The UK Chancellor has announced significant funding measures in the latest Spending Review, revealing a commitment of £39 billion towards social and affordable housing. This massive one-time investment puts a significant down payment on addressing the persistent housing shortages. More vulnerable populations are served in accordance with its title.
Last week the Chancellor unveiled his Spending Review, which included a 2.8% annual rise for the Department for Health. This decision reaffirms the federal government’s responsibility to ensure quality healthcare, along with healthcare services, not just housing. Yet, surprisingly, the education sector quickly became the biggest beneficiary, reeling in one of the biggest funding increases covered in this analysis.
Capital expenditure on transport will increase by 3.9% – providing a much needed boost to infrastructure improvements across the country. The Chancellor’s announcement comes on the heels of a historic win for the administration. They secured an additional £113 billion in capital spending thanks to redrawn borrowing rules that offer the region increased fiscal flexibility.
The education budget will be upped by another 1.8% per year on top of that. While still high, this increase is the second-largest increase in the recent review cycle. This funding is well-positioned to advance a number of high-quality educational activities and fill resource gaps within schools across the country. The Department for Education will see an increased budget. With most of this money to be spent on old debts, don’t expect a lot of new money in real terms every year.
We were particularly pleased to hear the Chancellor’s recognition of the essential importance of research and development (R&D) funding. From 2029/30, this funding will be ramped up to more than £22.6 billion annually. The UK’s Campaign for Science & Engineering celebrated implementation of this commitment. They pointed out that this historic increase acts as a shield for R&D against these tough fiscal pressures.
“We should be looking to lead” – Adrian Smith, President of the Royal Society
And the National Health Service (NHS), which has recently been clamoring for funds, will get a 3% annual real-terms increase in spending. This increase reflects the government’s dedication to addressing the growing demand for quality healthcare services.
As his first act, the Chancellor has put £700 million on probation reform. This investment will improve rehabilitation opportunities, keeping communities safer by lowering recidivism rates and increasing public safety and community support networks.
The Home Office is staring down the barrel of a 1.7% budget cut. At the same time, the department for Environment, Food and Rural Affairs (Defra) will face an even bigger cut of 2.7%. Additionally, the Foreign Office is facing a more significant cut of 6.9%, raising concerns about the impact on international relations and foreign aid efforts.
Transportation investments are set to grow explosively. The £7 billion set aside by the government for this ambitious building programme is more than double the £4.7 billion previously announced. They will now spend more than £15.6 billion on new trams, trains and buses away from London. This is a clear indication of the federal government’s commitment to increasing public transport accessibility throughout the country.
“We are happy bunnies” – A representative from the Department for Transport (DfT)
Housing advocates reacted with guarded optimism to the Chancellor’s capital investment in housing announced last week. As housing correspondent Tarah Welsh described it, the bill was a “game changer.” Shelter’s Charlie Trew called it a “watershed moment” for addressing housing needs across the UK.
