What the Spring Statement means for Defence

26 Mar 2025 08:49 PM

With a ringfenced budget of £400m, UK Defence Innovation (UKDI) will:

• Drive significantly faster innovative procurement
• Actively foster a strong UK defence technology sector 
• Unlock the full potential of defence spending for wider economic spillovers

The Hub will be operational by July 2025.

Also announced:

The MOD will ‘significantly’ increase what it spends on novel technologies, including dual-use, AI capabilities, and autonomous systems – with a minimum spending target of 10 percent per annum, starting from April this year.

On procurement reform, the MOD will take a ‘segmented’ approach, with each segment having their own timelines:

• Major platforms (including tanks and aircraft) to contract within two years
• Pace-setting upgrades (including comms and sensors) to contract within one year
• Rapid commercial exploitation (including software) to contract in three-month cycles

Finally, as the new Defence Reform model comes into operation from 1 April this year, the Chancellor and Defence Secretary will co-chair a new Defence Growth Board to increase economic growth by boosting Research and Development in advanced technologies, such as Directed Energy Weapons.

techUK’s has long called for a single point of authority within the defence enterprise, to collate innovation intelligence to ensure that proved technologies achieve pull-through to the end-user, while reducing duplication and closing the tech ‘valley of death’. Read more in our Strategic Defence Review submission here.

For techUK's full readout of the Spring Statement, please click here.