Rachel's gone on a £4TRILLION spending spree... so here's how to make sure it gives your investments a turbo boost: These are some of the firms that will win big - and how to invest in them

After the blowout comes the debt hangover – and economic experts expect us all to end up with sore heads and wallets after Rachel Reeve’s Spending Review last week.

But while we wait to see which of our taxes she’ll raise in the autumn Budget to pay for it all, we can help ourselves by investing in some of the companies that will reap the benefits from her largesse.

The Chancellor has said she would hand billions of pounds to the departments responsible for affordable housing, defence, healthcare, nuclear power and transport, and that money in turn will be handed to the companies that build, maintain and provide the services she’s paid for.

In all, she laid out plans to ‘invest’ £4 trillion to fund ‘the renewal of Britain’.

It’s possible to identify many of the big winners from Ms Reeves’s handouts before the contracts have even been awarded, and to invest in them either directly or through funds or investment trusts.

Here are some of the top beneficiaries, and how you can take advantage of the cash headed their way.

As global turmoil continues, the defence sector gets a boost of £14billion in the Spending Review. By 2027, 2.5 per cent of our national income will be spent on the technology, weaponry and manpower needed to keep our shores safe, and the Government has made a further promise to get it to 3 per cent of GDP at an unspecified date next parliament.

That means a boost to the businesses that make, provide and service weapons of war – some of which will be spent close to home.

Who will benefit? £4.5 billion of munitions will be made in British factories, benefiting the firms that make them, while the Defence Estate Optimisation programme – a huge ongoing programme to upgrade UK defence infrastructure, gets a boost from the 7.3 per cent rise in the capital budget. That benefits the companies already handling this programme, and those waiting for contracts from it.

How can I get exposure? If you want to buy into defence directly, much of the munitions munificence is staying close to home.

Listed aerospace company BAE Systems owns the weapons factories that will ramp up production to meet new targets; BAE, along with Rolls-Royce, will also be involved in the delivery of new submarines; and Babcock, which services and maintains the submarine fleet, will also get a boost.

But most defence companies are already riding very high. Babcock shares are up 108 per cent this year and BAE’s up 68 per cent.

Another option is to buy into listed companies Kier, Galliford Try and Morgan Sindall – infrastructure names that are all involved in delivering the Defence Estate Optimisation programme, as well as in some of the other infrastructure projects the Chancellor announced.

Analyst Joe Brent, at Panmure Liberum, reckons Kier is a winner from the defence spending as well as the Chancellor’s healthcare boost. The shares are up 19.4 per cent this year, but are not as stratospherically high as BAE.

If you’d rather invest via a fund to get more diversified defence exposure, there’s now a popular defence exchange traded fund from WisdomTree that tracks the performance of a basket of defence stocks. It’s only been around since March and is already up 18 per cent.

For something more diversified, James Carthew, co-founder of investment trust researcher QuotedData, suggests Global Opportunities Trust, which he says ‘has long had a much larger exposure to the defence sector than its peers’.

The trust’s top-ten holdings include French military plane manufacturer Dassault, as well as UK security business Qinetiq, but its top holding is the Japan Special Situations Fund and the trust gives exposure to both Japan and Europe. It trades on a 1 per cent discount to net asset value.

NUCLEAR ENERGY AND GREEN ENERGY

One of the Government’s spending pledges was to build the new Sizewell C nuclear plant in Suffolk, while there are also plans to build small nuclear reactors as Energy Secretary Ed Miliband announced a ‘golden age for nuclear’.

Excluding Sizewell, the Department of Energy Security and Net Zero will see its annual capital budget rise by 2.6 per cent in real terms by 2030. That means more investment in carbon capture and battery storage, as well as other green initiatives.

Who will benefit? Building Sizewell will involve 10,000 jobs and a £14 billion investment, with key infrastructure companies based in the UK expected to benefit. Clean energy experts will also win from the increased spending.

How can I get exposure? Sizewell will be part-owned by French company EDF and part by the UK government, but plenty of UK-listed businesses will be involved in its build.

It’s ‘a particularly large opportunity’ for Balfour Beatty, according to Joe Brent, at Panmure Liberum. The construction company’s shares are up 8.6 per cent this year and it is also benefiting from other government infrastructure projects.

