Gov’s 2025 Spending Review Delays UK Gigabit Broadband Target to 2032 UPDATE

The UK Government’s Chancellor of the Exchequer, Rachel Reeves, has today delivered her 2025 Spending Review, which included a few bits of new information and updated figures for telecoms. But as well as confirming £1.9bn for broadband and mobile projects (existing commitments), it also appeared to reflect a delay to the gigabit broadband roll-out from 2030 to 2032.

The latest Spending Review sets out the planned day-to-day spending totals for all government departments for the years from 2026/27 to 2028/29, and investment spending plans for a further year (from 2026/27 to 2029/30). This covers all the spending that can reasonably be planned in advance, making up about 40% of all public spending (the remaining spending is usually driven by demand that can’t be planned, such as benefits).

The UK telecoms industry will be keeping a close eye on the latest review, not least for any potential dilution in terms of the government’s commitment toward fixed broadband and mobile networks. The previous Autumn 2024 Budget already committed “over £500m of funding next year” for “improving reliable fast broadband and mobile coverage across our country, including in rural areas“, but the Spending Review covers a wider period.

However, over the past few months we’ve also seen talk about the government potentially cutting some of the c.£2bn that remained unspent within their £5bn Project Gigabit broadband roll-out scheme (i.e. expanding gigabit-capable broadband “nationwide” (c.99% of the UK) by 2030), as well as potentially also reducing their £501m commitment to the £1bn industry-led Shared Rural Network (SRN) project that is expanding 4G mobile coverage into rural areas.

Speaking of which, mobile operators have also been pressing the government for changes in annual licence fees, planning and other areas to help boost 4G and 5G deployments (here). But much of that is perhaps more of a focus for the forthcoming Infrastructure Strategy than this review.

What’s in the 2025 Spending Review

Overall, there isn’t a lot of detail on broadband and mobile matters in the full Spending Review 2025 Document, but this did stick out.

Spending Review Statement on Broadband and Mobile

The SR provides £1.9 billion over the SR period [2026/27 to 2029/30] for Building Digital UK (BDUK) to deliver the next phase in the transformation of the country’s digital infrastructure. This includes:

➤ Connecting more homes and businesses to gigabit-capable broadband to reach 99% of UK premises by 2032. BDUK will focus delivery in this SR period on achieving greater coverage in Scotland and Wales, and refresh delivery plans ahead of the Spending Review 2027; and

➤ Working with industry to deliver the Shared Rural Network so the most remote areas have 4G coverage.

This settlement provides up to £1.9 billion over the SR period to deliver a modern digital government. This includes the rollout of new products and services such as the GOV.UK Wallet and App, and productivity-enhancing AI tools across the public sector, and replacing legacy systems.

Ofcom currently forecasts that gigabit-capable broadband should reach around 97-98% of UK premises by May 2027 (here) and so the reality here is that the country should still get very close to that 99% figure by 2030. On the other hand, Project Gigabit, which is focused on upgrading the hardest-to-reach areas (often remote rural locations) has recently suffered a number of contract failures as alternative networks pulled out.

For example, alternative network operator FullFibre Limited recently “mutually agreed to terminate” their Project Gigabit broadband roll-out contracts for the Derbyshire Peak District and Herefordshire area (here), which came after Voneus did the same for Mid West Shropshire (here) and Freedom Fibre followed for Cheshire (here).

The losses aren’t huge, but they do help to underline the wider challenges in today’s market (i.e. higher build costs, high interest rates, competition etc.), which could make tackling that final 1-2% of premises even more of a challenge – one that it seems will now take a couple of years longer than previously planned to resolve. On the flip side, it’s positive that the government has finally confirmed a solid funding pledge to tackle this area.

UPDATE 1:57pm

The first comment has just come in.

Till Sommer, Head of Policy, ISPA UK, said:

“The rollout of gigabit broadband is one of the largest infrastructure projects of its generation, funded overwhelmingly by industry. With 86% of homes now able to access gigabit speeds, we’re at a critical juncture with rollout. The remaining 14% are the most challenging to connect, and this is exactly where Project Gigabit funding matters most to deliver on a new government target of 99% gigabit-capable broadband to UK premises by 2032.

We welcome the £1.9 billion committed over this Spending Review period, which will be important in fuelling the Government’s growth agenda, with digital connectivity providing the backbone of the growth areas in the Government’s Industrial Strategy.

Equally, we urge the Government to double down on efforts to reduce barriers to rollout, to ensure that additional funding is translated into connectivity gains as soon as possible. Clear, consistent support for Project Gigabit is essential if we are to finish the job and ensure no community is left behind in the UK’s digital future.”

UPDATE 12th June 2025 @ 8:34am

CityFibre sent in a response yesterday too.

A CityFibre spokesperson said:

“As a significant partner on Project Gigabit, we’re working hard to bring full fibre connectivity to 1.3 million premises which, otherwise, would have missed out. Work is underway in all nine of the areas where we’ve been awarded contracts and, whilst there is much work to be done, we welcome the ongoing commitment to Project Gigabit and the real benefits it will bring.”