8.36 The Government recognises that financial structures evolve over time as new sources of finance emerge from types of investors other than those who have typically owned and managed these assets in the past. The pension fund industry has expressed interest and a willingness to invest significant financial resources, in the ownership and management of UK infrastructure assets to provide long term stable returns to match maturing liabilities.
8.37 Some pension funds have expressed a preference for lower levels of debt in the capital structure to reduce financial risk. Depending on the equity return requirements of these investors, this has the potential to reduce the overall cost of finance, resulting in better value for the taxpayer.
8.38 Government remains committed to reducing the overall financing cost and using long term financing for long term projects. It welcomes engagement with pension and infrastructure funds and other financial investors as it considers the full range of delivery options that might meet its objectives for the next generation of infrastructure investment.