Nesta, a quango which had its funding cut in the 2010 Spending Review, is to become a charity following a government consultation which indicated broad support for the proposal.

Announcing the results of the consultation on Friday, the government also advised that universities and science minister David Willetts had laid an Order in Parliament seeking approval to abolish the quango. 

Under the plans the National Endowment for Science, Technology and the Arts (Nesta) will become an independent charity and a charitable trust to manage the National Lottery endowment, subject to approval by the Charity Commission.

The transition is expected to take place in April 2012. The government said the National Lottery endowment needs to stay in the public sector as the majority is invested in government gilts and sits as a liquid asset benefitting public sector net debt. So transferring the endowment out of the public sector would reduce the stock of government assets and have a detrimental effect on public sector net debt.

The response to the consultation on the proposal, carried out last autumn by the Department for Business Innovation and Skills (BIS), indicated broad support for the plans with 23 out of the 27 respondents agreeing with the government’s preferred option.

The government announced its intention to turn the National Endowment for Science, Technology and the Arts (Nesta) into a charity as part of its quango cull in October 2010 at the same time as it announced British Waterways would also be turned into a charity.