The UK faces major infrastructure challenges, particularly in housing, healthcare and education, worsened by high government deficits and borrowing. In response, the new Labour government plans budget cuts and possible tax increases, underlining the need for alternative funding approaches.

A key proposal is to boost private investment in social infrastructure, drawing lessons learnt from past models like the flawed Private Finance Initiative (PFI). The Welsh Government's Mutual Investment Model (MIM) offers a promising alternative, but carries similar risks.

Andrew Baum, Emeritus Professor, University of Oxford & Chairman of Newcore Capital, advocates for strategies such as the Mansion House Compact to direct institutional investments – especially from local government pension funds – toward critical services like education, healthcare and affordable housing. This could align financial returns with social impact.

Successful examples, like Newcore’s investment in childcare properties, show how these investments can be both profitable and socially beneficial. The piece stresses the need for responsible, impact-driven investment management, ideally involving mission-aligned firms like B Corporations. The ultimate goal is to create partnerships that deliver both financial and community value.

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