2nd Report - Scotland’s space sector follow-up: launch

The global shortage of launch capacity combined with Scotland’s rapid sectoral growth and increasing international interest presents a time- sensitive opportunity that must not be missed. The Government must realise the massive potential for Scotland’s burgeoning space sector to contribute to the UK’s economic growth and must provide a level of support commensurate with this potential. (Conclusion, Paragraph 36)

Scotland is uniquely well-placed for launch because of its geographical advantage for polar orbits. SaxaVord is poised to provide a long-term sustainable launch capacity for the global market. Some limited UK Government funding and endorsement provided by the UK Government proactively championing the sector has helped unlock the private finance and international visibility needed to enable the sector to reach this point. (Conclusion, Paragraph 37)

However, it is clear that the UK is falling behind its European counterparts in terms of public investment, leaving Scottish spaceports at a competitive disadvantage in a fast-moving global market. Without sustained backing from the Government—particularly in infrastructure—Scotland risks missing a generational opportunity to lead in space launch. To fully realise this potential, the UK Government needs to go further and faster. The Government must move beyond cursory support and commit to long-term coordinated investment that matches the ambition and momentum already demonstrated by the sector. (Conclusion, Paragraph 38)

To ensure the long-term success and competitiveness of launch sites in Scotland’s space sector, we urge the UK Government to incorporate space funding within its broader economic growth ambitions. This must go beyond ad hoc funding and reflect a sustained, strategic commitment—providing the clarity, confidence, and stability that the industry needs to scale capabilities and attract international customers. A clear signal of long-term government support will not only level the playing field with better-funded European counterparts but also position the UK as a serious contender in the global launch sector. (Recommendation, Paragraph 39) 39

The UK Government should examine the case for designating all spaceports as freeports, to spur further growth of the sector and provide a greater opportunity to attract investment, talent and international partnerships. (Recommendation, Paragraph 40)

Scotland has a first mover advantage for achieving Europe’s first orbital launch. However, this early advantage is in danger of being lost, as competitors make rapid progress. If Scotland is to compete, and ultimately succeed, in the race to provide sustainable launch operations, the UK Government must realise that complacency is not an option and do everything it can to strengthen its support for and cooperation with the sector. (Conclusion, Paragraph 49)

There is enough custom for space launch services—both within Europe and globally—to sustain multiple spaceports across the UK and Europe. We therefore do not consider UK spaceports and Andøya to be existential threats to one another, but rather as facilities that can complement each other within a growing European launch sector. We encourage the UK Government to support a diverse spaceport network, whilst also fostering international cooperation to ensure sites like SaxaVord can thrive through regular and consistent launches. (Conclusion, Paragraph 50) National security and geopolitical advantages

There is a clear consensus among stakeholders that the UK must develop and maintain a sovereign launch capability to secure assured access to space. This is critical for national security and defence resilience. Without decisive Government support, the UK risks becoming dangerously dependent on foreign launch partners. This over-reliance could critically undermine the UK’s defence and security infrastructure. (Conclusion, Paragraph 58)

The current geopolitical climate demonstrates the importance of supporting and securing sovereign space capacity—particularly through responsive and defence ready infrastructure—if not, its ability to protect national and European security interests could be severely compromised. (Conclusion, Paragraph 59)

The UK Government should prioritise investment in Scottish-based launch sites in order to reduce dependency on foreign providers. The Government should also diversify launch partnerships and build domestic capacity to avoid being deprioritised by foreign launch providers. (Recommendation, Paragraph 60) 40

The Ministry of Defence must work with the UK Space Agency and Scottish stakeholders to integrate defence priorities into the launch sector. This should include supporting Scottish SMEs in defence-related projects, creating a pipeline of innovation and capability that aligns with the Defence Space Strategy’s goals. (Recommendation, Paragraph 61)

The Ministry of Defence should prioritise the procurement of homegrown responsive launch services from domestic UK providers that can deploy satellites within days or weeks in response to emerging threats. (Recommendation, Paragraph 62)

While Scotland has great potential to be part of a sovereign launch nation and a collaborative European partner, it is increasingly clear that space ambitions cannot be fully fulfilled in isolation. We are pleased to see that space has been included in the 2025 Strategic Defence Review, recognising its growing importance to national security. However, as highlighted in the review and in the evidence we have received, the UK’s long-term space ambitions must be grounded in deepened partnerships. To secure long-term resilience, economic visibility and geopolitical relevance, a cooperative approach must be embraced that aligns with European partners and institutions. (Conclusion, Paragraph 73)

In its response to this report, the UK Government should set out how it is actively pursuing and deepening international partnerships— particularly with European nations and institutions such as the European Space Agency—to ensure resilient and assured access to space. (Recommendation, Paragraph 74)

