Chancellor Rachel Reeves is preparing to deliver a highly anticipated spending review that will shape the UK’s fiscal and economic strategy in the years ahead. Scheduled for June 11, 2025, the review arrives amid growing economic pressure, rising inflation, and demands for investment in key public services. Reeves is tasked with balancing the Labour government’s commitments to regional development and public sector pay with the realities of a projected £21.9 billion fiscal shortfall. As anticipation builds, analysts are identifying clear winners and losers likely to emerge from the forthcoming budget decisions.
Among the clear winners are communities in the North and Midlands. Reeves has announced a £15.6 billion commitment to improve transport infrastructure outside of London, part of the government’s plan to reduce regional inequality and boost productivity. This includes investments in metro and tram systems for Birmingham, Leeds, and the Nottingham-Derby area, as well as the construction of a new railway line between Manchester and Liverpool. The chancellor has framed this regional spending as essential for levelling up and supporting economic growth in areas historically underserved by infrastructure investment.
Public sector workers also stand to benefit, with the government pledging £11.6 billion in pay increases. This includes a new two-year pay deal for junior doctors, with an average salary uplift of 22%. Reeves has emphasized the importance of addressing workforce shortages in the NHS and other key public services, highlighting that fair pay is crucial for recruitment and retention. These wage boosts are part of a broader strategy to stabilize vital services following years of strain.
However, not all sectors will come out ahead. Welfare recipients and some pensioners may face losses, as Reeves seeks to find £8.1 billion in savings to meet budget targets. The chancellor is reportedly planning to phase out Winter Fuel Payments for pensioners who are not on means-tested benefits, a decision that has raised concerns about support for vulnerable older citizens. Furthermore, changes to inheritance tax relief for agricultural land and family-owned businesses could significantly impact rural communities and small business owners.
The civil service is also expected to be affected by the review, with a proposed 10% cut to administrative budgets across departments. These reductions, which aim to save £1.5 billion by 2028, are likely to result in job losses, particularly in human resources, IT, and communications roles. As Reeves finalizes her proposals, the government faces mounting scrutiny over how it will balance economic responsibility with social fairness and investment.
