def060508 - no. 43

Session 2005-06, 8 May 2006

Publication of Report and Chairman's comments

Publication of Report and Chairman's comments



The House of Commons Defence Committee has today published a report on the Government’s Defence Industrial Strategy (Seventh Report of Session 2005-06, The Defence Industrial Strategy, HC 824).

The Committee finds:

  • The production of the Defence Industrial Strategy (DIS) to a tight timetable is an impressive achievement: its success will depend upon how well it is implemented and whether the Ministry of Defence (MoD) is adequately funded by the Treasury to deliver it.

  • Defence Research and Technology (R&T) was not adequately covered in the DIS and further work is required in this important area. If the decline in defence research funding is not addressed, it will result in lower quality defence equipment in future.

  • The MoD is planning to make more use of long-term partnering arrangements. There are risks that this could result in monopoly supply in certain areas and there are considerable concerns about the access of the “sub-prime” companies and Small and Medium-size Enterprises (SMEs) to sub-contract work.

The Committee plans to monitor progress closely to ensure that these concerns are addressed, and will be carrying out further inquiries into particular aspects of the DIS.

The Chairman of the Defence Committee, Rt Hon James Arbuthnot MP, said:

“We very much welcome the publication of the Defence Industrial Strategy which gives a clearer steer to industry on the UK’s future defence requirements.

In a number of areas further work is required, in particular concerning the future of Defence Research and Technology.  There has been a reduction in research funding over a number of years, and this threatens to impact on both our industrial competitiveness and our military effectiveness.  We see defence research funding as a key investment for the future.

We also have very considerable concerns about the move to long-term partnering arrangements, and the impact that this will have on smaller companies. The MoD will have to make sure that the long-term contracts are properly incentivised and that there are rules in place to ensure that other companies, particularly Small and Medium-size companies, are given a fair chance to bid for the sub-contract work.

The DIS puts forward a positive strategy for the future but it will not be achievable without adequate funding.  The MoD has to persuade the Treasury to provide the money needed to fund the changes which the DIS requires.  We will be watching closely.”


1. The Government’s Defence Industrial Strategy (DIS) was published on 15 December 2005 with the aim of providing greater transparency to the UK’s future defence requirements and setting out the industrial capabilities the UK needs to maintain appropriate sovereignty and operate equipment independently.

2. Committee Membership is as follows: Rt Hon James Arbuthnot MP (Chairman), Mr David S Borrow MP, Mr Colin Breed MP, Mr David Crausby MP, Linda Gilroy MP, Mr David Hamilton MP, Mr Mike Hancock MP, Mr Dai Havard MP, Mr Adam Holloway MP, Mr Brian Jenkins MP, Mr Kevan Jones MP, Robert Key MP, Mr Mark Lancaster MP, John Smith MP

3. News Release: No. 43


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