The Chancellor Rachel Reeves has announced multi-billion-pound funding for tech initiatives in the Spending Review.
At a time when other Government departments have seen their budgets cut – it’s clear the government has reaffirmed its commitment to technology as central to its mission for growth.
Key announcements:
- Investing up to £10 billion in NHS technology and digital transformation by 202829. The Chancellor said this will "bring our analogue health system into the digital age, including through the NHS app". This is part of an extra £29 billion per year package for the day-to-day running of the health service.
- The Department for Science, Innovation and Technology to get an extra £1.2 billion – much of which will be investments in AI to improve the delivery of public services. This is an increase, say analysts of just over seven percent on its current budget.
- £22.6 billion per year by 2029 for Research and Development in support of the government’s forthcoming modern Industrial Strategy. The Chancellor said: "We want high-tech industries in Britain today to continue to lead the world in the years to come.. we are backing our innovators, backing our researchers and backing our entrepreneurs."
- There will be £1.2 billion a year to support over a million young people in to training and apprenticeships: "We must give our young people the skills that they need to contribute to our national success as scientists, engineers, and designers, as builders, welders, and electricians."
- £2 billion to support the AI Opportunities Action Plan - including a 20-fold increase in support for compute capacity, with £160 million for TechFirst to ensure people have the right skills to deliver technological change.
Nuclear
The Chancellor announced the "biggest rollout of nuclear power for half a century". This is a sector where technology is central, and the Chancellor said there will be a £30 billion investment in this area. This sum includes the Government's commitment to the Sizewell C nuclear plant, announced yesterday, as well as the re-announcement of investment in small modular reactors and a £2.5 billion investment in nuclear fusion.
The Spending Review also confirmed £300 millions of Great British Energy support for Offshore Wind supply chains.
Defence
Another sector where technology is a significant factor is defence, with the Chancellor reaffirming that this will rise to 2.6% of GDP by April 2027 with an ambition to reach 3% in the next Parliament.
BCS response
Regarding the digital transformation of the health service, Will Smart, Chair of the BCS Faculty of Health and Care said: “I strongly welcome the Government’s announcement of significant additional investment in digital for the NHS.
”BCS looks forward to working with colleagues across the government and the wider NHS to accelerate the transition from analogue to digital services, benefiting patients and staff.
“We hope to see investment in the professionals across the service that will deliver, support, and maintain these digital services.”
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BCS Fellow Dr Bill Mitchel OBE said: “In a world of geopolitical uncertainty, where climate change is starting to impact lives around the world, and where people are struggling with the cost of living, the UK really needs to invest seriously in building a sustainable vibrant economy.
“Thankfully it looks like the government has realised this and is putting significant funds into R&D, adoption of emerging technologies and developing the skills needed to make sure artificial intelligence is a success story for the UK.
“Let’s hope policy delivery matches the ambitions laid out in today’s Spending Review”
BCS Fellow and AI strategist Sarah Burnett said: “This is a landmark investment in AI, and the government deserves credit for the sheer scale of it. The headline figures are genuinely impressive and send a strong signal that the UK is serious about competing on the global tech stage.”
“The £2 billion for the AI action plan and the commitment to raise R&D spending to £22 billion across sectors are exactly the kind of strategic, high-level investments we need.
“Looking ahead at the people and skills aspect, the investment in apprenticeships and the "TechFirst" initiative are a great start for building our future talent pool.
“To complement this, I'd like to see more emphasis on lifelong learning to allow people to change jobs as more and more work gets automated in the future.
“Creating a framework for mid-career skills development would ensure that the benefits of AI are felt across the entire workforce, not just by new entrants. This would help millions of experienced workers in fields like logistics, administration, and customer service to adapt and transition into new roles, empowering them to work alongside these new technologies.”
The full text of the Spending Review can be found here and a summary of the Chancellors Speech is available here.
