On October 30th, 2024, the UK Government released its first Labour-led Budget since 2010, introducing new fiscal policies announced by Chancellor Rachel Reeves. 

To address the near-£22 billion shortfall inherited from previous leadership, Labour promised to implement strategic cost-saving initiatives, initially targeting £5.5 billion in savings for the 2024-25 fiscal year, with an increase in savings to £8.1 billion planned by 2025-26.

It's crucial for suppliers—especially those across technology, infrastructure, and healthcare—to understand the departmental allocations outlined in the Autumn Budget, as well as Labour's focus on cost-effectiveness and innovation. 

Suppliers can gain a competitive edge in the coming year by aligning their offerings with the Government's objectives and proactively engaging with relevant stakeholders.

This report aims to inform readers across two key areas:

1. An overview of the Autumn Budget's implications for suppliers to public sector organisations. It aims to help suppliers navigate the changing procurement landscape and stay updated on Labour's spending priorities for 2025-26.
2. What our procurement data has been saying. Using Stotles' owned data product full of public sector procurement insights, we illustrate the key themes seen since the Autumn Statement in November 2023 to set suppliers up for success during the next campaign and highlight upcoming contract expiries.

For more information on all current government pre-tenders and open opportunities, as well as, upcoming contract expiries, sign up for a free account and kick-start your public sector procurement strategy.

Below are key budget areas that present valuable opportunities for suppliers in the public sector, empowering companies to support the Government’s objectives for a resilient, growth-driven public service framework.

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In addition to the budgetary commitments noted above, the Chancellor also allocated necessary funds for reparations for victims of three core failures stemming from the previous Government’s ineffective public service delivery.

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In association with the Observer, the Guardian’s sister paper, Stotles collaborated on the breaking news surrounding Grenfell and provided insights based on our contract and tender data. You can read about it here.

This section reviews the departmental funding allocations, also known as Departmental Expenditure Limits (DELs), that are published in the Autumn Budget. Suppliers take note, because this is where the key information you require is located to empower your public sector sales strategy.

DELs are broken down into Resource DELs (RDELs), the day-to-day operational costs like wages and consumables, and Capital DELs (CDELs), which is the investment in assets such as buildings and infrastructure. Separate from DELs, the Annually Managed Expenditure (AME) is reserved for more unpredictable, demand-led spending, including pensions, social security, and debt interest.

These departmental expenditure limits provide insight into the Government's public spending priorities for the upcoming fiscal year and can influence suppliers' ability to build pipeline. Depending on where budgets are allocated, projects that were previously expected and part of your strategy may not materialise and in turn cause more competitive procurement environment for particular areas. Conversely, an influx of budget allocation can create new opportunities that were not deemed possible before.

Building pipeline by tracking pre-tender opportunities and upcoming contract expiries has long been a sales strategy for public sector success, however pre-engaging and being able to access the right stakeholder early is a clear route to scaling public sector selling. We advise to keep this in mind when review the departmental allocations and project commitments below.

You can view the line-by-line breakdown of the central Government allocation of departmental budget for the 2025-26 fiscal year below:

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This section focuses on the most pertinent information for suppliers and showcases them in easy-to-consume charts.

The graphic below illustrates the average annual growth expected in DELs across departments between 2023-24 and 2025-26. While it’s clear that in most areas, budgets have grown across the board, an exciting trend to note is the substantial increase in investment for energy security and net zero resources. This signals the UK’s intention to mark a clear route towards a more sustainable nation, with GB Energy at the forefront of this commitment.

For a deeper dive into the public sector’s investment in GB Energy and a procurement market that is growing 33% YoY, click here to read out report highlight how to capitalise on Labour’s sustainability procurement plans.

Additional growth across local governments and small and independent bodies also provides positive indications for suppliers to the public sector, especially those who identify as small and medium-sized enterprises (SMEs).

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Going a level deeper, the Government’s allocations for RDELs are the leading focus for suppliers when tracking departmental spending potential and how to align with procurement opportunities. The general distribution of total RDELs year-over-year remains predictable, with large-scale public services like the NHS, education and defence taking the majority stake in the budget.