In response to this report, the UK Government should also set out how it will support companies operating in Scotland in succeeding in the European Launcher Challenge. This should include specific measures on how it will commit to the initiative. The UK Government should write to the Committee to provide an update by Spring 2026. (Recommendation, Paragraph 75) Strengthening the UK Government’s role in space

The UK’s ambition to become a global leader in space, as outlined in the National Space Strategy, is clear—but achieving this vision requires more than ambition. It demands a coherent, long-term investment strategy, stronger alignment with the devolved administrations and funding that supports each area of space innovation—from research and development through to manufacturing and commercialisation. (Conclusion, Paragraph 82) 41

The sector’s prioritisation within the Industrial Strategy, must be underpinned by a long-term and strategic approach to investment in the sector, which is also aligned with the objectives of the National Space Strategy and Defence Space Strategy. Such an approach would provide stakeholders with greater confidence, stability with existing policies and a clearer roadmap for long-term growth. (Recommendation, Paragraph 83)

In its response to this report the UK Government should commit to producing a clear plan—including timescales and funding mechanisms—for broadening its space sector support beyond research and development. This should include targeted investment in manufacturing, productisation, and commercialisation. Funding in these areas will enable UK-based launch and manufacturing companies—particularly Scottish providers—to scale from development phases to full operational capability, which is essential to establish the sector’s readiness and reinforce the UK’s position as a leader in the space economy. (Recommendation, Paragraph 84)

The UK Government must realise the value of becoming a long-term, sustainable customer of ‘home grown’ space capabilities. Once Scotland has a proven sovereign launch capability, the provision of Government support as an ‘anchor customer’ of domestic services, rather than as a provider of one-off financial grants, will be key to ensuring the long-term financial viability of launch providers and stimulating Scotland’s wider space sector. This will require coordination, demand aggregation and a clear investment strategy from the UK Government. Scotland’s launch sector is a key asset, but it must be supported through strong strategic inclusion and targeted funding mechanisms. Without this, Scotland risks falling behind better-prepared competitors and missing an opportunity to build a high- growth space economy. (Conclusion, Paragraph 91)

The UK Space Agency should therefore commit to working with both the UK and Scottish Governments to identify early public sector customers for Scotland’s launch and spaceport sector. Government becoming a customer of the Scottish launch sector would send a clear demand signal that the sector is viable and encourage the development of a more diverse customer base in the coming years. We also call on the Department for Business and Trade to explain within six months, either in a written ministerial statement or in writing to the Committee, how it will promote international demand for Scottish launch services. Similarly, given Scotland’s competitive geographic location and capabilities, we urge the Scotland Office to play an active role in realising the ambition for Scotland to be a global leader in small satellite launch. (Recommendation, Paragraph 92)

Responsibility for space policy and regulation is currently spread across multiple government departments, which leads to unclear roles. Companies within the sector are having to coordinate with multiple government 42 departments, often with limited communication or coordination between them. This is unnecessarily hindering progress within the sector. Despite the UK’s ambition to lead in launch, the lack of clearly defined roles in and around government seems a significant barrier to growth. While the Government has acknowledged this challenge and committed to a cross- governmental approach through the implementation of the Strategic Defence Review’s recommendation, urgent action is needed to turn this commitment into well-coordinated governance. A more streamlined and clearer structure is essential to provide industry the clarity and confidence it needs to excel. (Conclusion, Paragraph 102)

We therefore cautiously welcome the Government’s decision to take direct control of the UK Space Agency, which signals a clear intent to strengthen coordination across Government, to support the sector’s development. If implemented well, this move could be a step in the right direction towards reducing bureaucracy and streamlining the sector’s experience of interacting with Government. However, the Department will need to ensure the change does not result in any loss of autonomy, proactivity or agility for the Agency. We hope to see this centralised oversight drive greater strategic alignment of policy and investment for the UK’s space sector. (Conclusion, Paragraph 103)

Nonetheless, enhanced cross-departmental collaboration will still be needed to ensure the UK’s space sector operates under a coherent and unified direction. In its response to this report, the UK Government should set out the structure, membership, and remit of the Cabinet sub-committee for space, and confirm when it will hold its first meeting. The UK Government should also commit to publishing the sub-committee’s minutes—including attendance and frequency of meetings. The Government should update the House on the sub-committee’s progress at regular intervals, through a written ministerial statement. (Recommendation, Paragraph 104)

While we are sympathetic to the sector’s calls for a dedicated ‘Minister for Space’, we do not believe such a role is necessary at this time. Fundamentally, the sector’s calls reflect a desire for improved engagement with the sector, and a more coordinated, joined-up approach between Government departments. Rather than establishing a new ministerial post, the Government should focus on ensuring this Cabinet sub-committee for space delivers meaningful improvements in coordination and engagement. In its response to this report, we expect the Government to set out what progress has been made on establishing this sub-committee and what contribution it has made to the Government’s work in this area. (Recommendation, Paragraph 107) 43