The UK Government has announced a £86 billion funding package aimed at enhancing the country’s science and technology sectors
The investment, set to reach £22.5 billion annually by 2029/30, is part of the government’s wider Plan for Change and its commitment to drive economic renewal through a Modern Industrial Strategy.
This package is designed to support breakthroughs in sectors such as life sciences, advanced manufacturing, artificial intelligence, clean energy, and defence. Backed by a strong focus on regional development, the initiative includes up to £500 million specifically allocated to support local innovation and economic growth through the creation of regional innovation clusters.
Supporting local leadership and regional innovation
A big part of the announcement is the introduction of a new Local Innovation Partnerships Fund, which will allow regional leaders to shape their own research and development agendas.
Each of the seven existing Mayoral Strategic Authorities in England will receive at least £30 million, alongside equivalent awards in Scotland, Wales, and Northern Ireland. A competitive element of the fund will also be open to all UK regions, supporting high-potential innovation clusters in collaboration with UK Research and Innovation (UKRI).
Richard Parker, Mayor of the West Midlands, said:
“This is exactly how we turn our potential into progress. This investment backs regions to lead the way in the industries that will define the future”
“This will drive innovation that not only grows the economy but creates jobs, builds opportunity, improves health, and changes lives.”
Driving growth from Liverpool to Belfast
The investment is expected to benefit all areas of the UK. In Liverpool, funding will build on the city’s strengths in life sciences to accelerate drug discovery. In South Wales, the semiconductor sector is set to receive a boost, enhancing domestic capabilities in chip design for everyday devices. Northern Ireland’s defence manufacturing capacity will be strengthened to support national security.
The initiative builds on the success of the Innovation Accelerator pilot program, which has supported projects such as Greater Manchester’s diagnostics technologies and AI-powered transport disruption solutions developed in the West Midlands.
National and regional partnerships
In addition to the regional cluster funding, the government will support a new collaboration between Manchester and Cambridge, two of the UK’s most dynamic innovation hubs. With £4.8 million over three years, the Cambridge x Manchester Innovation Partnership will test scalable approaches to regional growth through university-led collaboration and enhanced business engagement.
Long-term economic impact
With around 2.8 million people already employed in R&D-related jobs, the government estimates that each £1 invested in R&D generates up to £7 in economic benefits, as well as doubling private sector investment.
Businesses that secure early-stage government R&D funding have seen job creation and turnover increase by over 20% in subsequent years.
This announcement also follows previous commitments, including £15.6 billion for regional transport improvements across the North, Midlands, and South West, showing a joint approach to long-term regional development.
The package supports the government’s updated Green Book principles, making sure value for money and strategic investment in regional and national priorities as part of the UK’s broader economic renewal strategy.
