Spending review 2025: The key announcements

Published

3 weeks ago

June 11, 2025

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Rachel Reeves has set out her spending review in the House of Commons.

It outlines how much day-to-day funding government departments will get over the next three years, until 2029, which is used on things like wages.

It also covers a department’s investment (also known as capital) budget over the next four years, until the end of 2030. This money is used to pay for things like new infrastructure projects.

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The last spending review was held during the COVID-19 pandemic, and before that, in 2015.

Here’s what’s been announced:

Department winners and losers

Sky News’ data and economics editor, Ed Conway, has crunched the numbers to see which government departments have benefited after the spending review, and which have seemingly lost out.

In the chart below sets out which departments are getting the biggest increase in their day-to-day budgets.

The second chart maps the biggest increases in capital spending.

Defence

A major recipient of funds is the Ministry of Defence. Defence spending will rise from 2.3% of gross domestic product (GDP) to 2.6% by 2027. This equates to an £11bn uplift and a £600m uplift for security and intelligence agencies.

Within that there’ll be £4.5bn of investment in munitions made across the country and more than £6bn to upgrade to nuclear submarine production.

The department is one of the biggest winners of the spending review.

In total, an extra 3.8% will be spent from this year to the end of 2029, when the spending period ends.

Much of that increase will be capital spending – a rise of 7.3%, whereas day-to-day spending will only go up 0.7% in the same period.

Ms Reeves said it was because of cuts to foreign aid that such defence rises are possible.

The Foreign, Commonwealth and Development Office was among the biggest losers, with spending set to fall 8.3% in total over the next three years.

Its capital spending will drop 6.8%, with day-to-day spending down 6.9%.

NHS

The chancellor announced an extra £29bn a year will be spent on the NHS, an annual rise of 3% on current levels.

She says she is increasing the NHS technology budget by almost 50%, and £10bn to bring the “analogue health system into the digital age”.

The department in control of the NHS, the Department of Health and Social Care, is also a “real big winner”, Ed Conway says.

Day-to-day spending will rise 2.8%, while there will be no increase in capital expenditure.

Asylum and border security

The chancellor says border security funding will increase, with up to £280m more per year by the end of the spending review for the new Border Security Command.

She said the Home Secretary Yvette Cooper will end hotels being used to house asylum seekers by 2029.

The chancellor says funding she has announced today, including from the transformation fund, will also cut the asylum backlog, see more appeal cases heard and “return people who have no right to be here”.

This will save the taxpayer £1bn a year, she claimed.

As a result of these savings, the Home Office will have 1.4% less to spend by 2029, compared to this year.

Broken down on a day-to-day basis, it’s a 1.7% drop but a 0.7% rise in capital expenses.

Education and training

The chancellor confirmed that free school meals will be extended to over half a million more children and said that the policy will lift 100,000 children out of poverty.

Nearly £2.3bn a year will go to fix crumbling classrooms. A further £2.4bn will be spent on rebuilding 500 schools.

Another record investment amount was announced by Ms Reeves for training and upskilling – £1.2bn a year by the end of the spending review will go to support more than a million young people into training and apprenticeships.

School-based nurseries have been given £370m. The core schools budget is rising by £3.5bn a year.

Housing

Government funding of social and affordable housing has been allocated £39bn, over the next 10 years – which Ms Reeves called the “biggest cash injection into social housing in 50 years”.

She says she is providing an additional £10bn for financial investments, to be delivered through Homes England, to help unlock hundreds of thousands more homes.

Energy

A commitment to nuclear power was reiterated, with £30bn allocated.

Of this, £14.2bn is being poured into the Sizewell C nuclear power station – which was announced earlier this week – on the Suffolk coastline.

Another £2.5bn will be invested in a new small modular reactor programme.

Science and technology

The chancellor says she wants the country’s high-tech industries in Britain to continue to lead the world in the years to come.

Research and development funding will go to a record high of £22bn a year by the end of the spending period.

Artificial Intelligence

The chancellor has backed “home-grown AI” with a £2bn investment.

She says the technology has the potential to “solve diverse and daunting challenges” and create “good jobs”.

Transport

The chancellor announced £15bn for new rail, tram and bus networks across the West Midlands and the North. She’s also given the green light to a new rail line between Liverpool and Manchester.

She says investments in buses, train stations, metro lines and transit will be made in places including Rochdale, Merseyside, Birmingham and West Yorkshire.

In London, Ms Reeves says there will be a “four-year settlement” for the Transport for London and a “fourfold increase” in local transport grants by the end of this parliament.

As expected, the £3 bus cap has been extended to March 2027. It had been £2 up to the end of 2024.

Justice

To fund 14,000 new prison places, £7bn will be invested, with £700m a year going to reform the probation system.

In order to reach the goal of 13,000 more police officers in England and Wales, £2bn will be allocated.

Nations

On the nations of the UK, the chancellor announced:

• Scotland has been allocated £52bn
• Northern Ireland has been allocated £20bn
• Wales has been allocated £23bn.

UK

Diogo Jota: Liverpool players join mourners as Premier League star and his brother Andre Silva buried in Portugal

Published

5 hours ago

July 5, 2025

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Diogo Jota: Liverpool players join mourners as Premier League star and his brother Andre Silva buried in Portugal

Liverpool players past and present have joined the family and friends of Diogo Jota and his brother Andre Silva for their funeral in Portugal.

A service was held in the Igreja Matriz de Gondomar church in their hometown of Gondomar near Porto in northern Portugal on Saturday morning.

Mourners lined the streets and some in the crowd clapped as the brothers’ coffins were carried into the church.

