Key Points for NFRC Members–Spending Review Construction Funding

The construction sector emerged as a clear winner at a time when difficult fiscal decisions are being made.

This article highlights the key areas of public spending that may be relevant to NFRC Members, providing insight into the Government’s current priorities.

Unlike a traditional Budget, the Spending Review focuses on where money will be allocated, not how it will be raised. It is widely anticipated that the Autumn Budget later this year will include tough choices, potentially affecting businesses, for example, through possible increases in fuel duty. While this ongoing uncertainty makes long-term planning more difficult for businesses, new investment in construction and skills should help reinforce the strength of the sector.

For NFRC Supplier Members in particular, it is worth noting the absence of targeted support for manufacturers facing high energy costs. It is hoped that the forthcoming Industrial Strategy will address this gap. Looking ahead, another major announcement to watch for is the Government’s 10-year Infrastructure Plan, expected next week.

Housing/Infrastructure:

• £39bn Affordable Homes Programme confirmed for 2026–2036, rising to £4bn annually by 2029/30, then increasing with inflation.

• 10-year rent settlement from 2026 set at CPI + 1%, with a consultation on social rent convergence to follow.

• £2.5bn in low-interest loans and £4.8bn in financial transactions (2026–2030) to support social housing development and attract private investment.

• £1bn (2026–2030) to speed up social housing remediation, giving providers access to the same funding as private owners.

• A UK-wide, permanent Mortgage Guarantee Scheme launches in July, ensuring access to 95% mortgages beyond the current scheme’s June 2025 end.

• £13.2bn over the Spending Review period into the Warm Homes Plan, funding heat pumps, energy efficiency, and low-carbon tech like solar and batteries. Delivery will be supported by public finance bodies, including the National Wealth Fund. More details due October.

• £7bn this Parliament is committed to renewing military accommodation, including £1.5bn for urgent repairs to forces family housing

• Rebuilding 500+ schools, with £2.4bn/year over the next four years (up from £1.4bn in 2025/26), and extending the programme to 2034/35 under a 10-Year Infrastructure Strategy.

• Annual maintenance funding for the school estate will rise with inflation to £2.3bn by 2029/30, up £400m from 2024/25. In 2025/26, it will be £2.1bn.

• £7bn (2024/25–2029/30) to deliver 14,000 new prison places by 2031

• DHSC capital budgets will rise by £2.3bn in real terms (a £4bn nominal increase) from 2023/24 to 2029/30 to fund NHS investment in tech, hospitals, and primary care — including 25 new hospitals under the New Hospitals Programme.

Skills:

• Confirmed £625 million between 2025/26 and 2028/29 to train up to 60,000 skilled construction workers, as announced at Spring Statement 2025

• Pledge of up to £1.2 billion per year in skills training for young people by the end of the Parliament.