New supercomputer for Scotland and funding for Acorn Project set to be confirmed in Spending Review

The Chancellor will announce £750 million to build the UK’s new national supercomputer at the University of Edinburgh, which ministers say will give scientists across the country the computing power they need to carry out cutting edge research in fields such as medicine, air travel, and climate change.

Along with funding for the Acorn Project, a carbon capture scheme in Aberdeenshire, the move represents what Labour will argue is significant investment in Scotland from the UK government's spending review.

Ms Reeves will vow to “invest in Britain’s renewal” , while unveiling big increases in funding for the NHS, defence and schools as part of a spending review set to include £113 billion of investment thanks to looser borrowing rules.

The supercomputer plan was shelved by Prime Minister Sir Keir Starmer’s Labour government last August amid reported concerns the project was not focused enough on artificial intelligence.

Responding to the project’s revival, Secretary of State for Scotland Ian Murray said: "This is a landmark moment and will place Scotland at the forefront of the UK's technological revolution. The £750 million investment in Edinburgh's new supercomputer places Scotland at the cutting edge of computing power globally.

“This will see Scotland playing a leading role in creating breakthroughs that have a global benefit - such as new medicines, health advances, and climate change solutions. This is the Plan for Change – delivering real opportunities and economic growth for communities across Scotland."

Professor Sir Peter Mathieson, Principal and Vice-Chancellor of the University of Edinburgh, said: “This significant investment will have a profoundly positive impact on the UK’s global standing, and we welcome the vast opportunities it will create for research and innovation.

"Building on the University of Edinburgh's expertise and experience over decades, this powerful supercomputer will drive economic growth by supporting advancements in medicine, bolstering emerging industries and public services, and unlocking the full potential of AI. We look forward to working alongside the UK Government and other partners to deliver this critical national resource.”

The new supercomputer will vastly exceed the capacity of the UK’s current national supercomputer, ARCHER2.

Another announcement expected is Acorn, the carbon capture project, based in St Fergus, which would take greenhouse gas emissions and store them under the North Sea, in a process known as carbon capture and storage (CCS). It has been in the pipeline for years and would allow fossil fuels to continue to be burnt without, in theory, releasing harmful carbon emissions.

Making the announcements, Ms Reeves will argue that this investment is “possible only because of the stability I have introduced” after the October budget.

She will say: “The priorities in this spending review are the priorities of working people.

“To invest in our country’s security, health and economy so working people all over our country are better off.”

The Chancellor has also already announced some £15.6 billion of spending on public transport in England’s city regions, and £16.7 billion for nuclear power projects, the bulk of which will fund the new Sizewell C plant in Suffolk.

UK ministers have also announced a “multi-billion” pound redevelopment of HM Naval Base Clyde - home to nuclear submarines armed with Trident missiles. An initial £250 million in funding has been allocated to the Faslane base over three years to support “jobs, skills and growth”.

The spending review is also expected to set out tough spending limits for departments other than health, defence and education.

Although Ms Reeves is reported to have agreed to an above-inflation increase in the policing budget, this is thought to have come at the expense of cuts in other parts of Home Office spending.

Ahead of the spending review, the Institute for Fiscal Studies has warned that any increase in NHS funding above 2.5 per cent is likely to mean real-terms cuts for other departments or further tax rises to come in the budget this autumn.

Speaking ahead of the statement, SNP Westminster leader Stephen Flynn claimed the real test for Labour would be whether it kept its “devastating austerity cuts”.

He said: "This is a test of values. Voters were promised change but the cost of living is sky-high, poverty is soaring to record levels on Keir Starmer's watch - and Labour Party austerity cuts are making things even worse. Unless the Chancellor changes course, more families will fall into deprivation and destitution as a direct result of Labour government failure.

"The Chancellor must abandon Labour Party austerity cuts and deliver urgent support to tackle poverty and help families with the cost of living - and Scotland must not be treated as an afterthought when it comes to investment.

"It is essential that Scotland finally gets its fair share of capital investment to boost economic growth and create jobs. That means immediately funding vital Scottish energy projects, including Scottish carbon capture, instead of the Labour government constantly cutting and delaying projects in Scotland while pumping billions of pounds into the south of England.”

The Chancellor has already insisted that her fiscal rules remain in place, along with Labour’s manifesto commitment not to increase income tax, national insurance or VAT.

She will say on Wednesday: “I have made my choices. In place of chaos, I choose stability. In place of decline, I choose investment. In place of retreat, I choose national renewal.

“These are my choices. These are this Government’s choices. These are the British people’s choices.”

Speaking ahead of the statement, Scottish Labour MP Brian Leishman also claimed the focus must be on “no cuts”.

Scottish Labour MP Graeme Downie urged ministers to focus on making the public feel better off.

He said: “We need to prioritise measures that actually puts money in people's pockets and makes them feel like things are getting better. We can't just brow beat them with figures. We've done the right thing with ‘tough choices’ but people will have to feel some short term benefits as well as the longer term benefits of the incredible investment we're making in public services and infrastructure.”

Scottish Tory John Coopers said he hoped the Chancellor would look at again at changes to inheritance tax and the increase in employer's national insurance contributions.

Liberal Democrat MP Christine Jardine expressed hope to see support for those on benefits during this "cost of living crisis".

Sir Keir rejected the idea that he had reversed course on winter fuel payments amid political pressure.

"We had to take difficult decisions in the budget; the economy was broken," he told Jeremy Vine on BBC Radio 2.

But he cited recent growth figures and falling interest rates as proof that "the economy has stabilised".