The spending review outlines significant investments which will shape bidding opportunities and the project pipeline over the coming years.
How can the spending review help plan bidding activity?
The last 12 months have been challenging for the industry owing to uncertainty in the market, but the spending review signals a robust pipeline of projects, with bidding opportunities across transport, energy, and defence infrastructure.
With over £15 billion directed to local transport projects, this funding can help local authorities to invest in growth initiatives, renewable energy production, and upgrades to transport networks including zero emission buses, trams and local rail.
In the next year, bidding activity is likely to focus on major rail projects, transport renewals and energy infrastructure development. Transport is critical to the delivery of the growth mission and the government will increase transport capital investment to give people across the country greater access to jobs, education, training and public services.
The government will publish its 10 Year Infrastructure Strategy later in June. This will set out a long-term plan for how infrastructure projects are planned and delivered.
What are the key spending review highlights?
Here are some key highlights of the spending reviewing, showing what we can expect for the upcoming infrastructure pipeline.
- Light rail: £2 billion of funding between 2026/27 and 2029/30 for Transport for London’s (TfL) capital renewals programme. The government also recognises the potential growth and housing benefits of the Docklands Light Railway (DLR) Thamesmead extension and is committed to working with TfL to explore options for delivery.
- Nuclear: £14.2 billion has been confirmed for Sizewell C, with expectations this will create 10,000 jobs and over £2.5 billion has been dedicated to enable one of Europe’s first small modular reactor programmes. There will also be over £2.5 billion for nuclear fusion, including support for the UK’s world-leading programme to design and build a prototype energy plant in Nottinghamshire.
- Carbon capture, usage and storage: £9.4 billion is allocated over the spending review period to enable two new carbon clusters, in Aberdeenshire and Humberside which will boost the UK’s renewable energy capability.
Through this spending review, the government will fund key, growth-driving major projects to improve connectivity between cities and towns, including:
- the Transpennine Route Upgrade, for which the government will provide £3.5 billion; this will reduce the journey time for commuters travelling between Manchester and Leeds by a quarter; and then £240 million is to invested to enhance Leeds station, improving capacity and relieving congestion
- East West Rail, with £2.5 billion to progress its delivery, supporting housing developments and unlocking the potential of the Oxford to Cambridge Growth Corridor
- over £300 million of funding for the Welsh rail sector for new and proposed projects, including the Burns Review stations, North Wales Level Crossing, Padeswood Sidings and Cardiff West Junction
- the next stage of Midlands Rail Hub West, strengthening connections from Birmingham across the West Midlands and to other regions
- improvements to bus services, with £750m million per year to support franchising pilots in York, North Yorkshire, Chester and Cheshire West
- transport decarbonisation will also be a focus, with £2.6 million earmarked to support the shift to cleaner, more integrated mobility systems.