Government grantmaking in the UK is going through a period of significant change. Transparency is no longer optional — government funders are increasingly expected to show where money goes and what it achieves. Outcomes measurement and digital tools are maturing, but the systems they sit on often remain fragmented. The wider funding mix is shifting in ways that place more weight on government grants than ever before. And regional funding programmes are being redesigned in ways that will change how money reaches communities.
Below, we map what’s changing, what it means for government grantmakers, and where to focus next.
Transparency: From Nice-to-Have to Non-Negotiable
The expectation that public funders make their grants data readily accessible has been building for years. Governments have long published data and responded to information requests, but grantmaking details were often buried in lengthy reports, making them difficult to find and use. The shift now is less about whether data is published and more about how easily the public can access it. More than 320 grantmakers across the UK — including 18 central government departments — publish their grants data using the 360Giving Data Standard, covering over one million individual awards worth more than £300 billion.[1] Initiatives like these reflect a growing public demand for data that is not just available in principle, but genuinely accessible in practice.
For government grantmakers, the implications go beyond publishing data. The UKGrantmaking platform’s June 2025 analysis found that trusts and foundations have overtaken government as the largest source of grant income to the voluntary sector [2] — a shift that puts more scrutiny on how public grant funding compares in accessibility, responsiveness, and reporting burden. When philanthropic funders are publishing openly and streamlining their processes, government schemes that remain opaque or cumbersome stand out for the wrong reasons.
The bigger challenge is at the local level, where data remains patchy and capacity to publish is limited.[2] But the direction is clear. Government grantmakers that embrace transparency, not just as a compliance exercise, but as a way to build trust, demonstrate value, and learn from what others are doing, will find it easier to justify their programmes, coordinate with co-funders, and make the case for continued investment.
Outcomes Measurement and Digital Modernisation
The UK has been experimenting with outcomes-based funding longer than most. It launched the world’s first Social Impact Bond in 2010, and the £70 million Life Chances Fund supported 29 outcomes-based programmes between 2016 and 2025. These models have produced real learning, but they’ve stayed niche: the complexity of aligning commissioners, investors, and providers around shared metrics has limited their scalability. The newer Better Futures Fund takes a more pragmatic approach — less financial engineering, more focus on evidence-building and cross-sector coordination.[3]
On the technology side, the Government Grants Management Function has built tools including Find a Grant, a single portal for government grants, mandated since 2023. The National Audit Office (NAO) estimates that better grant management could save up to £1.9 billion a year.[4] But the broader landscape remains fragmented: legacy systems, inconsistent data standards, and duplicative reporting requirements still impose a disproportionate burden on smaller organisations with limited capacity. For grants teams that make the investment in modern systems proactively, the payoff is significant — better audit trails, earlier risk identification, and more time for the work that matters.
A Stretched Sector, A Higher Bar: What Government Grantmakers Need to Get Right
Government grant-making doesn’t exist in isolation, and the shifts happening across the wider funding landscape have direct implications for how public funders design and deliver their programmes. Foundation grantmaking in the UK hit a record £8.24 billion in 2023–24, with Donor Advised Funds growing 20 per cent to £2.1 billion — but as the Association of Charitable Foundation’s Foundations in Focus 2025 report makes clear, this growth cannot compensate for the long-term decline in government grant-making, and many foundations are now spending above sustainable levels.[5] When philanthropic funders are stretched, the programmes that government funds become even more critical to the organisations that depend on them.
That pressure is visible in application volumes. Foundations are reporting surges of 50–60 per cent above pre-pandemic levels, driven in part by AI tools that have lowered the cost of applying.[5] Government grant schemes are seeing similar dynamics. For public funders, this means more applications to process, more pressure on assessment capacity, and a growing need to ensure that scheme design is clear enough to attract strong applications rather than a flood of speculative ones.
At the same time, the bar for accountability is rising across all sectors. The National Council for Volunteer Organisations Road Ahead 2025 described the year as a “big squeeze” for charities, with statutory funding under pressure and individual giving at its lowest recorded level. [6] In this environment, government grantmakers face a dual expectation: to be efficient stewards of public money and to recognise that for many recipient organisations, a well-designed government grant isn’t just one funding source among many, it is often the one that holds everything else together.
Regional Funding in Transition
The UK Shared Prosperity Fund (UKSPF), which distributed £2.6 billion to local authorities as a domestic replacement for EU structural funds, closes on 31 March 2026. Originally a time-limited programme tied to the previous government’s Levelling Up agenda, it is being replaced under the current government’s broader restructuring of regional funding. Its successors — the Pride in Place Programme and a new Local Growth Fund — are structurally different from what came before, and government grantmakers at every level will need to adapt. [7]
For teams that administered UKSPF locally, the transition raises immediate design questions. Pride in Place is a neighbourhood regeneration programme, not a flexible pot for business support or skills. The Local Growth Fund is channelled through Mayoral Strategic Authorities, which means grantmakers outside those structures will need to rethink how they fund similar priorities with different instruments. The risk isn’t just that funding shrinks — it’s that the grant programmes you run no longer align with the funding available to support them.
This is also a moment to take stock of how schemes are designed. When the funding landscape shifts this significantly, the grantmakers who revisit their own processes — eligibility criteria, reporting requirements, how they coordinate with neighbouring authorities and co-funders — tend to come out of the transition stronger than those who try to run the old playbook on new money.
SOURCES
[1] 360Giving, “£300 billion in grants data shared,” March 2025; “10 years of open grants data,” July 2025.
[2] UKGrantmaking 2025 (June 2025). 360Giving, ACF, ACO, UKCF, London Funders, Pears Foundation.
[4] GOV.UK, “Social Outcomes Partnerships” guidance; Government Outcomes Lab, University of Oxford.
024–25
[3] National Audit Office, “Government’s general grant schemes,” HC 126, 2024–25.
[5] ACF, Foundations in Focus 2025 (December 2025).
[6] NCVO, “The Road Ahead 2025.”
[7] House of Commons Library, “Local growth funds,” CBP-9460, updated March 2026.
