She unveiled plans to allocate £39 billion over the next decade—an average of £3.9 billion per year—to support the development of new social housing. The funding will be distributed among local councils, housing associations, and private developers. This marks a notable rise from the current £2.5 billion yearly budget set under the 2021–26 programme.
Reeves also confirmed that social housing landlords will be permitted to increase rents above the rate of inflation over the next ten years, a move she argues is necessary to support investment and expansion in the sector.
The Chancellor Reeves told MPs social housing had been: “neglected for too long – but not by this Labour government … A new Affordable Homes Programme – in which I am investing £39bn over the next decade. Direct government funding that will support housebuilding especially for social rent, and I am pleased to report that towns and cities including Blackpool, Preston, Sheffield, and Swindon already have plans to bring forward bids to build new houses.”
As part of the reforms, social landlords will be permitted to increase rents by 1% above the consumer price index annually for ten years—extending the original five-year framework announced by Reeves in 2024.
The government is also consulting on reintroducing rent convergence, a policy scrapped in 2015, which would allow lower social rents to rise faster to bring them in line with comparable properties.
Additional measures outlined in Reeves’ statement include:
NHS there will be a £29 billion annual uplift in NHS day-to-day spending which is a 3% year-on-year increase until the next election—and £2 billion earmarked for artificial intelligence, feeding into a broader expansion of the R&D budget to £22 billion.;
AI Plus £2 billion spending on this as part of growth of research and development budget to £22 billion;
Another £2 billion to fund 13,000 extra police officers, PCSOs and special constables; £7 billion on 14,000 new prison places;
Winter fuel: The government has partially reversed cuts to winter fuel payments, at a cost of £1.2 billion. Over three-quarters of pensioners will now get the payment;
Defence An extra £11 billion of spending, going from 2.3% of GDP to 2.6% by April 2027, paid in part by cutting overseas aid. A pledge to increase defence spending to 3%, but without a hard date;
Housing asylum seekers in hotels will stop by the end of this Parliament in 2029; another £280m for enhanced border controls;
Education: Core schools budget will receive an extra £4.5 billion a year, of which half will be spent on “crumbling classrooms”, along with free school meals expanded to 500,000 children whose parents get Universal Credit, regardless of income;
Energy: The government will invest £14.2 billion in nuclear energy, supporting the construction of the Sizewell C power station and several smaller modular reactors.
Transport: A £15.6 billion investment package will fund upgrades to public transport in Greater Manchester, the Midlands, Tyne-and-Wear, and along the Oxford-Cambridge corridor.
Public Transport Fares: Bus fares outside London will remain capped at £3 until at least spring 2027.
Science: £86 billion will be channelled into scientific research, focusing on medical treatments and the development of sustainable, longer-lasting battery technology.
The Chancellor says: “My driving purpose since I became Chancellor is to make working people, in all parts of our country, better off. So at the Budget last October and again in the spring, I made the choices necessary to fix the foundations of our economy.”
She says total department budgets will grow 2.3% in real terms and claims she is able to “allocate £190 billion more to the day-to-day running of our public services over the course of the spending review… compared to the previous government’s plans”.