British businesses, universities and researchers can now bid for more than £62 million in government funding to develop domestic satellite communications and space technology, according to ministers who say it is necessary to stop the UK becoming dangerously dependent on others for skills it cannot do without.
The package, unveiled by Space Minister Liz Lloyd on Monday as the record Farnborough International Airshow opened, is split into £42 million for new British satellite communications technology and £20 million for space innovation projects across industry and academia.
“Space is not just a scientific frontier, it’s a strategic one,” said Lloyd. “If we don’t build national skills at home, we become overly dependent on others for technology that we can’t have.”
For small companies, the most important detail is how the money will be released. The £42 million comes in the third funding round of the Connectivity in Low Earth Orbit (C-LEO) programme, which is open to UK businesses, universities and research organisations. Projects must focus on at least one of five areas: on-board processing, active sticks, optical links, network and routers, or user terminals. The round takes total C-LEO funding to UK organizations to £77 million.
The desire to sell is evident. Learning startup NewOrbit recently raised £13.8 million to build ultra-low Earth orbit satellites, attracting engineers from SpaceX and Nasa to Berkshire in the process.
The remaining £20 million comes through a new call for the National Space Innovation Programme, with projects due to start in April 2027. Funding comes in two forms: Kick Starter, for early-stage ideas, and Big Projects, for businesses looking to grow and sell. Up to 40 per cent of the budget is earmarked for Space Awareness and Spatial Intelligence and Production, two areas where domestic capabilities are considered critical to the UK’s ability to understand and respond to threats in orbit. It’s a market British firms are chasing, as SatVu demonstrated when it received £30 million including NATO Innovation Fund support for its thermal imaging constellation.
There is a third strand of the patient. The Space Clusters Infrastructure Fund is inviting organizations to register interest ahead of a call for funding to be launched in the autumn, which will award £37 million in grants by 2030, building on a pilot phase that has delivered 13 projects across the UK.
The announcement came with proof that early support for the sector is paying off. A new report from the UK Space Agency shows that its Accelerator program has supported 289 founders since 2021, helping them raise £102.2 million in investment and create 209 jobs, with 89 per cent of supported businesses still trading.
Phil Merchant, principal and head of aerospace technology at Marks & Clerk, an accelerator-affiliated think tank, said the funding was long overdue.
“This news is very welcome in an industry where, in terms of funding, the UK continues to lag behind its European counterparts. Like AI, space technology is a field with potential to be used in many sectors, including Agritech, cybersecurity, and communications, and will be a driver of economic growth in the future.
“By funding homegrown innovators and scientists early on, companies can be given the breathing space to not only develop good science, but commercialize their inventions. This includes a greater focus on their intellectual property, protecting and leveraging it which is vital to providing a strong foundation for continued growth within the UK’s borders.”
For founders looking at this sector, the message is clear enough: calls for C-LEO and innovation are now open, and the infrastructure fund follows in the fall. It turned out that space no longer holds governments and billionaires. It is a time-bound grant program.
