Promoting Our Prosperity
Minister for Defence Procurement Harriett Baldwin's address to the Chatham House Security and Defence Conference 2017
I鈥檓 delighted to join you for the final session of this conference.
Over the last two days you鈥檝e been discussing a security landscape that is becoming increasingly unpredictable and uncertain.
Recent and future elections will lead to change at the political level, while the nature and scale of the threats addressed by those of us working in security policy demands constant flexibility commercially and militarily.
Recently聽the independent reviewer of terrorism law in the UK (Max Hill QC) said, that, in this country, the danger of attack is as great as at any time since the 1970s.
Yet we don鈥檛 just face threats from non-state actors, terrorists and Islamic extremists. We are also standing up to Russian aggression and cyber warfare - the activities of state actors.
At the same time, we鈥檙e preparing to implement the decision of the British people to leave the European Union鈥�
But while we are leaving the EU, we are emphatically not leaving Europe. As a country we are stepping out more into the world, stepping up our global role and our commitment to European and international security.
How is the UK Ministry of Defence prioritising and responding to the challenges and opportunities before us?
IMPLICATIONS FOR UK DEFENCE
The short answer is that, despite big changes, our priorities are staying the same.
Our three National security objectives were set out in 2015鈥檚 Strategic Defence and Security Review to protect our people, project our influence, and promote our prosperity.
These objectives remain right for today 鈥� and we are backing then with growing resources.
We鈥檙e one of only five NATO nations meeting the 2 per cent target, and we鈥檒l continue investing in defence equipment, using our growing budget, and 拢178bn ten-year equipment plan to spend on world-beating capability such as Dreadnought submarines, two new aircraft carriers, frigates and new aircraft including F35s and the P8.
Above all, we鈥檙e determined to be what our Prime Minister calls, a 鈥済lobal Britain鈥�
working with our NATO and other allies to front up to aggression from a position of strength, while joining forces with our bi-lateral friends bringing the full range of our capabilities to bear on international problems.
RELEVANCE FOR DEFENCE INDUSTRY
And what of the Defence industry?
Rest assured, we鈥檙e more aware of its value than ever, and the contribution that we need and expect from industrial partners.
And nowadays we鈥檙e not just looking for industry to devise new game changing technologies, making the most of autonomy, cyber and big data to keep one step ahead of our competitors.
Nor are we simply expecting a focus on value for money鈥s the demands on our budget rise.
We鈥檙e also turning to industry to enhance the UK鈥檚 prosperity.
The 2015 Strategic Defence and Security Review was the first time we officially recognised promoting prosperity as a national security task.
Strategic exports are now a core activity for the Ministry of Defence so we are calling on companies to play their part in increasing defence export sales and attracting inward investment into the UK.
It鈥檚 a lot to expect but the good news is we鈥檙e here to help.
We are not going to retreat into a protectionist shell.
We don鈥檛 believe in propping up inefficient industries
As a trading nation, we believe in the power of free trade to push our companies to export further.
So we鈥檙e going out of our way to create a can-do, outward looking, pro-growth culture.
In three ways:
1. INNOVATION 聽
First, we鈥檙e investing in innovation. This is an area where Britain traditionally has had strength in depth.
We gave the world radar, the jump jet and the world wide web.
Today we鈥檙e leading the way in wing design and intelligent systems. Tomorrow聽we will have produced dragonfly drones and sub-orbital engines.
But we can鈥檛 rely on natural talent and serendipity to see us though.
So six months ago, we launched our innovation initiative.
It鈥檚 all about pushing the boundaries, making defence more open to risk and new ideas.
We鈥檙e speeding up the time it takes for suppliers to turn concepts into capabilities.
We鈥檝e set up an Innovation Fund worth around 拢800m over ten years to pump prime聽investment into advanced new solutions such as laser directed energy weapons and unmanned rotary wing technologies.
And we鈥檙e running a set of competitions to develop leading edge capabilities in everything from rapid and automated integration of new sensors to machine learning algorithms.