If you want to find a possible bargain though, steel contractor Severfield is also heavily exposed to this sector, Brent says. It’s down 30 per cent this year thanks to tariff uncertainty and a profit warning but could benefit from government contracts.

For those wanting to buy funds, rather than shares, Darius McDermott, managing director at fund expert FundCalibre, recommends VT Gravis Clean Energy Income, which has no nuclear exposure but plays to the green energy infrastructure theme.

Nine in ten pounds of the real day-to-day increase in public spending will go to the health sector, according to Paul Johnson, at the Institute for Fiscal Studies. This means that between 2000 and 2028 healthcare will have moved from taking up a quarter of spending to 40 per cent of it.

Who will benefit? As well as day-to-day funding for the NHS itself, there is money for capital spending.

The Government is committed to delivering 25 new hospitals and spending £30billion on maintenance of the NHS estate, with more than £5 billion allocated to address critical building repairs. Those building hospitals and other health infrastructure will do well.

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Plus, as the Government tries to bring down waiting lists there is scope for more use of partnerships with the private sector.

How can I get exposure? Private healthcare in the UK is already booming, with figures from the Private Healthcare Information Network last week revealing that there were more private hospital admissions in the UK in 2024 than in any year on record. New NHS funding won’t reduce that figure and private healthcare is predicted to keep seeing patient numbers rise.

Spire Healthcare is the UK’s biggest private healthcare provider. It’s been hit with a profit warning over costs in March, and shares are down 8.6 per cent this year. Sebastian Jantet, at Panmure Liberum, reckons it is undervalued at this level.

Those wanting a fund could consider a Real Estate Investment Trust with a healthcare slant such as INPP and HICL, which both invest in building clinics and hospitals.

Joe Holland, Investment Manager at Tyndall Private Clients, says these trusts trade at large discounts – where the value of the underlying assets is not fully reflected in the share price, but that additional spending at this point is ‘expected to rekindle interest’.

HICL trades at an 27 per cent discount to the value of its assets and INPP at a 16 per cent discount.

Funding for affordable homes was confirmed at £39billion over ten years, almost doubling annual funding.

Who will benefit? Darius McDermott, at FundCalibre, says the plan will benefit ‘housebuilders, modular construction firms, and property services companies aligned with affordable housing’.

How can I get exposure? Buying into the housebuilders themselves is the simplest way to gain exposure, though it is risky to put all of your eggs into one basket.

Ozge Brinkworth, equity analyst at Rathbones, suggests Vistry is the basket to pick, as it has the ‘largest exposure to affordable housing’.

The company has suffered from cost overruns and issued profit warnings, and shares are down 46 per cent in a calendar year but up 18 per cent in the year to date as the market wakes up to the opportunity for Vistry around affordable housing.

Another possibility is Eneraqua, which plays to the affordable housing theme as well as a number of other Spending Review priorities.

The company helps companies and individuals decarbonise their properties and save water. Clients include local councils such as Camden, Leeds, and Kensington & Chelsea, as well as hospital trusts and school builders.

Fund fans should consider Aurora UK Alpha, an investment trust with the largest number of housebuilders for those who would rather have a spread.

It has Bellway and Barratt Redrow in its top holdings, but is tightly concentrated in general so is a riskier ploy than a trust with a larger spread.

Joe Brent, at Panmure Liberum, says transport was a ‘clear winner’ from the Spending Review after a series of disappointments for the Department for Transport in last autumn’s Budget with projects being cancelled.

New money includes £15.6billion for regional transport and a green light for the rail line between Liverpool and Manchester. The Government continues to support a third runway at Heathrow.

Who will benefit? Infrastructure companies that run big transport projects, many of which are UK listed, will do well from transport spending.

Some of them lost out when other projects cancelled recently, so spending in these areas will be welcome news for the likes of Balfour Beatty, Kier, Galliford and Costain.

How can I get exposure? Buying these individual companies gives you access to several Spending Review priorities as Balfour and Kier, in particular, will also benefit from energy spending, says Joe Holland, Investment Manager at Tyndall Private Clients. Funds in this sector include Shires Income, run by Aberdeen, which includes both Balfour and Kier in its holdings. The fund is up 13 per cent this year.