- The UK’s Autumn Budget, leaked to the media in contravention of parliamentary policy, outlined a series of tax and spend initiatives
- The aerospace and defence sectors were little-mentioned, other than to confirm previously known fiscal plans
- All eyes turn to the long-delayed Defence Investment Plan, which is due to be published before the end of the year
The UK’s ‘Autumn’ Budget, coming technically within the correct season if not the spirit of the timeframe, delivered little insight into the defence sector, as all eyes wait for the publication of the long-overdue Defence Investment Plan.
What little information that was of use came just prior, at the end of Prime Minister’s (PM) Questions, where UK PM Keir Starmer confirmed that the long-delayed New Medium Helicopter (NMH) programme would still be going ahead, in response to a query from a parliamentary colleague.
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“I can confirm we are continuing with [NMH] to deliver modern equipment for our armed forces,” Starmer said, adding, apparently not ironically, that the UK was “a leading member of Nato”.
The only other mention in the Autumn Budget from the UK Government related to assurances by Chancellor Rachel Reeves that the UK would spend 2.6% of its GDP on defence by April 2027, a previously known timeframe.
Quite how the UK will reach this 2.6% target has been previously analysed by Army Technology, with some flexible and interpretive understandings of what constitutes ‘defence’ now required.
However, some voices in the aerospace and defence industries expressed frustration at the lack of attention paid to the sectors.
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By GlobalDataAlan Fisher, CEO of Farnborough Aerospace Consortium (FAC), which represents hundreds of businesses in the aerospace, aviation, defence and space sectors, said the budget could be judged better by what it left out than what it contained.
“The budget was frustratingly lacking in announcements that impact on the aerospace and aviation sectors in which we are world leaders,” Fisher said.
Continuing, Fisher said that investment in defence does provide benefit for FAC members which operate in the sector’s supply chains.
“Other announcements that might be considered positive are corporation tax remaining at 25 per cent, increased enterprise tax incentives, UK listings relief and a permanent 40 per cent First Year Allowance for main rate assets,” he added.
However, Fisher said energy costs remained “extremely high” and that there was a lack of policy announcements aimed at lowering business costs, while industry would have to “wait and see” what impact an increase in minimum and living wages would have on recruitment.
