Spring Statement: UK pledges £13bn to boost infrastructure projects

The budget includes £13 billion in additional investment in capital infrastructure over the next five years and a £3.25 billion Transformation Fund aimed at driving efficiencies across government through AI.

The Chancellor, Rachel Reeves, said the budget would help bring about “new era of security and national renewal”.

Designed to add to the £100 billion uplift announced in last year’s Autumn Budget, the additional cash will be used to “catalyse private investment, boost growth and drive forward the UK’s modern industrial strategy”.

Chief among the projects set to benefit include the proposed Oxford-Cambridge Growth Corridor, which would link up to the two university cities to create “Europe’s Silicon Valley,” a move Reeves claims will add up to £78 billion to the UK economy by 2035.

Lee Myall, CEO of Neos Networks told Capacity that the proposed corridor was a positive proposal but the region “must be supported by resilient, high-capacity connectivity”.

“Fixed networks are the backbone of a thriving digital economy, ensuring businesses and research institutions across the corridor can collaborate, scale, and compete on a global stage,” Myall said. “This region has not seen significant new core network infrastructure deployed in some time, and there’s a clear need for next-generation networks that connect the dots and provide the necessary capacity to meet future demands.

“To realise the ambition for the Oxford-Cambridge Arc there will need to be new network infrastructure projects to support this growth, connecting the UK’s new digital hubs,” Myall added.

“The government needs to recognise the criticality of robust and scalable connectivity in shaping the UK’s digital future and make every effort to foster competition and speed up deployment.”

The Chancellor has added a sizable fund aimed at improving efficiencies across government, with the Labour Party routinely claiming it wants to cut bureaucratic red tape.

This proposed fund would be used to invest in digital technologies and AI to improve public services, including £42 million for three “Frontier AI Exemplars,” who will be tasked with test and deploy AI applications to make government operations more efficient.

The budget also includes a cash pledge to support upskilling, including boosting new construction roles which will ultimately support digital infrastructure efforts like new fibre deployments and data centre construction.

A potentially worrying omission from the Spring Statement was the lack of mention for the £500 million Project Gigabit that was promised last November.

Alan Stephenson-Brown, CEO of managed network solutions firm Evolve, told Capacity that the omission makes the pressure to deliver scalable connectivity “even higher now”.

“As digital transformation continues across industries, securing high-performance networks has become essential,” Stephenson-Brown said. “It’s clear to us that sustained investment in connectivity infrastructure is crucial for driving productivity and supporting growth in our increasingly digital economy, and would have liked to see this recognised in the Spring statement.”

There were some tax reforms, like extending Making Tax Digital (MTD) reforms to sole traders and landlords with income over £20,000 from April 2028.

But beyond that, the potential alteration or elimination of the Digital Services Tax — a Conservative era levy on UK revenues on some of the world’s biggest tech firms, was a notable absentee.

Government ministers have hinted at potentially dropping the tax to appease the Trump administration with regard to tariffs, with the technology secretary, Peter Kyle, saying earlier this week: “nothing was off the table.”

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