The UK government has launched a funding package worth more than £62 million to support the development of British satellite communications and space technologies, as ministers seek to strengthen the country’s domestic capabilities in a rapidly growing and strategically important sector.
The announcement was made by Space Minister Liz Lloyd on Monday at the opening of the Farnborough International Airshow. The investment includes £42 million for satellite communications technology and a further £20 million for space innovation projects involving businesses, universities and research organisations.
Lloyd said the UK must build its own expertise in critical space technologies to avoid relying on foreign suppliers for capabilities that are increasingly important to national security and economic growth.
“Space is not just a scientific frontier, it is a strategic one,” Lloyd said. “If we do not build national capabilities at home, we become overly dependent on others for technologies we cannot afford to be without.”
The largest share of the funding, £42 million, will be distributed through the third round of the Connectivity in Low Earth Orbit (C-LEO) programme. UK businesses, universities and research institutions are invited to apply for grants focused on five priority areas: on-board processing, active antennas, optical communications, networking and routing, and user terminals.
The latest round increases total C-LEO funding awarded to UK organisations to as much as £77 million.
Britain’s commercial space industry has already attracted growing investment. Reading-based start-up NewOrbit recently secured £13.8 million to develop satellites designed for very low Earth orbit, attracting engineers with experience from SpaceX and NASA.
The remaining £20 million will be awarded through a new National Space Innovation Programme competition, with successful projects expected to begin in April 2027. The programme will support both early-stage concepts through its Kick Starter route and larger commercial projects through its Major Projects stream.
Up to 40 per cent of the funding has been reserved for Space Domain Awareness and In-Space Assembly and Manufacturing, areas viewed as essential for improving the UK’s ability to monitor activity in orbit and respond to potential threats.
British companies are already making progress in these fields. Satellite company SatVu recently raised £30 million, including backing from the NATO Innovation Fund, to expand its thermal imaging satellite constellation.
The government also announced plans for a £37 million Space Clusters Infrastructure Fund, with applications opening this autumn. The grants will be awarded through 2030 and build on an earlier programme that supported 13 projects across the UK.
A report released by the UK Space Agency highlighted the impact of previous government support. Since 2021, its Accelerator programme has assisted 289 founders, helped secure £102.2 million in private investment and created 209 jobs, while 89 per cent of participating businesses remain active.
Phil Merchant, principal and head of space technologies at intellectual property firm Marks & Clerk, welcomed the funding, saying it would help British innovators develop new technologies, protect intellectual property and bring their ideas to market while strengthening the UK’s long-term position in the global space industry.
