The 2025 Spending Review: A Crucial Moment for School Funding

The UK government’s 2025 Spending Review is set to define the fiscal landscape for education over the coming years. For schools, the headline concern is funding stability amidst rising operational costs. While initial projections suggested only modest uplifts in core budgets, the final review brought some better-than-expected news – though significant challenges remain. 

The Spending Review, published on 11^th June 2025, confirmed £4.7 billion in additional funding for schools and multi-academy trusts. This increase will primarily support: 

This equates to a 1% increase in overall school funding – a modest rise, but more than many in the sector were expecting. 

In addition, the government committed to a separate £4.7 billion in annual capital investment to fix classrooms and rebuild schools in the greatest need, addressing long-standing issues with deteriorating infrastructure. 

Despite these announcements, many school leaders remain concerned. Inflationary pressures continue to affect staffing, energy and supplies – all of which erode the real value of any funding uplift. The Institute for Fiscal Studies (IFS), in its pre-review analysis, warned of a real-terms decline in school resources without sustained increases. 

This could lead to: 

Additionally, there remains uncertainty around long-term investment in digital infrastructure and special educational needs (SEN) provision, both of which are under increasing strain. 

Read the full IFS analysis: IFS Schools & Colleges 2025 Spending Review 

In response to the Spending Review, school leaders are encouraged to take a strategic and proactive stance, focusing on: 

Sustained investment in education is not just a policy matter – it is essential to social mobility, economic growth and national productivity.

Summer 2025 Update
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