Ambitious targets set to build ships and weapons faster for Royal Navy, Army and RAF in "engine for growth"

The government has published further plans to bolster the Royal Navy, Army and RAF, as part of an “engine for growth” package. Labour politician John Healey announced the initiative and is set to become the first defence secretary to close the London stock exchange today (May 13).

He said: “The war in Ukraine confronts us with the truth that a military is only as strong as the industry which stands behind it. I’m here today – at this most crucial time – to help forge a new partnership between industry, innovators and investors. UK Defence is open for business and together we can make Britain secure at home and strong abroad. National security is at the heart of our Plan for Change, and is essential for economic security, investor confidence and social stability.”

Talks have already been held between Royal Navy personnel, key figures of defence firms and MPs in Portsmouth to discuss ways of supporting businesses and securing high-skilled jobs. The government has already pledged to prioritise British firms for government contracts, with a recent report from the Ministry of Defence (MoD) showing that small and medium-sized businesses funded by them attracted nearly £600m in private equity investment.

The package of measures contains four major commitments, the first of which being a procurement reform. Targets to produce major capabilities - including planes, tanks and ships - will be reduced from dix years to two years for the contract to be awarded. Planned timescales for upgrades made to weapons and communications systems will go from an average of three years to roughly 12 months, with purchases of drones and similar software being ran in three-month cycles.

Enterprise agreements have been made with software, data and AI suppliers, with the MoD securing deals with Adarga, Haedean, Oxford Dynamics and WhiteSpace - worth up to £50m. A new innovation organisation, UK Defence Innovation, will be set up in July to develop new cutting-edge technology for the armed forces. it will have a ring-fenced budget of £400m this financial year. Various projects are currently underway to bolster the Royal Navy, with new Type 26 and 31 vessels being constructed.

The final part of the package is the establishment of a defence industrial joint council, which is hoped to help boost investment and deliver new jobs. Daniel Maguire, group head for the London Stock Exchange Group said: “The defence industry plays a vital role in the wider UK economy, supporting jobs and creating long-term value alongside ensuring our national security. We welcome the government’s new measures and hope that LSEG can support in initiatives designed to help unlock capital for companies, boost growth, and promote innovation.”