UK Invests £62 Million in Homegrown Satellite Communications and Space Technology

Homeland July 28, 2026

AWE Nuclear Security Technologies and Space Park Leicester have established a strategic partnership, building on two decades of joint working between the organisations

A £62 million funding package for domestic satellite communications and space innovation strengthens the UK’s national security and economic resilience in a strategically critical sector – and signals growing opportunity across the space technology supply chain.

The UK government has announced more than £62 million in funding to develop homegrown space technologies, with investment targeting satellite communications, space domain awareness, in-space manufacturing and early-stage space innovation across industry, universities and research organisations. Unveiled at Farnborough International Airshow by Space Minister Liz Lloyd, the package is designed to reduce the UK’s dependence on international partners for technologies and services it cannot afford to be without, while building the domestic industrial capability needed to compete in an increasingly contested and commercially significant space economy.

The investment is structured across three programmes. The Connectivity in Low Earth Orbit programme is opening its third funding round, offering £42 million to UK businesses, universities and research organisations to develop new satellite communications technologies across five focus areas: on-board processing, active antennas, optical links, networking and routing, and user terminals. This round will bring total C-LEO funding to UK organisations to up to £77 million, reflecting both the strategic importance of sovereign satellite communications capability and the growing commercial market for low earth orbit connectivity services – from broadband for remote communities to mobile connectivity on rail, in the air and at sea.

The National Space Innovation Programme is launching a separate £20 million funding call across all areas of space technology, with projects due to begin in April 2027 and up to 40% of the budget focused on Space Domain Awareness and In-Space Assembly and Manufacturing. Both are areas where domestic capability is considered strategically vital. Space domain awareness – the ability to monitor, track and protect assets in orbit – has become an increasingly urgent national security priority as the number of satellites in orbit grows and the risk of congestion, debris and deliberate interference rises. In-space manufacturing represents an emerging commercial frontier that the UK is positioning to enter at an early stage.

A third strand, the Space Clusters Infrastructure Fund, is inviting organisations to register interest ahead of a new funding call launching in autumn that will award £37 million in grants by 2030. The fund directly addresses the fragmentation of the UK’s domestic space sector, building regional space infrastructure and reducing dependence on international partners for access to critical assets. A pilot phase has already delivered 13 projects across the UK, establishing the regional foundation on which this next round will build.

The funding announcement is accompanied by new figures from the UK Space Agency’s Accelerator programme, which has supported 289 founders, helped raise more than £102 million in investment, created 209 jobs and seen 89% of supported businesses still trading since 2021. The data underlines both the viability of the domestic space startup ecosystem and the role that structured government support plays in translating early-stage innovation into sustainable commercial businesses.

Space Minister Liz Lloyd framed the investment in explicitly strategic terms. Space, she said, is not just a scientific frontier but a strategic one – and failing to build national capabilities at home creates dependency on others for technologies the UK cannot afford to be without. The language echoes the wider defence and industrial strategy narrative around sovereign capability, supply chain resilience and the risks of over-reliance on international partners in an increasingly volatile geopolitical environment.

For the UK defence supply chain

Space is no longer a peripheral consideration for the defence supply chain. Satellite communications, space domain awareness and in-orbit capabilities are increasingly central to military operations across every domain, and the UK’s investment in building domestic capability in these areas creates a growing and accessible pipeline for businesses operating across the space and defence technology intersection. For companies in advanced electronics, photonics, software, AI, precision manufacturing and systems integration, the combination of C-LEO, NSIP and SCIF funding represents a structured set of entry points into a sector with both commercial and defence application.

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