How Reeves’ Spending Review Shapes the Grower Landscape

As the dust settles on Chancellor Rachel Reeves’ first Spending Review, UK growers—particularly those producing fruit, vegetables, and flowers—are examining the fine print for clues about their future.

While the headline announcements focused on economic growth, infrastructure, and green investment, the real story for horticulture lies in what’s quietly unfolding behind the scenes.

From environmental subsidies to labour guarantees and R&D pledges, this review sets the tone for how government will support (or stretch) the industry in the years ahead. For an essential sector grappling with labour shortages, climate pressures, and global market competition, the question is clear: does this budget help growers thrive, or simply survive?

A Balanced Settlement, But Real‑terms Squeeze

Chancellor Rachel Reeves allocated £7.4 billion to DEFRA through 2028–29—matching prior funding levels and quelling fears of drastic cuts to farm support. Within this envelope, £2.7 billion annually is committed to farming and nature recovery, beginning in 2026. While this endowment maintains nominal funding, industry bodies have cautioned that an estimated £100 million cut from programmes like the Sustainable Farming Incentive, Countryside Stewardship, Landscape Recovery, and capital grants means growers must “do more with less.”

Green Priorities: Expansion of ELM Schemes

Spending on Environmental Land Management (ELM) schemes will increase from £800 million in 2023–24 to £2 billion by 2028–29—a staggering 150% uplift. DEFRA expects growers to embrace practices like pollinator margins, hedgerows, soil health enhancement, and integrated pest management, especially in horticulture where biodiversity links directly to crop success.

Infrastructure Backing: Flood Defences and Climate Resilience

The government pledged £4.2 billion over three years to bolster flood defences—a 5% real‑terms increase. This benefits growers operating in low‑lying zones, such as the Fens, safeguarding fruit, veg, and flower operations from flooding and enhancing climate resilience.

Innovation & Research: A Big R&D Bet

Nationwide R&D funding will rise to approximately £22 billion per year, with dedicated investments in AI, start‑ups, and tech. While mainly economy‑wide, horticultural innovators—especially in automation, controlled environment agriculture, and climate‑resilient crop science—stand to benefit. DEFRA’s Farming Equipment and Technology Fund, along with broader Farming Innovation initiatives, are set to continue, though their exact funding levels await further detail.

Labour Landscape: Seasonal Workers Scheme Secured

Though not detailed explicitly in the Spending Review itself, recent policy confirmed the Seasonal Worker visa scheme will be extended through 2029, allowing around 45,000–55,000 visas annually. Much of the industry has welcomed this reassurance after years of labour shortages—vital for horticulture, with up to 95% of those roles filled by migrant workers.

What’s Missing: Trade, Imports and Export Dynamics

Notably, the Spending Review omitted any trade‑related provisions for horticulture—no mention of import tariffs, export incentives, or protection mechanisms. Growers must continue to navigate existing trade frameworks post‑Brexit without new support. FPC and others are lobbying separately for greater protections in future trade negotiations, but this remains external to the spending review.

Growers: Navigating the New Terrain

Area	Implication	What Growers Should Do
Funding	Flat nominal budget; slight real‑terms squeeze	Use ELM and productivity grants strategically
ELM Expansion	Major opportunities for eco‑practices	Prepare to adopt biodiversity schemes
Innovation & R&D	Access to broader tech funding	Explore automation, greenhouse, and climate tech
Labour certainty	Seasonal visas extended	Recruit confidently; plan ahead
Infrastructure	Flood resilience investment	Engage with local authorities for project alignment
Trade	No new support announced	Lobby through industry bodies for trade safeguards

Ultimately, Rachel Reeves’ Spending Review on 11 June 2025 underscores a UK government pivoting its support for food production toward sustainability—rewarding environmental stewardship over traditional cash payments. While growers may feel budgets tighten slightly, the expanded ELM payments, R&D investments, and labour certainty offer new opportunities.

However, the lack of trade measures means horticulture must lean into innovation and environmental compliance to stay competitive.

Clarity will hinge on forthcoming DEFRA allocations, ring‑fenced grant rounds, and the practical rollout of environmental schemes. As policy unfolds, horticultural businesses—particularly those in fruit, veg, and flower production—must position themselves as eco‑savvy, tech‑forward, and resilient to climate-influenced infrastructure change.