Space · Security · Economy
Space investment and security
RAND Europe’s evaluation for the UK Space Agency found substantial benefits from UK investment in European Space Agency programmes, while separate research examined the growing risks to stability in space.
From the chapter “Navigating the evolving landscape of space” · Report pp. 8–11

A ‘second space race’
Governments, militaries and commercial actors are expanding their activities in space, which now underpin communications, navigation, surveillance and data exchange. RAND experts describe this environment as a ‘second space race’, characterised by both immense opportunity and emerging risk. For Europe, the report argues, engagement in space is essential to economic prosperity, defence and security, technological leadership and the modern way of life.
During the year, the RAND Europe Space Hub (RESH) undertook a range of UK- and EU-funded studies on space policy, security, technology, and innovation and industry programmes.
Evaluating UK investment in ESA
The UK has been a member of the European Space Agency (ESA) since its founding in 1975. The partnership, managed by the UK Space Agency (UKSA), accounts for around 70–75 per cent of the Agency’s annual budget. With the UK aiming to secure a 10 per cent share of the global space market, RAND Europe experts identified a crucial window of opportunity for the country to exploit its potential in space.
Commissioned by UKSA, researchers from RAND Europe’s Science and Emerging Technology team found that UK investment in ESA offers substantial benefits in capability development, international influence and economic return. ESA contracts were found to generate significant and sustained gains for UK firms, boosting turnover, employment, productivity and private research and development investment. The research also highlighted how long-standing engagement with ESA has enabled UK organisations to develop world-leading technologies, facilities and mission leadership – including contributions to lunar and planetary exploration and the Lunar Pathfinder project.
The researchers concluded that very few of these benefits would be achievable outside ESA, and that UKSA acts as a vital bridge between policy and industry.
Space security and governance
Separately, RAND Europe’s Defence, Security and Justice team analysed space governance and security, with a focus on hybrid threats in outer space and the potentially destabilising effects of new space and counter-space technologies. This includes a three-year project on the implications for strategic stability of dual-use space systems – those with civil, commercial and possible military applications, which bring ambiguity about their intended use.
Working with RAND colleagues in the US, the team is delivering Track 1.5 dialogues with experts and government or military stakeholders from Europe, the Americas and the Indo-Pacific. RAND Europe also published a social network analysis mapping the growing complexity of space actors. The report describes strengthening space governance as a collective-action challenge that demands multilateral cooperation at a time of increased tension.
“RAND Europe’s evaluation found that the UK space sector gains £7.49 for every £1 invested into ESA. This finding has been quoted widely by UK government officials, and our recent evidence submission was cited 28 times by the House of Lords UK Engagement with Space Committee.”
Key findings and implications
- UK investment in ESA offers substantial benefits in capability development, international influence and economic return.
- ESA contracts generate significant and sustained economic gains for UK firms, including higher turnover, employment, productivity and private R&D investment.
- Very few of these benefits would be achievable outside ESA, according to the researchers.
- Recommendation: the UK should adopt a unified, long-term strategy aligning government, industry and academia, with greater cross-government coordination and sustained investment.
- Strengthening space governance is a collective-action challenge requiring multilateral cooperation.
Documented in the report
Research in action
The report states that many of RAND Europe’s recommendations were echoed in a subsequent parliamentary report on the future of the UK space sector, to which RESH contributed written and oral evidence. RESH members also gave expert testimony at multiple UK parliamentary inquiries and spoke at the United Nations in Geneva during the year.
Source
RAND Europe, Spotlight 2025–2026 (CP-A1150-6), printed pp. 8–11 (PDF pages 10–13). Text adapted for the web; quotations reproduced as published. Statements reflect the period of publication.
Image credits: Illustration: Dàlia Adillon (printed p. 8).
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