Continuing ADS’s blog series on the Defence and Security Industrial Strategy (DSIS), we will be looking this week at how the rise of novel technologies such as quantum computing and artificial intelligence should force the UK to reassess what capabilities it needs to stay safe and prosperous, now and in the future. For businesses to develop the technologies of tomorrow to meet that challenge they need to be able to plan and this requires financial certainty, a clear understanding of the UK’s critical national security requirements and tailored partnering with key sectors.

Defence and security companies require long-term financial stability in order to confidently make investment decisions. Due to the nature of the UK’s budgetary arrangements public funding is currently provided in bursts, typically on an annual basis. This is neither stable nor consistent, resulting in unpredictable funding that hinders industry’s ability to meet national security requirements efficiently. Early and consistent funding, alongside clarity on future requirements, can help to leverage additional investment from our sectors, both in innovative technologies and the future workforce. For that reason, ADS believes that the DSIS should be the start of a discussion about introducing multi-year budgets.

Consistency and predictability of funding must be accompanied by greater trust between the Government and industry. If industry has more clarity about the UK’s future national security requirements then this also will boost their investment, particularly on R&D. However, our sectors recognise that discussions on future requirements, particularly on those deemed to be nationally vital (sometimes described as Sovereign Capability), are deeply sensitive. Respecting the need for secrecy, our sectors would welcome guidance and direction from the Government on which technology areas are deemed to be Sovereign Capabilities. This will then enable our member companies to make long-term decisions to support the UK’s national security and prosperity.

The DSIS offers a chance for the Government to work in new ways with industry to deal with the technological challenges of tomorrow. In some areas there may also be scope to develop capability-specific approaches, which encourage long-term partnering with industry. These should pay heed to successes such as the National Shipbuilding Strategy and the Combat Air Strategy, which have provided industry with useful direction as to the Government’s priorities and overarching goals. The DSIS should explore whether there are other areas of UK capability that may benefit from similar ‘sector strategies’, such as land and rotorcraft, if it helps to increase inward investment to the UK and leads to the long-term sustainment of onshore national capabilities.

At the heart of our recommendations above is trust and clarity. If the DSIS can succeed in building up trust between the two sides and giving industry greater clarity on the Government’s long-term priorities, then the UK will be well placed to remain a global leader in the years to come.

Please check back next Wednesday (22nd April) for our next update. To read the other blogs in this series please see below: