A look at the 2021 Autumn Budget and Spending Review

Yesterday the Chancellor of the Exchequer Rishi Sunak delivered his long-awaited Autumn Budget and three-year Spending Review. The Chancellor struck an optimistic tone as he looks to move the country forward on the road to recovery following the COVID-19 pandemic. The Chancellor also announced a raft of new support measures for businesses and a strong focus on R&D investment.

What was announced for ADS’ sectors

A key ask of ADS’ Spending Review submission to the Treasury was around support for the Aerospace Technology Institute whose funding was due to end in 2026. ADS is pleased to see the Government will support the UK aerospace sector by extending funding to the ATI out to 2031 with co-investment with industry. The new longer-term commitment will enable ADS members in the aerospace sector to plan longer-term investment in new lower emissions aircraft technology in the UK to help deliver net-zero emissions in aviation by 2050.

More broadly, the Government confirmed an increase in capital expenditure in R&D funding including a £3bn increase within the Department for Business, Energy and Industrial Strategy per annum to help deliver the Government’s Innovation Strategy.

The commitments in the recent Defence Command Paper on the funding announced for the MOD back in November 2020, including its £6.6bn investment in R&D were reaffirmed in today’s Budget. Furthermore, following the launch of the National Space Strategy last month, the Chancellor confirmed the Government will continue to invest funding for the UK’s first commercial space launch in 2022.

Wider Budget annoucements

Separately there were announcements on changes to Air Passenger Duty for domestic and ultra-long-haul flights, a rise in the National Living and Minimum Wage and changes to business rates to help support UK businesses.

The Chancellor also outlined a more positive outlook for the wider economy, with GDP growth forecasts revised upward on previous forecasts. However, there were warnings about the rate of inflation in the UK with the Chancellor looking to support people with the looming rising cost of living this winter.

Over the weeks ahead ADS will continue to work closely on the details of what was announced in the Budget and Spending Review and continue to engage with the Government constructively on our members shared priorities.

Commenting on today’s fiscal event, ADS Chief Executive Kevin Craven said:

“Today’s welcome commitment to extend Aerospace Technology Institute funding to 2031 recognizes the need for long-term partnership to achieve our net zero goals and make the UK a global leader in green aerospace technology.

“Support for cutting edge aerospace innovation will sustain jobs, level up opportunities in every part of the country, and help to secure billions of pounds in industry investment.

“Our members will be looking for early clarity on an ATI funding level that matches industry ambitions here in the UK to deliver net zero aviation.”

ADS members can download a full ADS summary of the 2021 Autumn Budget and Spending Review by clicking here and logging into the ADS website.

Further information is available on the 2021 Autumn Budget and Spending Review online here and you can read the Chancellor’s Spending Review speech here.