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Spending review live updates: Rachel Reeves to reveal how Britain will splash the cash with NHS, defence and schools in line for windfalls

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Chancellor Rachel Reeves will today unveil her spending review in Parliament.

The review, which will set out day-to-day spending plans for the next three years and capital spending plans for the next four, is expected to see boosts for the NHS, defence and schools.

But it is also likely to involve squeezes for other departments as the Chancellor seeks to keep within the fiscal rules she has set for herself.

Her room for manoeuvre has also been further constrained by the Government’s U-turn on winter fuel payments, which will see the benefit paid to pensioners receiving up to £35,000 per year at a cost of around £1.25 billion to the Treasury.

Live updates below

Reeves to argue her priorities are for ‘working people’

Reeves and Keir Starmer preparing for the Budget last year

LONDON, ENGLAND - MARCH 5: Labour Party Leader Keir Starmer (L) and Shadow Chancellor Rachel Reeves (R) prepare for the Tory Spring Budget in Parliament on March 5, 2024 in London, United Kingdom. Rachel Reeves has said it would "take time" for a Labour government to "reverse the damage" the Tories have done to the economy over the past 14 years, she has also said "working people have been left worse off" by Conservative rule since 2010. The Spring Budget will be delivered to Parliament tomorrow by the current Chancellor Jeremy Hunt and is expected to be the last before the General Election. (Photo by Belinda Jiao/Getty Images)

Rachel Reeves will tell the Commons this afternoon her priorities are ‘the priorities of working people’.

The Chancellor is expected to focus on ‘Britain’s renewal’ as she sets out her spending plans for the coming years, with big increases for the NHS, defence and schools.

Arguing that the Government is ‘renewing Britain’, she will acknowledge that ‘too many people in too many parts of the country are yet to feel it’.

This Government’s task – my task – and the purpose of this spending review is to change that, to ensure that renewal is felt in people’s everyday lives, their jobs, their communities.

Among the main announcements is expected to be a £30 billion increase in NHS funding, a rise of around 2.8% in real terms, along with an extra £4.5 billion for schools and a rise in defence spending to 2.5% of GDP.

But Wednesday could present a tough prospect for other government as the Chancellor seeks to balance Labour’s commitments on spending with her fiscal rules.

Who will be the winners and losers?

Britain's Prime Minister Keir Starmer (R) and Britain's Education Secretary Bridget Phillipson (L) speak with pupils over lunch during a visit to a primary school in Essex, eastern England, on June 5, 2025. The UK Government announced Thursday that over half a million more children are to get free school meals. (Photo by Isabel Infantes / POOL / AFP) (Photo by ISABEL INFANTES/POOL/AFP via Getty Images)

On Monday, the Government confirmed it had reached settlements with all departments after Yvette Cooper became the last Cabinet minister to fix a deal.

Some ministers will be celebrating the agreements, while others will rue not securing a more generous sum.

Let’s take a look at the potential winners and losing from the spending review:

According to reports, the NHS will be in line to receive a £30 billion cash boost at the expense of other public services with the Department for Health and Social Care set to be given the largest settlement of the spending review. But despite the incoming windfall, health chiefs have warned Labour’s promise to ‘turbocharge delivery’ could lead to difficult compromises elsewhere.

Day-to-day funding for schools is expected increase by an extra £4.5 billion by 2028-9 compared with the 2025-6 core budget, while free school meals will be expanded to 500,000 children whose parents are receiving Universal Credit, regardless of their income.

The Government has committed to spend 2.5 per cent of gross domestic product on defence from April 2027, with a goal of increasing that to 3 per cent over the next parliament – a timetable which could stretch to 2034.

Home Secretary Yvette Cooper was believed to be the last Cabinet minister to agree a deal with the Treasury amid reports she desperately tried to get more money for the police and borders funding. Police chiefs including Sir Mark Rowley, the commissioner of the Metropolitan Police, had lobbied the government for more money with suggestions the department had a settlement ‘imposed’ on it by No 11.

