Spending Review 2025: Departmental winners and losers revealed

The government’s 2025 Spending Review sets the fiscal direction for Whitehall up to 2028–29, prioritising frontline services, defence, and clean energy, while demanding efficiency from other corners of government.

More money for the NHS, defence, energy, and digital reform, but a renewed emphasis on efficiency, productivity, and “zero-based budgeting” across much of Whitehall.

Departments not explicitly tied to public service delivery or national security are expected to do more with less. The Office for Value for Money will continue to track progress on savings, totalling £14bn annually by 2028–29.

Here's how the numbers stack up.

Winners: Who’s Getting More to Spend

1. Department for Energy Security and Net Zero (DESNZ): +16%

In line with the government’s ambition to become a “clean energy superpower,” DESNZ is the big winner. Investments include backing nuclear projects (like Sizewell C), carbon capture, and offshore wind supply chains.

2. Department for Business and Trade (DBT): +5.8%

Reflecting a more active industrial strategy and renewed focus on international trade agreements, DBT sees a meaningful boost after years of modest settlements.

3. Ministry of Defence (MoD): +3.6%

Following the Strategic Defence Review, funding rises to support warfighting readiness, munitions factories, and autonomous systems—anchoring the ambition to reach 2.6% of GDP on defence by 2027.

4. Ministry of Housing, Communities and Local Government (MHCLG): +3.0%

Despite earlier concerns over squeezed regeneration budgets, MHCLG secures a notable rise, buoyed by local government settlement increases and housing investments like the new £39bn Affordable Homes Programme.

5. Ministry of Justice (MoJ): +3.1%

MoJ receives additional funding for courts reform, 14,000 new prison places, and probation system transformation—responding to critical capacity pressures in the justice system.

6. Department for Health and Social Care (DHSC): +2.8%

With NHS day-to-day spending set to reach £226bn by 2028–29, the settlement supports both a backlog-clearing push and digital transformation efforts across the service.

7. Department for Science, Innovation and Technology (DSIT): +2.8%

DSIT leads government’s digital overhaul, with funding to scale AI use in services and build digital infrastructure—backed by a £1.9bn total investment.

8. Department for Work and Pensions (DWP): +2.1%

DWP’s modest uplift will support expanded childcare offers and employment support—offsetting flatlining elsewhere.

9. HMRC: +0.6%

A small but significant increase supports digitisation and staffing to close the tax gap—expected to raise £7.5bn more in revenue annually by 2029–30.

10. Department for Education (DfE): +1.5%

Uplift supports per-pupil funding, free school meals expansion, and school rebuilding—part of the “opportunity for all” mission.

Losers: Who’s Facing Real-Term Cuts

1. Department for Transport (DfT): −8.6%

The biggest loser in this review, with delays to major infrastructure projects and increased expectations for operational efficiencies.

2. Foreign, Commonwealth and Development Office (FCDO): −5%

ODA spending has been reduced to 0.3% of GNI, and despite global instability, FCDO funding is falling in real terms.

3. Home Office: −2.2%

While border security commands and asylum reform are prioritised, the department overall faces pressure to cut costs while delivering politically sensitive outcomes.

4. Cabinet Office: −2.2%

Spending centralisation and administrative reform have led to real-terms declines as part of the government’s push for back-office savings.

5. Department for Environment, Food and Rural Affairs (DEFRA): −0.7%

DEFRA sees a small reduction amid competing priorities, despite its central role in environmental regulation and rural resilience.

6. HM Treasury (HMT): −0.4%

Even the Treasury is not immune to restraint—administrative costs are being driven down across core departments.

7. Department for Culture, Media and Sport (DCMS): −0.2%

Modest cuts to DCMS suggest arts and sports will need to rely more on external and philanthropic funding going forward.