BAE boss requires ‘readability’ as MoD and Treasury conflict over defence spending

The boss of Britain’s biggest defence company has called for ‘clarity’ over the government’s military spending plans amid a blazing row over budgets.

BAE Systems chief Charles Woodburn said the industry stood ready to step up production to help the UK rearm – but needs ‘a clear signal’ of what is required.

He called for the publication of the Defence Investment Plan, which will outline where and how the military budget will be spent but has been delayed amid warnings of a £28billion black hole.

‘What we’re keen to see is the release and publication of the defence investment plan,’ said Mr Woodburn.

‘Much of our large UK programmes, like submarines, the work on the nuclear deterrent, the frigate programmes, are all carrying on. They’re not waiting for decisions on the investment plan.

‘But there are a lot of other programmes that are, and we’re all looking for clarity around that as soon as possible.’

BAE boss Charles Woodburn (right) with defence secretary John Healey and Keir Starmer

The comments came after the Mail this week reported that the Treasury is resisting plans to bring forward a huge rise in military spending.

Sir Keir Starmer has set a target of raising defence spending from the current level of 2.4 per cent of gross domestic product to 2.5 per cent by April 2027 and 3 per cent after the next election.

But that would mean the target may not be met until as late as 2034 – leaving the UK struggling to reach new NATO targets.

Under pressure from Donald Trump, NATO leaders last year agreed to ramp up defence spending to 5 per cent of their countries’ GDP by 2035.

The Prime Minister this week raised hopes spending would reach 3 per cent of GDP by 2029 following crisis talks with defence chiefs.

It was even thought the accelerated timetable could be announced as part of the Government’s economic Spring Statement on March 3.

But it is understood those plans are being resisted by Chancellor Rachel Reeves as the money would need to come from spending cuts elsewhere, tax hikes or more borrowing.

The row comes almost two years after the Daily Mail launched its Don’t Leave Britain Defenceless campaign which calls for Britain to commit to spending 3 per cent by the end of this Parliament.

Asked by the Mail if he was confident the defence spending targets would be hit, Mr Woodburn said: ‘They’ve been clear about growing defence budgets, but the pace at which, we’re waiting to hear how the how the debate plays out.’

BAE built the Agamemnon, an Astute Class attack submarine, at its historic Barrow shipyard

The comments came as BAE posted record annual revenues and profits as it cashed in on what Mr Woodburn described as ‘a new era of defence spending’ as countries in the West rearm.

BAE, which builds and maintains submarines and warships for the Royal Navy and Typhoon fighter jets for the Royal Air Force, said revenues jumped 10 per cent to £30.7billion last year while profits were up 12 per cent to £3.3billion.

‘In a new era of defence spending, driven by escalating security challenges, we’re well positioned to provide both the advanced conventional systems and disruptive technologies needed to protect the nations we serve now and into the future,’ said Mr Woodburn.

As well as supplying the UK military, BAE makes weapons from missiles and artillery systems to tanks, planes and ships for governments around the world including the United States.

The company won a major Typhoon order from Turkey last year as well as an order for Type 26 frigates from Norway.

Mr Woodburn noted that countries closest to Russia were rearming faster than others – highlighting increased spending in Poland and Germany in particular.

‘Certainly, within the European theatre, the pace of increased defence spending is roughly related to how close you are to the fight,’ he said.

‘You see countries like Poland, that share a border with Ukraine, that have significantly increased defence spending and very quickly. We see Germany moving rapidly. We’ve seen the Nordics scaling up. I think those that are closer to the Russian threat are definitely investing faster.’