UK Budget 2025: What it means for place, infrastructure and data-led delivery in 2026 and beyond

It’s January. Christmas is over. 2025 is over. It’s time to make good on the promises of last year. It’s time to get on with it.
Delivery programmes reset, planning cycles are back underway. Ambitious targets say,  “this year will be different.”, “This year will be better.” We’re all trying to make it to the gym, make it past the biscuit cupboard, make it through the month. Local authorities, infrastructure owners and public bodies regroup—if not refreshed, then at least determined—hoping to make progress despite the familiar constraints of funding battles, productivity pressure, ageing assets, all hoping that the issues of 2025 don’t follow into 2026.

And here’s the thing: sometimes change does arrive and sometimes it’s good. But often, it’s a mixed-bag. On November 26th, Rachel Reeves announced her 2025 Autumn budget. Now, two months on, we can see more clearly whether it’s the kind of change that matters, and make that change happen.

With £26 billion in tax rises and over £120 billion committed to capital infrastructure, it certainly seems that housing, transport, net-zero and public services are strategic priorities and central to growth. But with the OBR forecasting modest GDP growth and persistent productivity constraints, essentially doubling down on long-term investment while raising the bar how that investment gets delivered.  

And the answer? Well, that depends on your data. In this blog, we’ll review the budget as set out in 2025 and see what that means in the harsh light of day this new year 2026. Let’s dig in.

The Big Picture: Investment Meets Accountability

WHAT?  The government needs to balance immediate revenue needs with long-term ambition

HOW? £26 billion to be raised through various tax measures while committed £120 billion to infrastructure (with £15.6 billion earmarked specifically for major city-region transport schemes—more on this in the next section)

OBR FORECAST: GDP growth averaging 1.5% (next 5 years) | Inflation easing from 3.5% this year towards 2% (by 2027) | Productivity growth stuck at 1% | Public investment uplift to raise potential output by 0.4% (over 10 years)

SO WHAT? So, every infrastructure pound will be scrutinised even harder, that’s what. Projects will need to demonstrate productivity gains, clear outcomes and defensible evidence more than ever.

The Big Opportunity: £120 Billion for Infrastructure Delivery

So, with a £120 billion investment promised for roads, rail and energy infrastructure, yes, scrutiny will be more stringent, but the opportunity for those who can demonstrate that their projects will deliver genuine value is most definitely there.
This could mean major road and rail schemes: HS2 extensions, regional rail improvements, strategic road network upgrades. It means Grid reinforcements for renewable energy, local energy schemes. It means £15.6billion for metro systems, bus rapid transit, cycling infrastructure and integrated ticketing. That’s a lot of infrastructure.

This is where spatial data becomes critical. Where are the gaps in energy infrastructure most needing investment? Which assets are at risk? Asset management and insight will need to be paramount. High integrity data and full insight will be needed for better decision-making. It’s why organisations are increasingly turning to tools built on Ordnance Survey’s National Geographic Database (NGD) to deliver the spatial intelligence needed for evidence-based planning. The organisations that can answer these questions with evidence will be the ones that secure funding and deliver successfully.

250 New Neighbourhood Health Centres: A Spatial Planning Challenge

WHAT? A major opportunity for health trusts, local authorities and their planning partners, that’s what. 250 new Neighbourhood Health Centres across England also presents a significant spatial analysis challenge.

HOW? Because it comes with critical questions, for instance:

• Where should these centres be created to maximise accessibility for under-served populations
• How do we balance geographic coverage with population density and health needs?
• Which locations offer the best transport links and service integration with existing facilities?

SO WHAT? So, sophisticated spatial analysis layering deprivation data, health outcomes, transport accessibility, existing service provision, demographic projections… this is no mean feat!
The funding is there, but delivery will depend on evidence-led planning that can withstand (you guessed it!) scrutiny from regulators, auditors and local communities.
Auditability is exactly why tools that don’t just support analysis, but allow organisations to evidence, explain and defend their decisions with confidence are pivotal (as we’re always harping on about to our clients!)

Plus, consumers will have noted the Energy Bill Relief of around £150 from April 2026. But for organisations planning fuel poverty interventions or retrofit schemes, spatial analysis of income, housing stock and consumption patterns will play a part in understanding where that saving matters most.

Three Policy Shifts that add complexity

Alongside new investment, several policy changes are making planning and delivery more nuanced and less tolerant of broad assumptions.

From 2028, electric vehicles move from incentives to “pay by use” through a new mileage-based excise duty. For organisations managing vehicle fleets, this fundamentally alters the transition equation. High-mileage routes, rural coverage and service-critical journeys will be affected first, forcing more targeted decisions about where electrification delivers real value, and where alternative approaches may be needed in the short term.

At the same time, the fuel duty freeze continues through to late 2026. This delays some behavioural shifts away from combustion engines, complicating traffic forecasts, mode-shift assumptions and net-zero timelines. Business cases that rely on these patterns will need to distinguish between short-term policy effects and longer-term structural change.

Housing policy adds a further layer. New high-value property taxes from 2028 may influence behaviour in prime markets, affecting land values, development pipelines and cross-subsidy for affordable housing. The impacts will vary street by street, market by market and assumptions that hold in one place may fail in another.