Mayor of London Sir Sadiq Khan’s office is concerned that Wednesday’s announcement will include no new funding or projects for London.The mayor had been looking to secure extensions to the Docklands Light Railway and Bakerloo line on the Underground, along with the power to introduce a tourist levy and a substantial increase in funding for the Metropolitan Police.

What we know will be in the spending review

Some announcements of what will be included in the spending review were made ahead of Reeves’ statement in Parliament later.

Reeves will deliver her review at 12:30pm after Prime Minister’s Questions.

Here’s what we can expect:

Payments will be made to three quarters of pensioners this year after Reeves confirmed a U-turn on the government’s controversial decision to limit the payments to those receiving means-tested benefits. The government said the change will cost around £1.25bn in England and Wales.

Will rise from 2.3% of gross domestic product (GDP) to 2.5% by 2027 – an increase of around an extra £5bn a year. This will be paid by cutting the overseas aid budget. Ministers want to increase defence spending to 3% by 2034. There are suggestions that the NHS will get an extra £30bn over three years

Will be expanded to 500,000 children whose parents are receiving Universal Credit, regardless of their income. Across education, day-to-day spending will rise by £4.5bn a year by 2028-29, according to The Observer

Investment worth £15.6bn will fund extensions to trams, trains and buses in Greater Manchester, the Midlands and Tyne-and-Wear, after criticism that too much infrastructure spending targeted London and the South East

The government will spend £86bn on the science and technology sector by the end of the parliament, including funding research into areas such as drug treatments and longer-lasting batteries

Reeves has signed off on £14.2 billion of investment to build the new Sizewell C nuclear plant which the Treasury said would go towards creating 10,000 jobs, including 1,500 apprenticeships. Energy Secretary Ed Miliband said new nuclear power capacity was needed to deliver a ‘golden age of clean energy abundance’.

Analysis: Tough choices await Reeves amid economic and political pressure

EMBARGOED TO 0001 WEDNESDAY JUNE 11File photo dated 09/06/25 of Chancellor of the Exchequer Rachel Reeves during a visit to the Castlehaven Horticulture hub in Camden, north-west London. Rachel Reeves will vow to "invest in Britain's renewal" as she reveals her spending plans for the coming years on Wednesday. Issue date: Wednesday June 11, 2025. PA Photo. The Chancellor is expected to announce big increases in spending on the NHS, defence and schools as part of a spending review set to include £113 billion of investment thanks to looser borrowing rules. See PA story POLITICS SpendingReviewReeves. Photo credit should read: James Manning/PA Wire

The generous fiscal envelope set at the Budget last Autumn has been put under massive pressure by the economic slowdown, calls for more defence cash, and Labour revolts on benefits.

While the political backdrop to the proposals this week is the continual surge of Reform, with Labour increasingly panicking about the challenge posed by Nigel Farage and co.

Ms Reeves will have some £113billion to distribute that has been freed up by looser borrowing rules on capital investment.

But she has acknowledged that she has been forced to turn down requests for funding for projects she would have wanted to back in a sign of the behind-the-scenes wrangling over her spending review.

Economists have warned the Chancellor faces unavoidably tough choices in allocating funding for the next three years.

She will need to balance manifesto commitments with more recent pledges, such as a hike in defence spending, as well as her strict fiscal rules which include a promise to match day-to-day spending with revenues.

Rachel Reeves to unveil spending review

Hello and welcome to MailOnline’s live coverage as Rachel Reeves unveils the government’s spending review.

The Chancellor is due to lay out departmental allocations running up to 2029 – the likely timetable for the next general election – later today in the Commons. Among the main announcements is expected to be a £30 billion increase in NHS funding, a rise of around 2.8% in real terms, along with an extra £4.5 billion for schools and a rise in defence spending to 2.5% of GDP.

Reeves has been busy haggling with ministers with some desperately trying to get more cash before all settlements were finally reached on Monday.

Inevitably today there will be winners and losers.

Stick with us for the latest news and analysis throughout the day with reporting from MailOnline’s political team plus expert financial insight from our This Is Money team.



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