The funeral – in pictures

Jota, 28, leaves behind his wife of only 11 days, Rute Cardoso, and three young children.

His younger brother, 25, was an attacking midfielder for Penafiel in the second tier of Portuguese football.

Liverpool manager Arne Slot, captain Virgil Van Dijk and teammates including Andy Robertson, Conor Bradley, Ryan Gravenberch, Cody Gakpo, Curtis Jones, Darwin Nunez and Joe Gomez were seen at the service.

Former teammates Jordan Henderson, James Milner and Fabinho were also there.

Van Dijk carried a red wreath with Jota’s number 20, while Robertson had a wreath featuring number 30, Silva’s number at Penafiel.

Some of Jota’s teammates in the Portuguese national side also attended, including Bruno Fernandes, of Manchester United, Ruben Dias and Bernardo Silva, of Manchester City, Joao Felix and Renato Veiga, of Chelsea, Nelson Semedo, from Wolves, Joao Moutinho and Rui Patricio.

Ruben Neves was one of the pallbearers after flying in from Florida where he played for Al Hilal in the Club World Cup quarter-final on Friday night.

‘More than a friend’

In a post published on Instagram before the service, he told Jota he had been “more than a friend, we’re family, and we won’t stop being that way just because you’ve decided to sign a contract a little further away from us!”

Jota’s fellow Liverpool midfielder, Alexis Mac Allister, said on Instagram: “I can’t believe it. I’ll always remember your smiles, your anger, your intelligence, your camaraderie, and everything that made you a person. It hurts so much; we’ll miss you. Rest in peace, dear Diogo.”

Porto FC president Andre Villas-Boas and Portugal national team manager Roberto Martinez were also in attendance.

‘With us forever’

Speaking after the ceremony, Martinez said the period since their deaths had been “really, really sad days, as you can imagine, but today we showed we are a large, close family.

“Their spirit will be with us forever.”

The service was private, but the words spoken by the Bishop of Porto, Manuel Linda, were broadcast to those standing outside the church.

He told Jota’s children, who were not at the service, that he was praying for them specifically, as well as their mother and grandparents.

“There are no words, but there are feelings,” he said, adding: “We also suffer a lot and we are with you emotionally.”

The brothers died after a Lamborghini they were travelling in burst into flames following a suspected tyre blowout in the early hours of Thursday morning.

No other vehicles are said to have been involved in the incident.

Liverpool have delayed the return of their players for pre-season following Jota’s death and players past and present paid tribute to him and his brother on social media.

Flowers have been left outside Anfield, where flags have been lowered to half-mast and all club shops, museums and tours have been closed until Monday.

UK

Rachel Reeves hints at tax rises in autumn budget after welfare bill U-turn

Published

8 hours ago

July 5, 2025

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Rachel Reeves hints at tax rises in autumn budget after welfare bill U-turn

Rachel Reeves has hinted that taxes are likely to be raised this autumn after a major U-turn on the government’s controversial welfare bill.

Sir Keir Starmer’s Universal Credit and Personal Independent Payment Bill passed through the House of Commons on Tuesday after multiple concessions and threats of a major rebellion.

MPs ended up voting for only one part of the plan: a cut to universal credit (UC) sickness benefits for new claimants from £97 a week to £50 from 2026/7.

Initially aimed at saving £5.5bn, it now leaves the government with an estimated £5.5bn black hole – close to breaching Ms Reeves’s fiscal rules set out last year.

In an interview with The Guardian, the chancellor did not rule out tax rises later in the year, saying there were “costs” to watering down the welfare bill.

“I’m not going to [rule out tax rises], because it would be irresponsible for a chancellor to do that,” Ms Reeves told the outlet.

“We took the decisions last year to draw a line under unfunded commitments and economic mismanagement.

“So we’ll never have to do something like that again. But there are costs to what happened.”

Meanwhile, The Times reported that, ahead of the Commons vote on the welfare bill, Ms Reeves told cabinet ministers the decision to offer concessions would mean taxes would have to be raised.

The outlet reported that the chancellor said the tax rises would be smaller than those announced in the 2024 budget, but that she is expected to have to raise tens of billions more.

It comes after Ms Reeves said she was “totally” up to continuing as chancellor after appearing tearful at Prime Minister’s Questions.

Criticising Sir Keir for the U-turns on benefit reform during PMQs, Conservative leader Kemi Badenoch said the chancellor looked “absolutely miserable”, and questioned whether she would remain in post until the next election.

Sir Keir did not explicitly say that she would, and Ms Badenoch interjected to say: “How awful for the chancellor that he couldn’t confirm that she would stay in place.”

In her first comments after the incident, Ms Reeves said she was having a “tough day” before adding: “People saw I was upset, but that was yesterday.

“Today’s a new day and I’m just cracking on with the job.”

Sir Keir also told Sky News’ political editor Beth Rigby on Thursday that he “didn’t appreciate” that Ms Reeves was crying in the Commons.

“In PMQs, it is bang, bang, bang,” he said. “That’s what it was yesterday.

“And therefore, I was probably the last to appreciate anything else going on in the chamber, and that’s just a straightforward human explanation, common sense explanation.”

UK

Diogo Jota and Andre Silva’s funeral in pictures

Published

9 hours ago

July 5, 2025

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Diogo Jota and Andre Silva's funeral in pictures

The family and friends of Diogo Jota and his brother Andre Silva have been joined by Liverpool stars past and present and other Portuguese players at the pair’s funeral near Porto.

The Liverpool forward, 28, and his brother died in a car crash in Spain on Thursday.

Pictures below show the funeral at the Igreja Matriz de Gondomar church in the town of Gondomar near Porto. Click here for our liveblog coverage of the day’s events.