Rachel Reeves is about to make huge spending decisions - these could be the winners and losers

Sky News

2 days ago

A week today, Rachel Reeves presents the spending review; how the budget is divided between government departments between 2026 and 2029 - the bulk of this parliament.
It's a foundational moment for this government - and a key to determining the success of this administration.
So, what's going to happen?
The chancellor did boost spending significantly in her first year, and this year there was a modest rise.
However, the uplift to day-to-day spending in the years ahead is more modest - and pared back further in March's spring statement because of adverse financial conditions.
Plus, where will the £113bn of capital - project - spending go?
So, we've done a novel experiment.
We've taken Treasury documents, ministerial statements and reports from the Institute for Fiscal Studies.
We put them all into AI - into the deep research function of ChatGPT - and asked it to write the spending review, calculate the winners and losers and work out what goes where, and why.
It comes with a health warning. We're using experimental technology that is sometimes wrong, and while ChatGPT can access up-to-date data from across the web, it's only trained on information up to October 2023.
There are no answers because discussions are still going on. Think of it like a polling projection - clues about the big picture as things move underneath.
But, critically, the story it tells tallies with the narrative I'm hearing from inside government too.
The winners? Defence, health and transport, with Angela Rayner's housing department up as well.
Everywhere else is down, compared with this year's spending settlement.
The Home Office, justice, culture, and business - facing real terms squeezes from here on in.
The aid budget from the Foreign Office, slashed - the Ministry of Defence the beneficiary. You heard about that this week.
Health - a Labour priority. I heard from sources a settlement of around 3%. This AI model puts it just above.
Transport - a surprise winner. Rachel Reeves thinks this is where her capital budget should go. Projects in the north to help hold voters who live there.
But, could this spell trouble?
Education - down overall. Now this government will protect the schools budget. It will say 'per pupil' funding is up. But adult education is at risk. Is this where they find the savings?
So much else - Home Office down, but is that because asylum costs are going down.
Energy - they're haggling over solar panels versus home insulation.
Justice should get what it wants, I am told. This isn't about exact percentages. But you can see across lots of departments - things are tight.
Even though Rachel Reeves has already set the budgets for last year and this, and only needs to decide spending allocations from 2026 onwards, the graphs the Treasury will produce next week compare what will be spent to the last set of Tory plans.
This means their graphs will include the big spending increases they made last year - and flatter them more.