The chart below illustrates the top 10 departmental RDELs and the change in funding between 2024-25 and 2025-26. In line with the Government’s phase one of the spending plan announced in the budget, the significant injection of capital into health and social care and education is evident from the chart below.

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The increase across health and social care is no surprise, given the Government’s focus on boosting NHS performance through digital transformation and infrastructure improvements. However, it is interesting to note the there is £192 billion allocated to the NHS of a total RDEL of £200.5 billion, which is over 95%.

Similarly, schools and education received a combined increase of £11.2 billion, with core schools receiving nearly 70% of the allocation,, a total just under £64 billion, compared with this department's total RDEL of £93 billion.

As for the Government’s capital DELs, which are budget allocations specifically for capital-intensive, longer-term projects, they showcase how larger investments create opportunities for businesses to supply infrastructure, construction, and technology services.

Based on figures for 2025-26, capital allocation across transport (£21.8 billion), defence (£21.4 billion), science, innovation and technology (£14.7 billion), and health and social care (£13.6 billion) signal potential more considerable opportunities for suppliers targeting larger projects across these areas.

Transport received the largest allocation towards capital projects, a drop of the outrun figure for 2023-2024. However, the department is expected to increase again in 2025-26, and transport commitments are high on Labour’s agenda.

Both local government and energy-related projects have seen a substantial increase in funding, signalling opportunities for suppliers focused on this area.

Also mentioned in the Budget, the £131 billion allocated for capital resource in 2025-26 will be used to:

• Kickstart the delivery of 1.5 million homes
• Support new industries and job creation, and
• Protect record R&D funding

For a full breakdown of the top 10 CDEL allocations, see the table below.

A rich source of information not found within the budget is government tender and contract data, which is publicly available but difficult to analyse as the information is siloed across different procurement portals. For this section, we analysed three areas in public sector procurement using Stotles’ government contract and tender data. 

For this analysis, the data focuses on contracts awarded to suppliers directly and outside of frameworks. It covers the past 12 months of awarded contracts, with the start date being November 22nd, 2023–the day of the 2023 Autumn Statement release.

In the period following the Autumn budget, nearly 2,000 contracts were awarded by central government departments specifically tagged to IT services. The highest value contract within this sector was awarded by the Ministry of Defence (MoD) at a substantial £2.3 billion. This contract was for a service support agreement spanning combat management systems (CMS), shared infrastructure (SI), and network support, emphasising the ongoing strategic investments within the MoD.

Despite the many contracts awarded, only about 15% were won by small and medium-sized enterprises (SMEs), reflecting smaller suppliers' ongoing challenges when contracting with central government. These barriers often stem from the Government’s preference for larger, established companies with proven capacity to handle extensive and complex requirements. 

To access our central government authorities' report showcasing contracts to target via 2024/2025 commercial pipelines, click here.

The chart below highlights the top buyers by contract volume over the past year, with the Ministry of Defence leading with 160 contracts, followed by NHS England with 107, and DEFRA with 79. This distribution underscores the central Government's focus on defence, health, and environmental agencies for IT investments.

Analysis of supplier engagement shows that the top 20 suppliers capture nearly a quarter of the total contract value, reflecting a concentrated market where a few key players dominate. Computacentre UK and Softcat PLC lead with 45 and 41 awarded contracts, respectively, reinforcing their significant market share and positioning as preferred suppliers. This trend may suggest that successful central government suppliers are typically those that can consistently deliver at scale across various departments.

A monthly breakdown of contract awards since November 2023 reveals that Q1 presented the most successful opportunities for suppliers targeting central government, possibly aligning with fiscal year planning and budget allocations. This insight can be a valuable timing guide for suppliers aiming to enter the market or expand their government contract portfolios.

Below you view and click through to three contracts that will be expiring for central government buyers between three to six months from now. For a full view of expiring contracts, sign up for a free Stotles account here.

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Following the 2023 Autumn Statement, the local government sector has mirrored the central government’s growing emphasis on IT services, awarding nearly 700 contracts related to digital transformation initiatives since November 2023. This surge aligns with the government’s broader strategy to enhance efficiency and technological capacity across various departments. The increased allocation to digital transformation suggests a proactive stance on modernising local government operations, mainly through targeted investments in IT services.

