Spending Review 2025: interactive investor comments
The government’s latest spending review promises sizeable investment across critical sectors, from infrastructure and healthcare to housing and education.
11th June 2025 13:27
by Myron Jobson from interactive investor
Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “This Spending Review tees up what is set to be the most consequential Budget in a generation come autumn. It lays bare the government’s increasingly difficult balancing act: contending with the rising cost of debt servicing; the need to drive economic growth; invest in defence and meet public sector spending demands - all while trying to remain within its self-imposed fiscal rules.
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“The government’s latest spending review promises sizeable investment across critical sectors, from infrastructure and healthcare to housing and education. While these commitments will be welcomed by many, they come at a time when the public finances remain under considerable strain. Given the tight budget envelope, something will inevitably have to give. That could mean cuts in other areas, a rise in taxes - either directly or by stealth via the extension of frozen tax thresholds - or a combination of both. Ultimately, the cost of these pledges will need to be met, and the burden may fall more heavily on households already grappling with a rising cost of living.
“At the same time, the personal finance landscape remains in a state of flux. Changes to the ISA regime, inheritance tax, and pension rules are all in the pipeline, and the U-turn on cuts to the winter fuel payment signals the piecemeal nature of support measures. This constant state of change can make it difficult for people to plan with confidence - particularly around long-term goals like retirement. Stability, especially when it comes to pensions, is vital to enable effective and proactive planning.
“In this ever-shifting environment, individuals need to stay nimble but not reactionary. Making full use of available tax wrappers, such as ISAs and pensions, remains one of the most effective ways to protect and grow your wealth. But it’s equally important to avoid knee-jerk decisions based on speculation that could have long-lasting financial consequences. A measured approach is the best defence against the uncertainty that continues to define the current personal finance landscape.”
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