Rachel Reeves has set out the next phase of the government’s growth plan, framing it around economic security, stability, investment and reform in a more uncertain global environment. The strategy focuses on three main opportunities for growth in Britain: a closer and more stable economic relationship with the EU, a step change in Artificial Intelligence and frontier technology, and stronger growth across every region and nation of the UK. The government said decisions on closer UK-EU alignment will be guided by new National Interest Principles designed to support long-term growth, reduce business costs, strengthen resilience, and provide firms with greater certainty.
Under those principles, the UK will consider aligning with EU rules where it boosts long-term growth and benefits consumers, supports investment and better jobs, preserves or enhances UK security and resilience, and provides stable, forward-looking certainty for business. The government said this will not mean a return to free movement. It also pointed to a shared burden-reduction agenda: the EU is targeting a reduction in administrative burdens of at least 25% for all businesses and 35% for SMEs, including cutting recurring administrative costs by €37.5 billion by the end of its mandate; the UK has committed to cutting the administrative burden of regulation by 25% by the end of the Parliament – or £6 billion savings per year for businesses. A new business engagement programme will increase consultation with companies on EU regulatory issues and upcoming rules.
Regional growth measures include City Investment Funds, with £2.3 billion of new grant, loan, and patient capital funding to be deployed by mayors in the largest city regions, focused in the North and Midlands. The Oxford-Cambridge Growth Corridor will receive funding doubled to £800 million to remove barriers to development, while the Treasury will prepare a roadmap for future fiscal devolution at Autumn Budget. Other measures include the IS-8 cluster partnerships programme, backing five areas in the north, including through £150 million clusters investment from the British Business Bank, and £10 million to support Team Derby. The government also said new funding (£2.3 billion for the City Investment Funds and £100 million loans package for Cambridge) will be accounted for scored at the Autumn Budget 2026.
On innovation, the government said it wants the UK to become the fastest adopter of Artificial Intelligence in the G7. New Growth Labs will introduce cross-economy sandboxing powers to test innovations in live markets with targeted, time-limited regulatory changes and close supervision. A Sovereign Artificial Intelligence Unit, backed by £500 million, will launch 16 April to help leading UK Artificial Intelligence firms scale while remaining in the UK. The plan also includes up to £2 billion over the next decade for quantum technology, including over £1 billion in the next four years and up to £1 billion to buy commercial-scale quantum computing capability in the UK beyond 2030. An Artificial Intelligence Adoption Summit will be held in June during London Tech Week, and a new Artificial Intelligence Economics Institute will examine the impact of Artificial Intelligence on jobs and productivity.
