Blog by Simon Eardley (Head of Policy and Innovation – Mersey Maritime):
All eyes were on the Chancellor of the Exchequer last week as she announced the much anticipated outcome of the 2025 Spending Review (SR). The government sets out its spending plans every few years at Spending Reviews, the last one being in 2021. These reviews cover all the spending that can reasonably be planned in advance, making up about 40% of all public spending (the remaining spending is largely driven by demand that can’t be easily planned). It is fair to say this has been one of the most eagerly awaited statements, coming as it does against the backdrop of an ongoing challenging economic outlook, tight financial resources available to the Government (with little room to play with!) and difficult growth forecasts, not to forget the incredibly volatile international scene at present.
Some key headlines, which weren’t specific to the maritime industry, but could have a positive impact, included:
– Record R&D funding announced with spending in this area rising from £20.4bn in 2025-26 to £22.6bn by 2029-30
– £500m for an R&D Missions Accelerator to help attract £1.5bn private funding
– A dedicated £2bn AI Action Plan fully funded from 2026-27 to 2029-30, to be overseen by the Department for Science, Innovation and Technology
– The UK Defence Innovation fund given £400m/year from 2025-26, plus 10% of Ministry of Defence equipment procurement reserved for innovative tech
– Investment of £300 million in ‘Great British Energy’ support over the SR for Offshore Wind supply chains
– The allocation of £9.4 billion to Carbon Capture, Usage and Storage (CCUS) over the SR period.
From a government departmental perspective, the maritime industry touches several, including the most obvious, the Department for Transport (DfT), but also Defence, Science, Innovation & Technology, Business & Trade (DBT) and Energy Security & Net Zero. Each department received confirmation of their day-to-day spending totals, and it was a mixed picture. Whilst the departments for Science, Innovation and Technology, Energy Security & Net Zero and Defence will each see their overall budgets grow between now and 2028/29, the settlement for the DfT and DBT will see an average annual real terms growth of -5% and -1.8% respectively. Could this spell bad news for the maritime industry specifically in terms of what future support might be available? This seems unlikely to me.
Last year, the Department for Transport announced an extension of the successful UK SHORE funded competitions focused around delivering clean maritime in the industry. Building on the initial £206 million from the previous government, the Clean Maritime
Demonstration Competition Round 6 saw an extra £30 million available for innovative Smart Shipping technologies and skills for maritime decarbonisation. The competition winners are expected to be announced soon, possibly later this autumn. This was a strong indicator for maritime, in my view, that this area of focus would continue to be a priority for the new government. Indeed, it needs to be! We all know that if maritime decarbonisation doesn’t happen, then wider objectives in respect of net zero and delivering a cleaner, greener economy, simply won’t be possible.
And whilst the specific funding lines in the Spending Review weren’t explicit for maritime, there are also major announcements on the horizon which could herald good news and a number of other significant and high-profile events which might be a convenient opportunity for government ministers to take to the stage and offer further support to the industry.
The Government is expected to launch its Industrial Strategy by the end of June – possibly as soon as the end of next week we are given to understand. This strategy is expected to focus on addressing how the UK positions itself to respond fully and competitively to three main opportunities: the net zero transition, the advent of artificial intelligence, digitalisation and increased automation and the changing patterns of demand and demographics. Maritime could sit in some way within a number of the eight identified key growth-driving sectors: advanced manufacturing, clean energy industries, creative industries, defence, digital and technologies, financial services, life sciences, and professional and business services. The strategy aims to unlock the potential of UK cities and regions, attract investment, and create a thriving business environment. It will also address issues like skills development, data access, R&D, and infrastructure to support these sectors.
And finally, there’s the opportunity that London International Shipping Week 2025 (LISW) will also present. LISW takes place between the 15th and 19th September and is one of the most important global shipping and maritime events in the world. London, and with a few events also taking place further afield, will play host to thousands of international industry decision-makers who will attend the hundreds of official events during the week. This major showcase and stage might well offer a platform for some interesting announcements from ministers.
We mustn’t forget either a very welcome policy announcement earlier in June around a new vision for UK ports which aims to propel prosperity in Britain’s coastal communities. The announcement on the 04June aims to better support ports to deliver important national infrastructure more quickly, helping to boost local economies and jobs. The proposals aim to streamline the planning process for ports in England and expedite planning applications by more clearly outlining the existing needs for port facilities and how to design applications to meet the latest requirements to avoid process delays. This approach has long been an ambition for the industry; a welcome step in the right direction. Find out more here: https://www.gov.uk/government/news/new-vision-for-uk-ports-will-propel-prosperity-in-britains-coastal-communities
As ever, the Mersey Maritime team will be on hand to offer insights and sign-posting to all the latest news and updates around these important themes. Watch our usual channels of further information in the weeks and months ahead.
