Following the UK Chancellor Jeremy Hunt’s announcements of more funding for defence and childcare as part of the 2023 Spring Budget;

Robert Stoneman, Service Director at GlobalData, a leading data and analytics company, offers his view:

“Like the 2022 Autumn Statement, this again lays bare the stark divisions in public spending priorities driven by the major challenges facing the nation today. The headline figure is an extra £11 billion over five years for the Ministry of Defence (MoD), with a long-term aim (but no firm date) to have defence spending account for 2.5% of GDP, driven by the ongoing War in Ukraine.

“The other headline figure is £18.4 billion over five years for a range of measures to alleviate the high cost of childcare. However, there is no additional money for schools and a refusal to budge on pay increases, meaning any that are agreed will likely come from existing budgets.

“For everyone else, there are limited changes to resource departmental expenditure limits (DEL) as laid out at the 2021 Spending Review. For Capital DEL (money spent on key programmes) there is around £3.5 billion less for financial year 2022-23 and the following two years for what used to be the BEIS remit (including the three new/renamed departments). Health and Social Care Capital DEL is also down by £500 million net over this financial year and 2023-24, and DLUHC down by £1.7bn.”

Rob Anderson, Research Director for Central Government, offers his view:

“This was a fairly quiet budget when it comes to digital and technology priorities. Much of the detail is not to be found not in the ‘red book’, but in Sir Patrick Vallance’s ‘Pro-Innovation Regulation of Technologies Review’ and the Government’s response. The Chancellor claimed the government would implement all Vallance’s recommendations, though some of the responses are light on detail, with few new commitments.

“The only other major announcement was £900 million to build an exascale supercomputer and to establish a new AI Research Resource, starting in 2024.”

Stoneman concludes: “The UK public sector spent £20.1 billion on ICT goods, services, and staff in financial year 2021-22, though government spending priorities will continue to influence how much public sector organisations can spend on technology. The protection of healthcare funding in real terms in recent years has coincided with a period in which the health sector saw the only significant growth in ICT investment – a 9.9% compound annual growth rate in cash terms since 2016-17 – with wider spending flatlining. By comparison, ICT spending by the MoD fell by 5.8% annually since 2016-17,  so the measures outlined in the 2023 Spring Budget will likely mean a small boost to defence related ICT investment over the coming years.”