In each case, the common theme is granularity. Geography-specific analysis, scenario testing and prioritisation based on real patterns of use, demand and impact.

This mirrors a shift already familiar to utilities managing complex, buried networks. As water companies and infrastructure operators have found through pipeline monitoring and asset location programmes, strategies move from broad coverage to precision positioning, understanding not just where infrastructure could go, but where it will deliver the most value. At MGISS, we see this repeatedly in practice. Where evidence has historically been hardest to establish, it is the quality, accessibility and confidence of asset data that makes the difference, enabling organisations to prioritise intervention, justify investment and communicate decisions.

And as for Everything Else, i.e. the OBR Forecast

GDP growth averaging 1.5% over the next five years, inflation easing from 3.5% this year towards 2% by 2027, and productivity growth stuck at around 1%.

Or is it? Recent analysis from the Resolution Foundation suggests the productivity picture may be better than official statistics indicate. Using more reliable payroll data rather than the troubled Labour Force Survey, productivity appears to have grown by 3.4% over the past six quarters in a rate not seen since before the financial crisis. This includes encouraging signs of a “zombie firm” clear-out, where low-productivity companies that contribute little to the economy are finally being replaced by more efficient operations.

If this alternative measure is right, it changes the narrative slightly: the government may not need to “unstick” the productivity dial so much as ensure the momentum continues. But whether productivity is genuinely surging or this is just productivity in “new year, new me” mode until old habits kick back in, the conclusion for infrastructure delivery remains the same.

And that conclusion is that quality of delivery is more at the forefront than ever, with scrutiny (both official and public) at an all-time high, and pressure to deliver well keeping infrastructure owners, local authorities, health trusts, housing associations and utility companies up at night.

That said, on the other side of pressure is opportunity. Yes, outcomes, efficiency and evidence are hungry beasts that must be well fed, but organisations that can demonstrate impact through proper, insight-led spatial analysis, evidence-led planning and data-driven decision making will be rewarded with funding secured, approval gained and a successful delivery. Demand forecasting, asset management, impact assessment and equity analysis will be pivotal.

Doing more with less: learning from local government

This kind of pressure is not new for local authorities. Many have been operating under it for years. Some are now showing exactly how evidence-led planning works in practice.

In Surrey County Council and Sheffield City Council, spatial intelligence is being used to prioritise maintenance, justify investment and demonstrate value under real budget constraints. The focus is not transformation for its own sake, but ensuring limited public funds are directed where they reduce risk, maintain service quality and stand up to challenge. Click the links to see how they’re making it work!

What We Know Now in January 2026: The Rules Just Got Clearer

Two months on from the budget, policy has moved fast. Here’s what’s changed the game:

Planning and Infrastructure Act (Royal Assent: 18 December) – Grid connections now work on “first ready, first connected” not “first come, first served.” In essence, projects without high integrity spatial data get deprioritised.

Energy: £40bn/year + connection queue reset – NESO paused transmission applications from 29 January to overhaul the system (new process by 31 May). Every energy project now needs hard data on siting, grid capacity, and demand to compete for connections.

Water: £104bn but higher scrutiny – Ofwat’s Price Review gives the sector significant funding through 2030, while simultaneously appointing an independent monitor for Thames Water. Asset management, infrastructure condition analysis, and demand pattern mapping are no longer optional. It’s also happens to be why MGISS continues to add new capabilities that help organisations monitor pipe networks more effectively (“Understand risk spatially!”, we keep saying. “Prioritise intervention based on evidence rather than assumption!”, we beg.)

Transport: Structures fund + digital twins – Investment in bridges, tunnels and flyovers backed by National Highways testing advanced condition assessment tech. Risk prioritisation and climate resilience analysis determine which projects get funded first.

The bottom line:

Organisations with evidence-led spatial intelligence secure funding and approvals. That’s it. That’s the bottom line.

To come to a close, no, the budget didn’t deliver any miracles, but it did clarify the rules of the game as we approach the near future of UK infrastructure and place-based delivery.
For infrastructure owners and public bodies, spatial intelligence is no longer optional. It underpins credible planning, confidence, prioritisation and accountable use of public money.
For MGISS, this simply reinforces a direction already well established: helping organisations move from fragmented data to trusted insight, from assumption to evidence, and from reactive decisions to confident delivery.
Prove your approach works, show your planning is evidence and insight-led, demonstrate you’re making the right decisions and deliver real impact and value. Join the spatially sophisticated future of the UK.

And have a prosperous 2026!

[Official Budget 2025 document: https://www.gov.uk/government/publications/budget-2025-document/budget-2025-html]

[OBR Economic and Fiscal Outlook: https://obr.uk/efo/economic-and-fiscal-outlook-november-2025/]

[Clean Power 2030 Action ](https://www.addleshawgoddard.com/en/insights/insights-briefings/2025/energy/time-action-uk-governments-clean-power-2030-action-plan/)

[Ofwat PR24 Determinations](https://www.slaughterandmay.com/insights/horizon-scanning/uk-energy-and-infrastructure-what-s-to-come-in-2025/)

[The Business Times on Productivity surge]( UK productivity surge signals economic turnaround: study – The Business Times)

---