Defence Industries: North-East

Alan Strickland Excerpts

Tuesday 13th May 2025 Westminster Hall

[Luke Myer]

I thank my hon. Friend for that intervention. By boosting SMEs we boost not only the defence industry, but other sectors, because many of these SMEs are working on dual-use technology, which has a strong crossover with other areas.

Ultimately, growing our sovereign capacity by building more in Britain is a smart and strategic move that will pay off in the long run, both for our national security and our economic growth.

[Alan Strickland (Newton Aycliffe and Spennymoor) (Lab)]

I commend my hon. Friend for this excellent debate and the Minister for the leadership that she is showing—I was grateful for her recent visit to NETPark in Sedgefield in my constituency. Does my hon. Friend agree that there is another significant benefit of more work going to SMEs? Warfare is changing at such a rapid pace that we need to take hold of innovation and the innovative products being delivered by our SME community in Sedgefield and around the country, so that we are battle-ready for the future.

[Luke Myer]

Absolutely. One of those innovative projects in my hon. Friend’s constituency is a semiconductor plant, which the Government stepped up to save with £20 million of investment. That is exactly the kind of active Government and leadership that we need.

The previous Government set up procurement processes with a singular focus, which was awarding contracts to the lowest bidder. That may seem sensible on the surface, but in fact, it has stifled British growth and ultimately cost the taxpayer more. To give an example from Middlesbrough, a local company was forced to step in and finish works that were initially being done by a contractor in south-east Asia, which had been chosen purely because it was the cheapest at the time. Time and time again, we have seen Conservative Governments make decisions on industrial policy that erode our manufacturing base, see jobs disappear overseas and weaken British industry. That Middlesbrough business was there to pick up the pieces and finish the job, but the delay was wholly unnecessary. It ended up costing the British taxpayer more than if we had simply built in Britain from the start.

We need an approach that prioritises British values over mere price. This is about not just securing the cheapest deal but ensuring that every pound we spend strengthens our national security. We must grow our sovereign capacity and put British business first, and support our local economies in the process.

It is also time that we took a more intelligent and long-term approach to defence procurement—one that does not cost us more and builds the kind of capacity that we need here at home, especially in the current global climate. For industries to invest and grow, and train apprentices and support communities, we need to move away from short-term projects and annualised budgets. Businesses need long-term clarity. That will give them stability to plan for the future with confidence.

One SME I spoke to feels that the industrial strategy will help with that, but we can do more to give further confidence to the supply chain, especially through rapid and clear decisions on projects and support for the up-front capital investments that they need to make. This is about investment not only in specialised equipment, but in people. In our region, the jobs in this industry are high-skilled, well-paid and secure, and many of the manufacturers invest strongly in skills and apprentices.