The UK's House of Lords UK Engagement with Space Committee has published a scathing report, "The Space Economy: Act Now or Lose Out," declaring that the 2021 National Space Strategy has "failed to turn its ambitions into reality."

The verdict is blunt: "The UK space sector lacks the strategic direction necessary for success."

Brit scientists over the Moon after growing tea in lunar soil [1]READ MORE

The space sector contributes £18.6 billion to the UK economy, employs approximately 55,000 people and has enviable technological prowess when it comes to building satellites and payloads. The industry is more than twice as productive as the UK average and currently accounts for between 4.3 percent and 6.1 percent of the global space economy. But the latest figures reveal an 8.9 percent contraction between 2021/22 and 2022/23."

Part of the problem stems from Brexit as the UK no longer has a formal say in the EU space program. The report highlights the country's exclusion from ESA's Copernicus project until 2024 and access to European markets becoming more "complex and burdensome".

It adds: "the UK's ability to influence the direction of ESA and maximise the benefits of its programmes may be fundamentally altered should ESA become more heavily influenced by EU policymaking."

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Another problem? Responsibility for space is scattered across government. Defense falls under the Ministry of Defence, trade under the Department for Business and Trade, launch regulation under Transport — while the UK Space Agency faces absorption into the Department for Science, Innovation and Technology. The report recommends creating a dedicated Space Minister to coordinate efforts.

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The commitee also calls for a shift in funding from research grants (aimed at nurturing research and development), to procurement-based funding that can "crowd in private investment and strengthen national capabilities."

Like many other countries, the UK depends heavily on SpaceX. Falcon 9 dominates launch services and Starlink leads in satellite broadband. This worries the committee, particularly given "increased demand for SpaceX launch services and the potential politicisation of the Starlink service."

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Although there's no immediate threat to access, the report urges the government to "ensure access to diversified and/or sovereign services where possible" and research the potential impacts of losing SpaceX access.

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Broader concerns exist about US reliability. The UK military's space relationship with the US remains strong, but civilian ties with NASA face "great uncertainty given recent shifts in US policy."

Dr Bleddyn Bowen, Associate Professor of Astropolitics at the School of Government and International Affairs (SGIA) at Durham University, told the committee that "given the events and the discourse of the past five or six months, my faith in the United States has been shaken."

The UK is the only country to have developed an orbital-class rocket and then cancelled it. The report notes: "the business case for a UK-based launcher and UK-based spaceports has not been fully proven, and that economic viability should be considered."

The security argument is compelling, it adds. "A sovereign launch capacity would strengthen national security, underpin the growth of the UK’s space and satellite industries, and ensure that Britain remains a trusted and resilient partner within the allied space operations."

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UK-based launch vehicle maker Skyrora, which has yet to make its first orbital launch, [12]said the report "makes clear that sovereign launch is not a luxury, it is a strategic necessity" and that "the UK must reassert its sovereign capability to access orbit."

Dr Bowen [13]observed , "The 'Act Now or Lose Out' title is quite apt as most other major and developing economies are making significant investments in space, both civil and especially military. All on top of a more febrile geopolitical environment where old dependencies and relationships have to be re-examined."

The report's warning is stark: "Only the most forward-looking and strategic states will be able to reap the benefits of the expanding and changing space economy — those who do not adapt will be left behind.

"The UK must act now if it wishes to be a leader in the growing space economy, the new race for space." ®

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[1] https://www.theregister.com/2025/09/22/moon_tea/

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[6] https://www.theregister.com/2025/11/03/esa_launches_study_phase_of/

[7] https://www.theregister.com/2025/10/31/spacex_shows_off_lunar_starship/

[8] https://www.theregister.com/2025/10/29/nded/

[9] https://www.theregister.com/2025/10/14/more_jpl_employees_set_to/

[10] https://www.theregister.com/2025/10/11/deep_future_fund/

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[12] https://skyrora.com/realising-uk-sovereign-assured-responsive-launch-through-skyrora-and-mod-led-space-capability-procurement/

[13] https://bsky.app/profile/bleddb.bsky.social/post/3m4sax5jvoc2f

[14] https://whitepapers.theregister.com/