Future focused: Healey speaking with naval personnel in Portsmouth, Britain. The defence secretary wants to grow the country’s military for the first time in a generation. — Reuters
London: As Defence Secretary John Healey talks up his plans to buttress Britain’s military, doubts over funding and Britain’s ability to move fast enough are unsettling the industry and armed forces.
Healey in June laid out a 130-page defence review, billing it as the first in a generation that would transform and grow the British military.
He set out plans to rebuild arms stockpiles, expand Britain’s nuclear deterrent and submarine fleet, and invest more heavily in long-range weapons and advanced technologies such as drones and lasers.
But six months on, with little clarity beyond 2027 on where the money will come from, military chiefs are increasingly concerned the government will need to scale back its ambitions, while authors of the review have called on ministers to redirect money from welfare into defence.
Moreover there’s frustration among manufacturers that they don’t know when certain contracts will be awarded, executives from four different companies told Bloomberg, speaking on condition of anonymity.
One said they needed to be able to show their investors soon that the British government is making good on their commitments, while another said some of its smaller programmes are at risk of being dropped.
The government yesterday unveiled a strategy dubbed “Atlantic Bastion” that’s designed to create a hybrid navy by combining autonomous vessels with warships and aircraft to better protect undersea cables and pipelines, after a 30% increase in Russian ship activity in and around British waters. It will enable Britain to find, track and act against adversaries.
From startups like Arondite Ltd to bigger firms like Anduril Industries Inc, Helsing GmbH, Babcock International Group Plc and BAE Systems Plc, the industry has collectively invested half a billion pounds into developing these technologies for the British market, encouraged by the government’s promise to bolster its defences.
The Defence Ministry said 20 companies have been showcasing their technology through demonstrations with the Royal Navy, with the successful ones being given contracts in the coming weeks to deploy their devices next year.
But that initial investment from the government is only expected to result in £4mil or about US$5.3mil worth of contracts, officials said.
The absence so far of a long-term defence investment plan – which is in the works and will detail how the Defense Ministry will allocate its funding – means the Navy doesn’t know how much more it can invest in the project beyond the next financial year.
The government has vowed to publish the plan by the end of the month.
Britain has slipped behind Germany as the second-biggest European military spender in Nato. And while the government has vowed to ramp up core defence spending to 3.5% of economic output by 2035 from 2.3% last year, it so far has only charted how it will get to 2.6% by 2027.
Meanwhile, Chancellor of the Exchequer Rachel Reeves made scant reference to defence in her budget last month, adding to the concerns of manufacturers and the military.
The Office for Budget Responsibility said the 2035 commitment would cost an additional £32bil in today’s money, describing that as a key future spending risk.
Defence experts have warned that despite the promised increase in spending, it’s not enough to transform Britain’s capabilities due to the need to plug existing funding gaps as well as new capabilities.
George Robertson, author of the defence review and former head of Nato, said last week that more pressure needs to be placed on Reeves to make available the money she promised.
Another author, General Richard Barrons, told an audience at the Royal United Services Institute last month that it’s not “insurmountable” to find billions more from Britain’s public sector envelope, but that the government is “just choosing not to”.
He made reference to Reeves’ move to increase welfare spending by £16bil in her budget, and Labour’s abortive attempts to find savings elsewhere in the benefits budget.
“If we make this welfare offer to ourselves at the expense of security and defence, which is what we’re choosing to do right now, that might be seen historically as an act of self-harm,” Barrons said. “Without a public, national discussion about how we trim the welfare offer we make to ourselves then we can’t liberate the resources for more money on defence.”
Yesterday’s announcement on naval operations comes after the Financial Times reported last month that the armed forces were locked in a row over how best to counter the threat from Russia, with concern that the navy won’t receive sufficient funding in the defence investment plan when it comes, due to the government prioritising rebuilding the army.
Britain announced a new defence pact with Norway last week to form a joint fleet of warships to hunt Russian submarines, but that won’t go live until the next decade, when the new frigates are built.
Head of the navy General Gwyn Jenkins told reporters last week that he’s not happy with the level of availability of Britain’s submarines, and that Britain is locked in competition with Russia to “stay ahead” in their capabilities in the Atlantic.
“I wouldn’t say we’re behind, but I would say we are stretched,” he said.
When asked about the industry’s frustration, Healey told Bloomberg last week that he’s committed to the defence review and is preparing to make “big investment decisions”.
He pointed to the £9bil commitment Britain has made to improve housing for the armed forces over the next decade – part of a big recruitment drive – as well as a joint £100mil investment by government and industry into the DragonFire weapons system. — Bloomberg
