House of Commons · Westminster Hall
28 January 2025 · 15 other contributors · 9,037 words
Opened by Alan Strickland Lab Newton Aycliffe and Spennymoor
Responding minister: Maria Eagle
Summarised by AI from the official record, so it can contain mistakes.
Alan Strickland raised concerns about defence procurement: small and medium-sized enterprises in Westminster Hall. A government minister responded.
Key points
Key requests to Government
We need to change how we think about defence procurement, adopting a proactive entrepreneurial approach that encourages innovative SMEs to contribute new ideas and technologies to tackle future military challenges.
MPs spoke in turn to share their views and ask questions. Here's what each person said.
Opened the debate
Procurement is not usually a topic that gets pulses racing, but the threats posed to the UK and our allies certainly should. Technology has been rapidly altering the nature of warfare at an unprecedented pace, as seen in Ukraine with drone technology rewriting the rules of modern conflict. Central to responding to these challenges is using the defence industrial strategy to unleash British industry's inventiveness, ingenuity, and creativity.
Discussed challenges faced by innovative SMEs and proposed measures such as reserving complex framework contracts for large projects only, breaking down large contracts into smaller components accessible to SMEs.
She thanks the hon. Gentleman for giving way and agrees that the Ministry of Defence should ensure emerging technologies such as quantum computing being spearheaded by SMEs are part of its procurement strategy.
Critiques late payment practices by prime contractors, which affects SMEs’ cash flow and growth opportunities. Advocates for legislation to enforce timely payments to ensure fair treatment of SMEs. Argued for fair payment practices by the MOD to SMEs. Brought up important points about payments relevant to SMEs.
Commends the Government’s engagement with businesses of all sizes in defence procurement. Teesside is ready to lead future capabilities, with companies like Tracerco and Wilton playing crucial roles. Talked about the Teesside defence and innovation cluster and companies in his constituency, invited a visit from the Minister.
Highlighted the importance of primes for delivering sovereign capabilities. Argued that primes can offer SMEs an ability to communicate with the Government, helping them advertise their abilities.
Liberal Democrats propose replacing rigid defence reviews with a more flexible system to adapt to evolving security threats, focusing on collaboration with NATO and European partners. She also highlights the need for simpler access to contracts and reduced bureaucracy. Expressed support for a comprehensive industrial strategy, including defence as one of the growth sectors.
The Conservative MP, who previously served as Minister for Defence Procurement, underscores the importance of SMEs in modern warfare contexts like Ukraine. He supports the idea of a more flexible procurement system and highlights the changing nature of defence technology. Supported the importance of standing by Ukraine and praised Ben Wallace for taking the risk to ship NLAW despite legal advice.
Northern Ireland SMEs received only £2 million of MOD expenditure in 2022-23 compared to £408 million for the south-west of England. Urges fairness and equity in contract distribution. Pointed out that MOD spend in Northern Ireland is less than in some regions of England and asked for the number to be increased. Emphasized the role of small businesses in meeting defence challenges.
He commends the hon. Gentleman for bringing this topic forward and agrees that Northern Ireland must be an integral part of supporting all SMEs across the United Kingdom, including those providing critical capabilities like Thales in cybersecurity. Discussed the importance of economic growth driven by the defence industry.
Stressed the significance of involving small businesses in defence procurement.
He is grateful to his hon. Friend for securing today’s debate and suggests that the Ministry of Defence needs to completely change its culture and processes in how it liaises with important and innovative companies, as seen in constituencies like his.
Reminded the House that from small acorns great oaks grow, highlighting how even big companies like Rolls-Royce and BAE Systems started as SMEs. Emphasized the need to support innovative businesses.
Highlighted the importance of local defence industry in Honiton, focusing on Supacat’s contribution to military vehicle production. Called for orders beyond 2025 to secure future employment. Mentioned Supacat, an example of a company providing jobs and economic growth in his area. Expressed pride in defence contractors around the country.
Welcomed the Defence Secretary’s plans for a new defence industrial strategy. Emphasised Glenair's role as an innovative employer with over 1,000 employees and nearly 60 apprenticeships. Asked for a visit and mentioned a firm supplying products across domains. Highlighted the importance of economic growth driven by the defence industry.
He agrees that defence contract opportunities must be made more accessible to SMEs in order to support their growth and continue innovation. He notes the Government's own Green Paper recognises the need to address issues inhibiting or preventing growth in the defence sector.
Government Response
Maria EagleThe Minister for Defence Procurement and Industry
The Government has boosted spending this year by just under £3 billion in real terms, setting out a pathway to reach 2.5% of GDP on defence. The procurement system was described as 'broken', but changes are being made to respond more swiftly to the changing face of warfare and support SMEs. Discussed increasing SME involvement in procurement processes, acknowledged concerns about late payments and protested activities on university campuses. Emphasised the importance of ethical investment in defence for security reasons.