Last week we unveiled the next stage in our plan.
Professor Hugh Durrant-Whyte has become our new Chief Scientific Adviser with direct accountability for the defence research programme, which is 1.2% of Defence鈥檚 annual budget.
He鈥檒l be working across defence and internationally聽to stimulate defence innovation, commission research, and use technology to keep our people safe.
At the same time, we鈥檝e been gearing up our new Defence Innovation Advisory Panel with high-profile appointees including astronaut Major Tim Peake, outgoing director of GCHQ, Robert Hannigan and the founder and chairman of McLaren, Ron Dennis.
These inspiring individuals will challenge the Defence聽status quo鈥nsuring we become innovative by instinct.
2. INDUSTRIAL STRATEGY
There鈥檚 a second way in which we鈥檙e creating a pro-growth culture.
We鈥檙e tapping into the broader currents of Whitehall鈥檚 industrial strategy by strengthening clusters of defence capability around the country whether in Scotland, the South West, the North West and North Wales.
We鈥檙e determined to reinforce the way in which the Defence industrial base helps to make this a country that works for everyone.
Sir John Parker鈥檚 recent report suggested how we could use regional centres of expertise to improve our shipbuilding capability, embracing digital engineering and proposing the creation of a Virtual Shipbuilding industry model.
In other words, rather than a single shipyard building a ship from scratch, a vessel would be built in blocks by different sites across the UK 鈥� from the South West to Birkenhead to Tyneside. As we鈥檝e done with our aircraft carriers ensuring high productivity, competitive cost and a dramatic reduction in build time.
Sir John鈥檚 report will inform our shipbuilding strategy due out in the Spring.
Meanwhile, Scottish shipyards have two decades of future work.
But switch domains鈥rom sea to air鈥nd you can already see what stronger clusters will mean for the UK.
Over in North Wales, Government and business joined forces and last year won the F-35 avionics Maintenance, Repair and Overhaul contract award.
Their bid was so compelling it established Britain as a hub for all European F-35s sustaining, in turn, potentially thousands more high value jobs across the supply chain generating hundreds of millions鈥nd potentially several billions of pounds of revenue supporting hundreds of聽jobs in Wales and extending聽Britain鈥檚 reputation for excellence worldwide.
I鈥檇 like to thank all those who helped make it possible.
It was a truly team UK effort.
And 15% of the global programme of c.3,000 F35s are being built in the North West.
3. PARTNERSHIPS
But this brings me to my final point.
Creating a pro-growth culture, means strengthening partnerships between Government and industry.
So we鈥檒l be looking to you to collaborate more 鈥� sharing the risk and reward of research and development.
We want you to build exportability in as standard from the outset鈥� placing even greater emphasis on the聽use of modularity and open systems.
And we鈥檒l be looking for you to increase bid opportunities for UK suppliers 鈥� large and small.
You help UK defence and prosperity and we鈥檒l help you.
That鈥檚 why we鈥檙e making sure our refreshed industrial strategy will continue supporting the growth and competitiveness of UK companies and UK skills.
It鈥檚 why we鈥檙e reaching out to imaginative industries outside defence鈥o import new ideas and ways of working. This time last week I was in Farringdon鈥hairing the Small Business Forum at a digital start-up company.
It鈥檚 why we鈥檙e working day and night alongside our colleagues in the Departments for Exiting the EU and Business, Energy and Industrial Strategy to address issues that affect industry after we leave the EU; whether it鈥檚 Defence exemptions from EU regulations on movement of goods or access to skills and experience.
And it鈥檚 why we will continue to bang the drum tirelessly for British business at home and abroad鈥hrough doubling export support鈥hrough our expanded Defence attach茅 network鈥nd through speeches like this.
CONCLUSION
聽 So despite the constancy of a changing world, exciting new possibilities are opening up.
And by working together to build winning capabilities we will do more than enhance our security, more than increase our prosperity, more than inspire a new generation of innovators.
Together we will show that the UK truly is a great global nation, open for a business and a force for good in the world.