Reeves Pledges Boost to Health, Housing, and Defence in Multi-Year Spending Review

Chancellor Rachel Reeves has delivered her first multi-year
In her
However, critics
At the core of the government's plans to 'renew Britain' is a £29 billion annual increase in NHS funding.
Other pledges include £39 billion for social and affordable housing over the next decade and confirmation of a previously announced £30 billion for nuclear projects, including £14.2 billion for the
Some departments—like Environment, Food, and Rural Affairs and Culture, Media, and Sport—are facing day-to-day spending cuts. The Department of Energy Security and Net Zero is set to see its budget grow by a much smaller average of just 0.5 percent per year from 2025/26 to 2028/29.
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Public transport projects in England's city regions will see an investment of £15 billion, while defence spending will rise to 2.6 percent by April 2027, including for the intelligence agencies.
The government has also committed £2 billion to support the growth of 'home-grown AI' and an additional £4.5 billion annually to the education budget.
To address severe
Business leaders welcomed the £25.6 billion increase in resources to the British Business Bank, which Reeves said will back 'Britain's entrepreneurs and wealth creators.'
The British Retail Consortium applauded the announcement of an extra £2 billion for policing, amid growing concerns over shoplifting.
However, the Federation of Small Businesses (FSB) criticised the review for lacking focus on smaller enterprises.
The FSB Policy Chair Tina McKenzie said that while 'small firms were not the focus today,' the government must prioritise growth reforms in the sector over the summer and through to the autumn.
Reeves also announced plans to end the use of asylum hotels during this Parliament, which is projected to save £1 billion per year. An additional £280 million annually by the end of the review period will be directed towards preventing illegal immigrant crossings.
Across the review period—lasting until 2028–29 for day-to-day spending and 2029–30 for capital investment—total departmental budgets would grow 2.3 percent a year in real terms.
A Summer of Speculation
Reeves said the budget boosts were 'only possible' because of her decision to raise taxes in the previous Autumn Budget, reaffirming that her fiscal rules are 'non-negotiable.'
She criticised the previous government for creating a '£22 billion black hole in the public finances' and vowed to bring stability to the economy.
However, Reeves currently has very limited
Given this tight buffer and the increases in spending announced since the Spring Statement, economists
The Institute of Economic Affairs (IEA) argued that Reeves's plans failed to address the so-called 'fiscal black hole.'
'So we should brace ourselves for tax increases in the autumn, and a summer of speculation over exactly where they will fall,' the IEA said.
The Conservatives described the chancellor's plan as 'not worth the paper that it is written on.'
Shadow chancellor Mel Stride said Reeves has 'completely lost control,' suggesting that tax hikes in the autumn are inevitable.
'This is the spend now, tax later review, because [the chancellor] knows she will need to come back here in the autumn with yet more taxes and a cruel summer of speculation awaits,' he told the Commons.
Economic Uncertainty
Economists cautioned that the government may not generate the necessary tax revenue to fund its commitments under Reeves's fiscal rules without broader reforms and cuts to bureaucracy.
Maxwell Marlow, director of public affairs at the Adam Smith Institute, said: 'As the state continues to balloon in size, the government must remain vigilant in ensuring taxpayer money is spent wisely. Without reform, many of its plans risk becoming unsustainable.'
Targeted investments—particularly in transport and housing outside London and the southeast—could boost Labour's political standing in areas where the party faces growing pressure from Reform UK. However, economists are uncertain whether the increased investment will generate enough growth and revenue to justify the outlay.
'The focus must now shift to delivery and avoiding the all-too-common project over-runs,' said IFS Director Paul Johnson.

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In May, the head of the national juvenile police said in a TV interview that almost 50 other children had reported to authorities that Russians had tried to recruit them. Since Russia's full-scale invasion of Ukraine in February 2022, both sides have engaged in clandestine warfare. Ukraine has recruited people in Russia for targeted high-level killings, law enforcement sources said. For instance, the Ukrainians claimed responsibility for assassinating a top Russian general and his aide with a bomb planted in a scooter in December. But with the recruitment of young Ukrainians, the Russians are taking a new step by aiming for more indiscriminate attacks, near military recruitment centers or railway stations, said Roksolana Yavorska-Isaienko, an SBU spokesperson for the Lviv region. It is reminiscent of how teenagers were used as suicide bombers in Afghanistan, Pakistan and elsewhere. Advertisement In December, the news in Ukraine was filled with reports of a significant case. The SBU and the national police detained two groups of teenagers in the eastern city of Kharkiv who they said had been tricked online into joining a fake 'quest' game, in which the 15- and 16-year-olds were sent tasks like setting fires and taking photographs and videos of certain targets, even air defenses. Ukrainian authorities said the Russians used the information to carry out airstrikes in Kharkiv, the country's second-largest city. These claims could not be independently verified. During the class, the camouflaged agent and Yavorska-Isaienko went through other examples, one by one. In March, in the case that resonated the most with the students, a 15-year-old and a 17-year-old were recruited on Telegram in the western city of Ivano-Frankivsk with the promise of $1,700, Ukrainian authorities said. Following instructions, the teenagers built two bombs out of thermos flasks and metal nuts. When they tried to deliver one of the bombs, authorities said, Russian agents detonated it remotely near the train station. The 17-year-old was killed, and the 15-year-old lost his legs. In April, the SBU caught a 17-year-old and an 18-year-old who burned train relay boxes in Lviv. They were recruited on Telegram, authorities said. Searches of their cellphones showed text messages between the teenagers and their Russian handlers. 'Yeah, the money will be there tomorrow,' the handler wrote, adding that it would arrive around lunchtime. 'Got it, bro,' one of the teenagers responded. Eventually, about $178 was transferred to his account. And in May -- just three days before the class -- two teenagers in the western city of Rivne made an explosive device from Russian instructions, put it in an abandoned building, positioned an ax there and covered the whole contraption with paint, authorities said. Then they called emergency services, claiming there was a dead person. After the police responded, the bomb exploded, but no one was harmed. The teenagers were arrested. Advertisement The recent class was about the 200th that the agency has done in the Lviv region since the outreach program started in April. The presenters knew how to hold the teenagers' attention. 'Maybe not all of these special operations are reported in the media -- but believe me, the enemy is not sleeping,' Yavorska-Isaienko said. 'They are working actively and carrying out illegal activities, as strange as it may sound, directly inside your phones.' She added, 'And when you hear an offer to earn quick money for a brand-new iPhone or $1,000, of course, it sounds very tempting. Sometimes, the task is disguised as a simple courier delivery, taking pictures of critical infrastructure or spraying provocative graffiti. That is often the first step toward your recruitment.' 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Yavorska-Isaienko and the camouflaged man told the students they could anonymously report any recruitment attempts to a new chatbot called 'Expose the FSB Agent.' And Yavorska-Isaienko told the students to use their common sense. 'No one in real life will suddenly offer you $1,000 or $2,000 just like that,' she said. 'You need to understand: The only free cheese is in the mousetrap.' This article originally appeared in