Heather Jameson 11 June 2025

Spending Review: Reeves pledges to put sector on 'sustainable footing'

Spending Review: Reeves pledges to put sector on sustainable footing image

Health, defence and schools were the big winners in the spending review, but the government claimed it would put local government back on ‘a sustainable footing'.

Treasury documents revealed there will be an additional £3.4bn of grand funding to the sector in 2028-29 compared to 2024-25, a real terms increase in core spending of 3.1% across the spending review period.

While plans to update the local government funding mechanisms are yet to materialise, the Spending Review reiterate Government commitments to multi-year settlements, to simplify the funding, target cash to places ‘that need it most' and allocate money ‘in a way that empower local leaders to deliver against local priorities'.

But deputy prime minister Angela Rayner secured extra funding for housing as the Government's ambition to build a further 1.5 million homes looked increasingly unlikely.

Chancellor Rachel Reeves described the move as ‘the biggest cash injection into social and affordable housing in the past decade.'

Alongside cash for the NHS, Reeves vowed to improve pay for social care workers

She pledged to ‘end the costly use of asylum hotels', with £200m funding to transform the asylum system and clear the backlog, reducing costs by £1bn a year by 2038-29, ending the previous government's policy of ‘shunting the cost of failure on local communities'.

There was funding for 350 of the country's most deprived communities, including money for parks libraries and to clean up graffiti in a fund similar to the Conservative's levelling up funding.

And the Chancellor pledged to boost jobs and economic growth, using defence and green energy investments to improve areas across the country. She claimed the UK would become a ‘defence industrial superpower'.

There were also plans for £1.2bn a year to boost skills and jobs for young people.

An expected review of Special Educational Needs and Disabilities failed to materialise in the Chancellors speech, but Spending Review documents revealed it will be in the schools bill expected in the Autumn.

A 10-year infrastructure strategy and industrial strategy will also follow later, but the expected review of the Treasury Green Book has been published in an effort to ‘make sure no region has treasury guidance wielded against them', the Chancellor said.

There was a raft of spending on transport, including plans to take forward Northern Powerhouse Rail, expand east-west rail, linking up the Oxford Cambridge arc, and improving the Midlands rail hub.

Citing the Cabinet Office's moves towards public service reform, Reeves vowed to ‘relentlessly' cut waste ‘with every single penny reinvested in public services.'

SIGN UP
For your free daily news bulletin
Highways jobs

Corporate Director Community Development

North Yorkshire Council
£145,894 to £169,693 plus relocation support
North Yorkshire Council is entering an exciting new phase of transformation, growth and opportunity. Northallerton, North Yorkshire
Recuriter: North Yorkshire Council

Functional Family Therapy Practitioner

Cheshire East Council
£43,149 - £49,658
Do you want to be part of an innovative service that delivers evidence-based interventions and helps families thrive? Macclesfield, Cheshire
Recuriter: Cheshire East Council

Director of Adult Social Care

Nottingham City Council
£101,636 - £112,285 per annum (SLMG1)
As a key member of the Directorate Leadership Team, you will provide visible and effective leadership Nottinghamshire
Recuriter: Nottingham City Council

Director of Adults Service Development

Nottingham City Council
£101,636 - £112,285 per annum (SLMG 1)
This is a strategic improvement and assurance leadership role focused on driving the Adults Social Care improvement journey Nottingham, Nottinghamshire
Recuriter: Nottingham City Council

Adult Social Care and Commissioning Director Roles

Nottingham City Council
£101,636 - £112,285 per annum (SLMG 1)
This is an exciting time to join Nottingham City Council and help shape the future of Adult Social Care for the city.  Nottingham, Nottinghamshire
Recuriter: Nottingham City Council
Linkedin Banner