Companies that import critical minerals into Britain for use by manufacturers will be able to obtain financing for the first time from UK Export Finance, chancellor of the exchequer Rachel Reeves announced in the Budget today. 

"UK Export Finance (UKEF) will now be able to provide financial support to UK companies supplying critical minerals to UK exporters in high-growth sectors such as EV battery production, clean growth, aerospace, and defence, furthering the government's Net Zero ambitions and building supply chain resilience," the Budget read.

"This new support targets projects that secure critical minerals from overseas and will boost supply chain resilience in key manufacturing sectors."

Elsewhere, the government said it will publish a Trade Strategy in 2025.

"The fact the government recognises the importance of critical minerals is of course welcome. Its announcement is in line with US and some other western policies of seeking to boost supply chain independence and resilience."

"The devil as always is in the detail – we are yet to see the precise form of the financial support, the amounts available and who precisely will be eligible, and for what. It's at that point that the industry will be better able to assess the impact," Greg Mulley, partner and head of Herbert Smith Freehills' mining practice in UK and EMEA, told Mining Journal.

"As with any incentives, they cannot be looked at in isolation. The government will need to ensure that we have a healthy and attractive environment in the UK more broadly for investors, and assess how other regimes (e.g., the EU Critical Raw Minerals Act) may impact the UK's ability to export," Mulley added.

The UK government said that its Trade Strategy "will renew the UK's commitment to free and open trade, support the government's Industrial Strategy and Net Zero ambitions, and enhance economic security."

"To support this strategy, the government will work with the European Union to identify areas where we can strengthen cooperation for mutual benefit, including the economy, energy, security, and resilience," the Budget said.

Previously, the UK has been accused of being behind its peers in the race to secure critical minerals supply chains. 

"Most mining projects are struggling with early stage financing, which is before offtake contracts are negotiated," Andy Leyland, managing director of SC Insights, a battery materials consultancy, told Mining Journal.

"While industry will appreciate all financing avenues made available, the key is to advance financing, or conditional offers thereof, at an earlier stage than the Chinese will," he added.

"This is especially the case with World Class projects who can operate in the first quartile of production costs."

EVs

Reeves also said she wants to support the take-up of electric vehicles.

"I will maintain the incentives for electric vehicle tax from 2028 and increase the differential between fully electric and other vehicles in the first year, rates of vehicle excise duty from April 2025; these measures will raise around £400 million by the end of the forecast," Reeves said in Parliament.

"The transition to electric vehicles (EVs) is crucial to decarbonising transport and will support growth and productivity across the UK," the Budget reads. "There are now more than 1 million electric cars on our roads. The government has committed to phasing out new cars that rely solely on internal combustion engines by 2030 and that from 2035 all new cars and vans sold in the UK will be zero emission."

The government will invest over £200 million in 2025-26 to accelerate EV charge point rollout, including funding to support local authorities to install on-street charge points across England, the Budget says. It will also provide £120 million in 2025-26 to support the purchase of new electric vans via the plug-in vehicle grant and to support the manufacture of wheelchair accessible EVs.

Technology 

This year during Mining Indaba, DEScycle, which is a UK-based company seeking to advance its metal recycling technology, told Mining Journal that the UK is not fit for purpose for technology companies wanting to disrupt the mining space. 

DEScycle is a deep technology company developing what it calls Deep Eutectic Solvents (DES), which it says replaces the smelting process. It also champions e-waste recycling, replacing carbon-intensive smelters.  

As part of its growth strategy, DEScycle is developing mineral processing applications in nickel and cobalt. The company received a £1 million grant from the UK Government to develop its early-stage R&D but has found that when it comes to advancing the technology towards commercialisation, the support hasn't been there. 

Similarly, earlier this year chief executive of Cornish Lithium, Jeremy Wrathall, told Mining Journal that the UK is playing catch-up in critical minerals policy.

"We want the government to continue to be proactive and engaging with critical minerals because they are the key to our transition to renewable energy and our whole economy," Wrathall said. 

Tata Steel

The government also confirmed £80 million of funding for the Port Talbot Transition Board, with work already underway to support workers and businesses affected by decarbonisation at Tata Steel.

In September, the UK Government pledged £500 million in funding for Tata Steel's Port Talbot.

"To support the transformation of UK steel production, the government has agreed an improved deal with Tata Steel, including £500 million in grant support. The Budget confirms the funding required in 2024-25 and 2025-26," the Budget read.

"This will unlock investment in an electric arc furnace, deliver a 1.5% reduction in the UK's total greenhouse gas emissions and secure around 5,000 steel jobs across the UK, alongside ensuring workers have enhanced support during the transition period," it said.

This is the same amount the previous government promised bosses to keep production at the site, but pivot towards greener energy. However, this is very much being paraded as a new deal for the plant. It will go towards the cost of building the electric arc furnace in Port Talbot.

The UK government said it has new assurances from Tata Steel that it will avoid compulsory redundancies wherever possible and channel their efforts instead into job matching and retraining so that the steelworkers of Port Talbot "can now help shape its future."

Arc furnaces are set to replace the traditional blast furnaces at the Port Talbot steelworks, but they require thousands fewer staff.