Working with private equity, investment and financial organisations for several years, we understand that even the smallest changes can have a significant impact, but what does a new Labour Government mean for these firms, and how can our technology and consulting experts support them? Amongst a number of manifesto, and now Government emerging policy, we’ve highlighted a few where we see opportunity to further support the sector.
Sector Principal - Private Equity
Public Private Partnerships (PPPs)
Labour plans to rely heavily on private investment to rebuild Britain’s public services, spotlighting financial services, which it describes as ‘one of Britain’s greatest success stories’, and potentially providing opportunities for Private Equity (PE) firms to invest in large-scale projects that the government may otherwise be unable to provide. That said, bringing in a consultancy expert like Waterstons to assess the baseline of any existing business, projects and/or services is vital before investment to understand the true starting position.
Great British energy
Capitalised with £8.3bn over the course of the next parliament, the publicly-owned enterprise will be mandated to partner with industry and trade unions to deliver clean energy. The first £3.3bn of funding will be allocated towards small community-led, on-shore wind and solar projects with the remaining £5bn used as initial investment capital for the company’s investments in emerging energy technologies.
Although this will take time to deliver the impact aimed for, this project will provide an opportunity for a variety of organisations to support and expand the development of both vertical and horizontal infrastructure and support services.
With many PE firms aligning portfolios within the energy sector, there is significant value to be created from vertical integration, with the support of experts within energy and critical national infrastructure.
Business taxes
Labour has committed not to raise VAT, income tax, National Insurance or corporation tax rates, although they do propose replacing business rates with a new system to level the playing field between the high street and online giants.
While this brings greater certainty to the looming business taxation changes, it may have an impact on the rate changes for firms with significant holdings in online B2C investments. With a fairer model, this provides full expensing for capital investment, and will maintain a competitive corporation tax rate capped at the current 25%, signal a pro-business and pro-markets stance.
With greater potential tax positive implications for business, this may encourage investment interest in 'bricks and mortar’ businesses, as well as within IT capital; an area of expertise for Waterstons from due diligence to implementation.
Get in touch with Bruce Watson to find out more about Waterstons experience within Private Equity.