The review outlines day-to-day budgets for government departments over the next three years to support staff pay and public services, alongside long-term investment plans for infrastructure projects such as schools, transport, and defence equipment.
Key announcements include:
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A 3% real-terms increase in the NHS day-to-day budget in England, reaching £226 billion by 2029.
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A 0.4% real-terms average rise in core schools funding in England, reaching £69.5 billion by 2029.
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A 0.7% real-terms rise in the Ministry of Defence’s day-to-day budget, alongside a significant 7.3% annual average increase in investment spending.
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£39 billion allocated for social housing in England between 2026 and 2036 — an average of £3.9 billion per year, up from £2.3 billion currently.
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£15.6 billion earmarked between 2027 and 2031 for transport projects in English city regions outside London.
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A 7.4% real-terms annual increase in the Department for Science, Innovation and Technology’s day-to-day budget.
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A 0.5% rise in the Department for Energy Security’s day-to-day spending, with a 2.6% increase for investment.
How Has the Manufacturing Sector Responded?
Stephen Phipson, Chief Executive of Make UK, said:
“Industry will view this statement through the lens of the delicate balancing act the Chancellor is navigating, given tight public finances, a challenging economic backdrop, and the need to maintain fiscal credibility.
Within that framework, the boost for defence, science and technology, and investment in transport outside London and the South East is welcome. These are vital steps to unlock growth in regional economies where manufacturers play a crucial role.
However, the spotlight will now turn to the forthcoming Industrial Strategy. Industry urgently needs a funded, joined-up, long-term vision to support stability and investment. Crucially, bold action is needed on the UK’s disproportionately high industrial energy costs and the persistent skills crisis. Addressing these two issues could be game-changing for the competitiveness and growth prospects of UK manufacturers.”
Ann Watson, CEO of skills charity Enginuity, welcomed the measures, stating: “Today’s Spending Review signals valuable government support for the UK’s priority industrial sectors, with significant capital investment committed to clean energy, defence, and transport. This will generate demand across industrial supply chains, offering SMEs the confidence to help realise the Government’s economic and decarbonisation goals.
With fiscal parameters now set, the essential next step is a comprehensive Industrial Strategy providing clarity, detail, and actionable policies to set a clear direction for UK industry.
We’re also pleased to see acknowledgment of the role of skills investment, with £1.2 billion in additional annual funding by 2028–29. Its true impact, however, will depend on allocation, delivery, and the forthcoming post-16 education strategy.”
John O’Connell, Chief Executive of the TaxPayers' Alliance, took a more critical stance: “Taxpayers face the prospect of harsh austerity as they brace for yet more tax hikes this autumn, funding an oversized and inefficient public sector.
Politicians have again failed to tackle spiralling welfare costs and support people back into work, which only hastens an inevitable fiscal crunch.
Public spending must be brought under control to cut taxes and reduce national debt. That requires politicians to side with taxpayers and businesses — something this review clearly fails to do.”
Andrei Danescu, CEO and co-founder of UK robotics and AI firm Dexory, focused on the tech and innovation implications:
“The £86 billion earmarked for science and technology is a bold headline figure, but to deliver real results, it must reach the right builders. The UK needs targeted backing for deep-tech companies scaling hardware, AI, and robotics — not just more grants for policy think tanks or spin-outs that never leave prototype stage.
Money alone won’t fix systemic issues. Deep-tech founders face rising operational costs, regulatory delays, and talent shortages. What’s needed is a reduction in red tape and more operational freedom.
If the UK is serious about global leadership, it must match the ambition of international competitors, offering tax breaks, loan guarantees, and subsidies to de-risk bold innovations. This package is a start — but its impact will depend on effective delivery.”
Responding to the Government's announcements, Professor Fiona Rayment OBE, President of the Nuclear Institute said: “We strongly welcome the Government’s announcement of funding and support for the nuclear industry, which has a key role to play in meeting its energy security, national defence and economic ambitions.
“Support for Sizewell C represents an important step towards ensuring that we have the infrastructure needed to meet the country’s long-term energy needs.
“The funding for Sizewell C will drive the delivery of large-scale, clean energy, while investment in SMRs positions the UK as a global leader in innovative nuclear technology.
“This follows a welcome commitment to supporting nuclear defence, announced in the Strategic Defence Review last week. This review outlined a vision for future-proofed and innovative approach, of which nuclear forms a key part, ensuring robust capabilities, job creation, and long-term national security.
“The government is also right to recognise that pace of delivery matters. We are at a critical moment. The backdrop of global political challenges and the impacts of climate change mean nuclear power has never been more vital. Nuclear power provides a stable, carbon-free energy source, enhancing energy security through readily available fuel supplies and UK-based infrastructure.
“Beyond this, the nuclear sector is a huge contributor to the UK economy, supporting around 87,000 jobs, with up to 40,000 net new entrants needed by 2030 to keep pace with the growth of the sector. There is a severe skills shortage of nuclear workers in the UK. This investment needs to help address that skills gap and futureproof the sector.
“As a membership body, we continue to work closely with Government and will continue to advocate for our members who are delivering what our country needs. Our members stand ready to ensure these projects are delivered efficiently and effectively and we look forward to seeing the UK deliver a cleaner, more secure energy landscape for generations to come.
“Now we focus on delivery.”
Dunstan Power, Director of ByteSnap Design and its electric vehicle charging division, Versinetic, has another opinion though and argues:
“It is true that keeping vehicles on the road has environmental benefits, as new car production has a significant impact. However, older cars tend to also be the most polluting, so this is a complex trade-off. It is bizarre however, to suggest that electrification is a threat to energy security when the reverse is true – fossil fuels are predominately sourced from abroad and all supplies are finite and increasingly difficult to mine.
“Electrification and renewables are actually paths to energy security. EV car prices are tumbling, EVs outlast their petrol equivalent and have a fraction of the running costs. Norway shows that it is possible for countries to transition away from legacy petrol vehicles where there are sufficient tax incentives and once that is done future generations will probably scratch their heads and wonder what all the fuss was about.”
Dr Graham Hoare OBE, CEO of the Manufacturing Technology Centre (MTC) said: “The Chancellor’s statement is a welcome recognition that “energy security is national security.” The commitment to the largest rollout of nuclear power in half a century, alongside investment in building the nuclear workforce of tomorrow, is a vital step in preparing the UK for the future.
“The announcement of over £3 billion in R&D and capital funding for advanced manufacturing over the next four years is particularly significant. This has the potential to unlock further investment across the UK and strengthen the foundations of the country’s industrial base to drive innovation, resilience, and long-term economic growth. These are areas where the MTC is proud to play a leading role and we look forward to working with Government and industry to turn this ambition into action.”
