House of Commons · Westminster Hall
07 May 2025 · 9 other contributors · 4,379 words
Opened by Luke Charters Lab York Outer
Responding minister: Emma Reynolds
Summarised by AI from the official record, so it can contain mistakes.
Luke Charters raised concerns about defence sector financing in Westminster Hall. A government minister responded.
Key points
Key requests to Government
Calls for the establishment of a multilateral defence development bank to fortify Britain's collective security and bolster its sovereign defence industries by fixing financing issues at home.
MPs spoke in turn to share their views and ask questions. Here's what each person said.
Opened the debate
The UK defence sector faces significant hurdles in accessing finance, bank accounts and insurance. British SMEs struggle with cash flow constraints due to delayed payments from prime contractors, leading some companies to consider moving abroad.
Suggests that a multilateral commercial bank would provide small businesses in Teesside with opportunities for market growth in the defence sector.
Clarified that there is no contradiction between ESG considerations and investment in defence, highlighting the importance of leveraging pension funds for returns from defence companies.
Proposed the creation of a multilateral bank to support private finance and investment in defence. Highlighted divestment from UK defence by large-scale pension funds.
Raises concern about the pension fund trustees' decision not to invest MPs’ contributions in the defence industry and advocates for ethical investment.
Asked if there is clarity about what the Government want regarding sectors like space, where the UK has underperformed compared to its potential.
Suggested looking at the British Business Bank for sector-agnostic support and asked why Ministers are not willing to give a steer to it in line with the ideas discussed.
Supports clarifying ESG rules to better back defence investment, citing Collins Aerospace's role in creating skilled jobs and apprenticeships.
Welcomes the proposal for a multilateral defence development bank, stressing the need to avoid complacency in light of Europe's current security challenges.
Agreed with the idea of greater co-operation in defence procurement and financing with the EU, highlighting the importance for UK companies to have access to EU finance such as the Horizon scheme.
Government Response
Emma ReynoldsThe Economic Secretary to the Treasury
Acknowledged the challenges faced by the defence sector and highlighted recent government initiatives such as reaching 2.5% of GDP in defence spending by 2027, creating UK Defence Innovation, and considering proposals for a multilateral defence bank with allies.