Ministers Set Out Golden Age Vision for UK Defence Industry at Farnborough International Airshow

Homeland July 23, 2026

The Defence and Security Accelerator (DASA) is pleased to launch a new Themed Competition called AWE – Advanced Electronics and Electromechanical Devices.

Lord Coaker and Minister for Defence Readiness and Industry Luke Pollard used keynote speeches at Farnborough to deliver the clearest ministerial signal yet that SMEs and the wider supply chain are central to the UK’s defence ambitions – backed by record investment, structural reform and a new SME Action Plan.

Two senior defence ministers used the platform of Farnborough International Airshow to deliver a coordinated and unambiguous message to UK industry: the defence supply chain is no longer a peripheral consideration but a strategic priority, and the investment, structures and reform programmes to back that ambition are now in place.

Speaking at the Enterprise Gateway, Lord Coaker framed the moment in stark terms. The government, he said, inherited a defence programme that needed more investment, a procurement system that was not quick enough, and a supply chain that was suffering – with smaller businesses struggling to navigate and access a sector still investing in technologies designed for an older era of warfare. That was two years ago. The publication of the Strategic Defence Review, Defence Industrial Strategy, Defence Diplomacy Strategy and Defence Investment Plan has since set out a fundamentally different vision – one in which industrial power sits alongside warfighting power as a core pillar of national security.

Minister for Defence Readiness and Industry Luke Pollard, speaking at the AGF Defence Summit, put hard numbers to that vision. The Defence Investment Plan commits £298 billion to the armed forces over the next four years – defence spending rising at its fastest rate since the end of the Cold War, with the MoD’s budget growing faster than any other government department this year. Of that, £31 billion has been earmarked for air and space, and £5 billion across the wider DIP for drones and advanced uncrewed systems, an increase of £1 billion on previous plans. A new ring-fenced annual budget of £400 million for defence innovation has also been established, alongside a target to spend at least 10% of the annual equipment budget on novel technologies.

For the supply chain, both ministers were explicit that the scale of investment only translates into industrial benefit if procurement reform, SME access and supply chain engagement are delivered in parallel. Lord Coaker described industry as a trusted partner in deterrence and one of the most potent engines for economic growth, stating plainly that industry will no longer be treated as a separate entity. Pollard went further, challenging businesses and investors directly: the demand signal is now clear, defence knows where it is going, and the task is for industry to come on the journey.

Several structural changes announced or reaffirmed at Farnborough are directly relevant to supply chain businesses. The Defence Office for Small Business Growth, established to deliver a 50% increase in spending with SMEs, published its action plan at the show, committing to increase MoD spend with SMEs by £2.5 billion by May 2028. The National Armament Director Group has been established to speed up decision-making and remove the barriers preventing SME access to defence. The Defence Industrial Joint Council provides a senior strategic forum for supplier engagement, with SMEs holding seats at ministerial level. A £182 million skills package is supporting industry to attract, develop and retain the workforce the sector needs to grow.

Pollard also announced a £20 million contract to Lockheed Martin UK and collaborating SMEs to rebuild Britain’s sovereign hypersonic target capability – a programme expected to support around 60 skilled jobs in Bedfordshire and inject £2 million directly into the supply chain through multiple UK SMEs. The announcement was framed explicitly as a signal that defence is returning to more demanding frontiers of aerospace technology, and that businesses of every size are expected to be part of that journey.

On procurement reform, Pollard was direct about the gap between ambition and current reality. Contracting timescales are too long, and the government is targeting reduced procurement cycles through the Defence Industrial Strategy with, as he put it, everything we’ve got. The Accelerating Commercial Pathways programme, Commercial X and the Defence Innovation Ideas Marketplace are among the vehicles being used to compress the time between requirement, contract and capability.

The aerospace and autonomous systems pipeline was a recurring theme across both speeches. Pollard confirmed that StormFighter – the UK’s Collaborative Combat Aircraft programme – will deliver Europe’s first uncrewed combat jets, teaming autonomously with Typhoon, F-35 and future Tempest platforms. Further announcements on the programme timeline were trailed for the following day. The £31 billion air and space investment will also sustain and upgrade the Typhoon fleet into the 2040s, fund the first F-35As compatible with NATO’s nuclear mission, progress GCAP’s design and test phase, sustain the transporter fleet and recapitalise the jet training system, including new aircraft for the Red Arrows.

For the UK defence supply chain

The combined message from both ministers at Farnborough is one of the strongest signals the defence supply chain has received in a generation. Investment is committed, reform is underway and the explicit political ambition is for SMEs to provide the agility defence needs to be warfighting ready by 2030. For suppliers of all sizes, the task now is to understand where they fit within a rapidly evolving procurement landscape, how to access the frameworks and programmes being stood up, and how to position ahead of a pipeline that is accelerating across multiple capability domains. Key areas of opportunity signalled across both speeches include:

Autonomous and uncrewed systems, including combat air and drone capabilities
Air and space programmes including Typhoon, F-35, GCAP and StormFighter
Hypersonic and advanced aerospace technology
Defence innovation funding through the £400 million annual ring-fenced budget and UKDI
SME-accessible procurement vehicles including Commercial X, the Neutral Vendor Framework and the Dynamic Marketplace
Defence skills, apprenticeships and workforce development through the £182 million skills package
Export markets and allied nation partnerships through the Defence Exports Unit
Regional supply chain growth through Defence Growth Deals and defence and security clusters

These themes sit at the heart of the agenda for the DPRTE UK National Defence Procurement and Supply Chain Summit, taking place on 22 October 2026 at the Kimpton Clocktower Hotel, Manchester – bringing together suppliers, buyers and government to explore how record defence investment is translating into supply chain opportunity.

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