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The Spending Review 2025 (SR25) has been published setting departmental budgets for day‑to‑day spending until 2028‑29 and for capital investment until 2029‑30. Total departmental spending now reaches £717bn in 2028-29 (up from £648bn in 2025-26). As always, there are winners (e.g. health and defence) and losers (transport and official development assistance), but the devil is in the detail.
Although Chancellor Rachel Reeves announced that total departmental budgets will grow by 2.3% in real terms (accounting for inflation) across the Spending Review (SR) period, this uses 2023-24 as a baseline. If the current year (2025-26) is used as the baseline instead, this growth figure drops to just 1.5%. This figure is bolstered by increases in capital funding; total day-to-day spending over the 2025-26 to 2028-29 period increases by just 1.2% in real terms.
Beneath the headlines about record NHS investment (£10bn invested in NHS technology by 2028-29), strengthening UK security and driving economic growth, also lies a wide-ranging digital transformation agenda. With an explicit commitment to “deliver a step change in digital and AI investment across public services", SR25 will drive new opportunities for tech suppliers.
In this HotViewsExtra article we look at the key announcements in yesterday’s Spending Review and the implications for tech suppliers. This includes building the digital foundations; funding for innovation and the digital centre of government; the impact on health, defence, local government, education and police; the digital skills challenge; and how suppliers should position themselves for success.
TechMarketView subscribers, including UKHotViews Premium subscribers, can read ‘Spending Review 2025: Digital transformation takes centre stage’ here. If you aren't a subscriber—or aren't sure if your organisation has a corporate subscription—please contact Belinda Tewson to find out more.
Posted by: Dale Peters at 10:36