On 11 June 2025, Chancellor Rachel Reeves delivered the UK Government’s long-awaited Spending Review. Positioned as a roadmap for economic renewal, the Review sends a strong signal: the UK is backing innovation as a national growth engine.
Here, we break down what this means for researchers, founders, public-private partnerships, and the broader innovation funding landscape.
If you want to skip to a short summary of prioritised sectors and technologies for R&D grant funding in the UK – click here for our blog on that.
£86 Billion Commitment to R&D
The headline figure is bold: £86 billion over four years, with annual research and development (R&D) spending set to rise to £22.6 billion by 2029–30. That’s an above-inflation increase and a strong reaffirmation of the UK’s ambition to become a science and tech superpower.
The funding boost will support:
- Core investments via UK Research and Innovation (UKRI)
- The UK’s continued participation in Horizon Europe
- A new wave of mission-led innovation initiatives
Mission-Focused Innovation Programmes
The UK government is introducing a £500 million R&D Missions Accelerator Programme, aimed at aligning research with strategic goals—climate, health, security, and productivity. This programme is expected to unlock an additional £1.5 billion in private co-investment.
In parallel, the Advanced Research and Invention Agency (ARIA) will receive at least £1 billion, supporting high-risk, high-reward research outside traditional funding pathways.
Investing in AI, Supercomputing and Digital Infrastructure
Some of the most forward-looking investments include:
- £750 million for a new national supercomputer at the University of Edinburgh.
- £2 billion between 2026 and 2030 to supercharge AI compute capacity and create a UK Sovereign AI Unit.
- A new AI Adoption Fund to scale practical use across health, manufacturing, and public services.
- Fellowships and scholarships to build AI and quantum skills across the UK talent pipeline.
Local Innovation Partnerships
A standout addition is the £410 million Local Innovation Partnerships Fund, which gives regional leaders a voice in shaping R&D investment. This marks a shift from centralised innovation policy to a place-based approach.
From microchip development in South Wales to life sciences in Liverpool, local ecosystems will now be supported to drive innovation aligned with regional strengths.
Sector-Specific R&D: Clean Tech, Health, and Defence
The review includes substantial support for sectoral R&D:
- £9.4 billion for Carbon Capture, Usage and Storage (CCUS)
- £2.5 billion+ each for Small Modular Reactors (SMRs) and nuclear fusion
- £600 million for a new Health Data Research Service, co-funded with the Wellcome Trust
- £520 million for life sciences manufacturing
- Over £4 billion for autonomous defence systems, including drones and AI-enabled weapons platforms
These initiatives reflect a strategic convergence of innovation and resilience—advancing clean growth, public health, and national security.
Departmental Investment Breakdown
According to the UK Treasury’s departmental figures, R&D investment will be driven by:
- DSIT (Science, Innovation & Technology): £15.2bn by 2029–30
- Ministry of Defence: £2.4bn
- Department of Health: £2.0bn
- Department for Energy: £0.8bn
- Business and Others: £2.2bn combined
What This Means for Innovators
The 2025 Spending Review doesn’t just allocate funds—it sets direction. We now see:
- A bolder role for government in setting R&D missions.
- A growing emphasis on regional innovation leadership.
- A stronger pull for private sector co-investment.
For innovators, this presents new opportunities to align with national missions, access regional funding pathways, and engage with evolving funding instruments—especially in AI, clean tech, defence tech, and life sciences.
How Venturenomix Can Help
At Venturenomix, we specialise in helping visionary companies secure public funding to scale deep tech, R&D-intensive innovations. With a deep understanding of the UK and EU funding landscape and experience across sectors, our team is ready to help you unlock opportunities arising from this Spending Review.
Want to discuss how your innovation fits with the UK’s new funding priorities? Get in touch with us today.
Alex Chalkley
I have over 20 years experience in founding and scaling businesses, mainly focused on the non-dilutive funding sector. Since 2008, I have built, trained and mentored teams to successfully draw down over €100m in non-dilutive funding from the UK and EU for clients spanning multiple sectors.
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