Initial response to Budget 2026 and the defence investment plan

“The Chancellor is clearly pro innovation and recognises the value it brings to the UK. Alongside the commitment to support innovative businesses and entrepreneurs, no major announcement of changes to the structure of R&D spending is a positive to be taken from today’s budget. CaSE and the sector have long been calling for stability and predictability. Given the machinery of government changes and the funding restructure at UKRI currently in the works, it is welcome that this budget brings stability and no additional large changes. However, as always, we will need to scrutinise the accompanying documents before making our final assessment.

“There are other developments on the horizon that we also need to keep a watching brief on. The devolution of R&D funding and reprioritisation across Government to fund defence could have significant impact on the research landscape. CaSE will analyse the detail of all of these as they become available, which we expect to be in the near future.”

“We recognise the importance of funding defence and appreciate that the Government is choosing to spread the cost of cuts across all departments. However, we are concerned that with departments having to make savings in their capital expenditure budgets, R&D may end up being disproportionately targeted.

“Departments are being asked to focus ‘on finding efficiencies, cancelling or delaying lower priority programmes and remaining ruthlessly focussed on value for money for the taxpayer’. Whilst each department’s capital budget has a different make up, there is a risk research budgets across the board are seen as more expendable when put up against major infrastructure and other procurement costs. It is essential further guidance is given to departments and oversight provided to ensure that R&D doesn’t become a sacrificial lamb.”