To download our definitive guide to identifying and winning local government contracts in 2024/2025, click here.

The top local government buyers underscore a diverse but concentrated procurement landscape, with various councils and agencies leading contract awards. Understanding these primary buyers offers suppliers insights into strategic entry points for accessing local government opportunities.

Civica UK leads the supplier field within local government with 15 contracts, followed by Softcat PLC with 8 and IDOX Software with 7. Softcat’s presence across central and local government contracts underscores its category-leading public sector market position. These players hold significant market share and are instrumental in facilitating digital upgrades across local councils.

Much like central government, local government contract awards show a notable uptick in Q1 and Q2, suggesting these periods align with the fiscal planning and budgeting cycles at the local level. Suppliers should know this pattern when engaging with public sector buyers and for accurate planning.

The top used CPV codes below also paint a clear picture for suppliers as to what local government buyers are focus on procuring and how they can build CPV code prioritisation into their public sector strategies.

Despite the emphasis on digital transformation, only 13% of awarded contracts in this category have gone to SMEs. This indicates ongoing barriers that small and medium-sized enterprises face within local government procurement, even as government policy increasingly promotes small business involvement and local investment. The UK Government's commitment to expanding SME participation is crucial in addressing these disparities, offering a pathway for smaller suppliers to make headway in local government contracts as support programs and policies gain momentum.

Below you view and click through to three contracts that will be expiring for local government buyers between three to six months from now. For a full view of expiring contracts, sign up for a free Stotles account here.

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As the NHS and other health and social care bodies continue to receive the largest Resource DEL allocations, a significant focus is placed on public sector procurement within the UK’s health services. Since the 2023 Autumn Statement, the NHS has awarded over 7,000 contracts, with SMEs securing around 15% of these opportunities.

While health services are unsurprisingly the dominant CPV code for NHS contracts, a deeper look reveals various other contract categories that may be of strategic interest to suppliers in adjacent sectors.

This breakdown provides valuable insights for suppliers looking to engage with the NHS beyond traditional health services, including sectors such as IT services, digital transformation, and specialised healthcare technology. Suppliers aiming to enter or expand within NHS procurement may find unique opportunities in these secondary categories, particularly as the NHS modernises its infrastructure and service delivery in response to increased RDEL allocations.

Finally, looking at the month-over-month awards activity for suppliers to the NHS, the procurement data aligns both central and local governments signalling the end of Q1 and the beginning of Q2 being the most active time of year for awarded contracts.

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Our guide to NHS budgets with ICSs ranked by 2024/2025 allocation, regions with the largest budget increases and cuts, and tactics to surface opportunities for IT, construction, and professional services suppliers, click here.

Below you view and click through to three contracts that will be expiring for health and social care buyers between three to nine months from now. For a full view of expiring contracts, sign up for a free Stotles account here.

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The 2024 UK Autumn Budget emphasises cost-effectiveness and fiscal accountability, pushing suppliers to demonstrate value through innovation, reliability, and efficiency. Leveraging insights from Stotles and focusing on early signals, qualification, and context-driven engagement is essential for suppliers to maintain a competitive edge. To maximise your chances of success:

1. Initiate contact with buyers well before contract expiration dates. Identify strategic plans and budget documents that may signal upcoming needs, ensuring your team is prepared for pre-market engagement.
2. Move beyond generic messaging; use context from past spending, budget allocations, and buyer challenges to craft outreach that resonates with buyers’ current priorities.
3. Focus on buyers whose past contracts indicate a strong fit with your offerings. Use data to identify public sector organisations that are more inclined to work with SMEs if that’s your strength.
4. Build trust with buyers by helping them understand the range of solutions in your field. Engage in open discussions to align your capabilities with their procurement objectives.
5. Maintain regular contact to stay front of mind during tender evaluations. Consistent, value-based engagement can favour your company as procurement decisions are made.

Suppliers can navigate the complexities of public sector procurement more effectively with these approaches. Stotles’ platform provides critical tools and insights that support these steps, enabling suppliers to identify opportunities ahead of time and position their solutions strategically in front of public sector buyers.