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Shipbuilding Credit Guarantee Scheme

Volume 750: debated on Friday 24 May 2024

The shipbuilding credit guarantee scheme is a finance instrument that provides guarantees to banks in respect of loans made to vessel owners and operators seeking to place orders at UK shipyards. The scheme was launched in July 2023 and the Department for Business and Trade is the accountable Department.

The export credits guarantee department—operating as UK Export Finance, or UKEF—acts as service provider to the Department for Business and Trade via a memorandum of understanding. UKEF manages inquiries and applications under the scheme, as well as assisting with the set-up and implementation of the scheme, and DBT covers resource and other costs. In order to have the necessary approvals to progress actual transactions, or potential transactions, on behalf of DBT, ECGD must apply for a Contingencies Fund advance to cover the vote on account period in financial year 2024-25. This Contingencies Fund advance of £90,000 was made over recess, and I am notifying Parliament at the earliest opportunity.

Parliamentary approval for additional resource of £90,000 for this new service will be sought in a main estimate for the export credits guarantee department. Pending that approval, urgent expenditure estimated at £90,000 will be met by repayable cash advances from the Contingencies Fund.