Lord Coaker Hails “Golden Era” as UK Unveils Defence Industrial Strategy

Opening DSEI 2025 in London, UK Minister of State responsible for international relations and defence diplomacy, Lord Vernon Coaker, declared the UK had entered a “golden era of defence spending”, unveiling measures to tie record investment in the armed forces directly to British jobs, regional growth and industrial innovation.

His remarks came against the backdrop of a major export win, with Norway ordering at least five UK-built Type 26 frigates, worth £10 billion and safeguarding thousands of jobs on the Clyde. “A boost for anti-submarine warfare capabilities, a boost for our shared security in the North Sea, and a boost for UK shipbuilding,” Coaker told delegates.

Defence Industrial Strategy

Central to the speech was the government’s new Defence Industrial Strategy, which Coaker described as a “blueprint” for a sector that will not just sell to government but work in full partnership to develop and deliver capabilities. The plan commits to halving procurement timescales, investing in resilient supply chains, and earmarking 10% of procurement spend for novel technologies such as autonomy and directed energy weapons.

The Ministry of Defence (MoD) is also launching an Office for Small Business Growth, raising its SME spending target by 50% to £7.5 billion by 2028. “Our strategy cements a new partnership with industry built on reform, innovation and growth,” Coaker said. “It will ensure the defence dividend is felt by communities through new jobs and rising incomes.”

Growth Deals and Regional Clusters

To spread those benefits nationwide, Coaker unveiled the first five Defence Growth Deals, worth £250 million, aimed at bolstering regional defence ecosystems. Plymouth and South Yorkshire were announced as initial sites, supporting maritime autonomy and high-grade defence materials respectively.

In parallel, a £1.5 million programme will establish new regional defence and security clusters, bringing together primes, SMEs, start-ups and academia to tackle capability challenges and monetise innovations with dual-use potential.

Investment in Skills and Innovation

The government is committing £182 million to defence skills, including five new Defence Technical Excellence Colleges. The Defence and Security Accelerator (DASA) will unveil £1.5 million for innovators developing novel medical technologies, such as advanced methods to stop uncontrolled bleeding. Over £4 billion will be invested in autonomous systems this parliament, alongside nearly £1 billion for directed energy weapons. A £400 million Defence Innovation fund will fuel early-stage research at “wartime speed”, Coaker said.

Industry Milestones at DSEI

Coaker also pointed to major unveilings at the show itself, including:

MBDA’s first public display of the British-led European next-generation stealth cruise missile programme, with work split between Stevenage, Filton and Bolton.

General Dynamics’ Ajax infantry fighting vehicle variant, produced in Merthyr, which has overcome earlier hurdles to become a “prized asset” of the British Army.

The Patria 6x6 armoured vehicle, showcased as part of new multinational collaboration.

The Defence Secretary confirmed the UK will also join the Common Armoured Vehicle Systems Technical Agreement, broadening options for future vehicle development.
Linking security and prosperity

Coaker used the speech to underline the government’s pledge to raise defence spending to 2.6% of GDP by 2027, with a target of 3.5% by 2035, while demanding tangible returns for taxpayers in the form of security and prosperity.

Foreign direct investment in the UK defence sector has topped £1.4 billion since July 2024, creating up to 1,700 jobs. New facilities by Tekever in West Wales and Rheinmetall in Telford were cited as examples of global primes attracted by the UK’s industrial strategy.

“Our armed forces are only as strong as the supply lines and defence industries that stand behind them,” Coaker said. “Together, we can turn UK defence into an industrial superpower by 2035. That’s a win for our security, a win for our prosperity, a win for our values and a win commercially.”