Defence Industries: West Midlands

Jim Shannon Excerpts

Wednesday 19th March 2025 Westminster Hall

[Sarah Edwards]

I absolutely agree. This industrial strategy is essential in making sure we have the focus to support our businesses right across the region, and in making sure that they are successful.

The upcoming defence industrial strategy must prioritise British businesses, including SMEs, ensuring that investment creates jobs and strengthens our national security. Currently, nearly 18,000 people work in defence SMEs in the west midlands, and the Ministry of Defence spends £1.6 billion annually in the region, making it the UK’s third largest defence hub. By backing UK industry, and fostering co-operation between Government, business and workers, we can build a defence sector fit for the future.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Lady for bringing this issue forward, and she is certainly making a reputation for herself as an assiduous MP on these issues. I welcome what she said in relation to the Government’s commitment to 2.5% increasing to 3%—there is nobody in the United Kingdom who does not welcome that. I know that we in Northern Ireland have very strong sectors in the work we do with the Royal Navy and Thales, but does the hon. Lady agree that we must ensure that all parts of the United Kingdom can get the advantages that she has referred to, in terms of not just security, but the economy, jobs and opportunities? If we can all be part of this process going forward, that could support the Minister and the Labour Government.

[Sarah Edwards]

I absolutely agree with the hon. Member. In fact I will go on to talk about just how important it is that all our regions and nations are embedded in this process, and that they all contribute different skills that are of value. There are so many different aspects to defence, and our defence industries that contribute and go well past into other areas of manufacturing. I thank him for raising that point.

Last week, the Business and Trade Committee heard from Rolls-Royce, BAE Systems, Leonardo and MBDA on the global combat air programme, which is an alliance between the UK, Italy and Japan, who are designing Tempest fighter jets. That alliance integrates advanced air combat technology, ensuring that our defence capabilities match evolving threats. Defence alliances are a cornerstone of trade diplomacy, driving both national security and industrial growth. They have been cited as having the potential to drive our export growth, while cementing important alliances for our defence.

One issue raised with the Business and Trade Committee was the short-term nature of defence funding cycles; even major companies operate on a one-year funding cycle, making it difficult to sustain long-term projects such as Tempest. National security priorities do not fit neatly into parliamentary terms, and our defence sector needs stability. It was suggested that moving to a three or five-year funding model would provide certainty, drive innovation and ensure that the UK remains a global leader in defence. What conversations is the Minister having on the contractual arrangements currently in play for companies and the assessment that he has made of their ability to help the Government to reach their goals for the sector and national security?

Export-led growth will be essential to the defence industries that need a wider base than just their own sovereign purchasing power. By exporting technology and products, companies will be able to keep the continuity of build programmes going away from that boom-and-bust cycle. We could use industry to foster diplomatic relations of bilateral importance. The future of the defence industry relies on a workforce equipped with the right skills and adaptable to the evolving demands of our armed forces and the Ministry of Defence.