Defence, Security and Resilience Bank

Baroness Kramer Excerpts

Tuesday 19th May 2026 Lords Chamber

[Lord Livermore (Lab)]

The scale and precise focus of the mechanism remain to be determined, but the scope of those activities would include lending to sovereigns and to the sector and providing loans to supply chains and loans for capacity expansion. We anticipate that it will make a material contribution to defence spending and investment across those involved. The intention is that this mechanism will be established as an independent international financial institution underpinned by an international agreement and with sovereign countries as members in the first instance. As with other international financial institutions, paid-in capital will be expected to leverage in private sector funding by a multiple of that initial contribution.

[Baroness Kramer (LD)]

My Lords, I am now completely bewildered. I would have thought that, with the state of the gilts market, the Government would be leaping at the opportunity to find AAA financing for their defence expenditure, and on a multilateral basis. Are we dealing with the underlying problem of a Treasury that basically says, “not invented here”, rather than looking at an opportunity that has been virtually handed to it?

[Lord Livermore (Lab)]

No, and I do not quite understand why the noble Baroness is confused, because we are doing exactly what she says. We are setting up—or being part of—a proposed multilateral defence mechanism. I thought the noble Baroness would share a similar worldview in terms of wanting to see greater amounts of co-operation and procurement among a core group of EU allies and NATO allies and partners. What she is asking for is exactly what the Government are exploring.