What the Defence Investment Plan means for techUK members.
Key takeaways
AI and autonomy are the driving force of the DIP. Taskforce RAID and Project Frontier receive £100m each, and the Defence AI Centre is confirmed as Defence’s enduring centre for AI delivery.
Foundational digital infrastructure gets a boost: a £420m top-up takes the Digital Backbone to £1.8bn to 2030, with a further £740m for the Digital Targeting Web.
The ‘Hybrid Navy’ is the DIP at its most ambitious: £1.3bn for a hybrid fleet of crewed and uncrewed platforms, with first prototypes in service by 2030.
Delivery is the risk: over £10bn of efficiency savings are required, and success hinges on concluding Defence Reform. Members now need these commitments translated into programmes of record with clear routes to market.
On Tuesday the Ministry of Defence (MOD) published the long-awaited Defence Investment Plan (DIP) setting out how precisely the MOD would deliver on the recommendations of the 2025 Strategic Defence Review (SDR).
The driving force of the DIP is the adoption of autonomy and artificial intelligence across all domains. Critically though, this is accompanied by the recognition that these systems are only as good as the networks supporting them, what it describes as the ‘foundational digital and data infrastructure’.
Successful delivery lies not just in the funding but also in the conclusion of MOD’s protracted Defence Reform initiative. Given the pace at which the MOD intends to move, this presents a significant barrier to progress on implementing the DIP.
Away from top-level decisions on platforms and the nuclear enterprise, here is what the DIP means for the UK’s defence tech sector.
Artificial Intelligence
The MOD will continue to develop the Defence AI Centre (DAIC) as Defence’s ‘enduring centre for AI delivery’ and stand up a new ‘AI Expert Advisory Group’. It will establish a new Defence Strategic Approach to AI to cohere all programmes with each area ‘setting out detailed implementation and action plans in response’ and produce policy frameworks to govern ‘Dependable AI’ and ‘Responsible Use of AI’.
techUK’s submission to the Strategic Defence Review (SDR) argued that UK Defence has so far lacked a ‘single, recognised authority for providing AI assurance’ and that members would like to see the whole Defence enterprise recognise the DAIC as having this responsibility. We hope this takes it closer to that vision.
Originally announced in June and reporting directly to the Chief of the Defence Staff (CDS), the Rapid AI Delivery Taskforce (known as Taskforce RAID) receives £100m to focus on an initial four core missions: improving planning through automation; operational impact through AI-enabled swarms; machine-augmented intelligence fusion; and delivering advantage in denied and degraded environments. It will operate in six-to-nine-month sprints, and we were pleased to see techUK member Rowden announced as the first project partner.
Critical for the creation of the DTW is the MOD’s long-running Digital Backbone programme acting as its ‘underpinning connectivity and infrastructure’.
According to the 2021 Digital Strategy for Defence, the programme will provide a ‘single technology Backbone to support integration, platform interoperability and operational speed’. The reality is the programme has been dogged by setbacks and delays over the past five years for several reasons, including a lack of clarity as to purpose and design/implementation authority.
The DIP commits £420m to the Digital Backbone, bringing the total to £1.8bn until 2030, to replace ‘fragmented services and networks’.
The DTW then receives £740m until 2030 in addition to the £1bn agreed following the SDR. The DIP refers in general terms to five technology areas including enhanced resilience for Positioning, Navigation and Timing (PNT) capabilities, imagery exploitation, and targeting, but does not specify exactly what form these will take nor which of these is now enabled thanks to the extra funding. It does refer to the Defence-wide Secret Cloud achieving Minimum Viable Product (MVP) status later this year, but this is an existing programme not specific to DTW.
Land, air, sea and space domains
Investment for the Army largely centres around already existing programmes:
Project ASGARD (the Army’s contribution to the DTW) will receive £370m up to 2030 to expand its ‘Recce-Strike’ approach, linking capabilities across vehicles and other platforms.
Project NYX’s budget to develop autonomous drones operating alongside Apache helicopters is confirmed as £220m following the shortlisting of industry partners back in May including techUK members Anduril Industries UK, BAE Systems and Thales UK.
Project Corvus receives an additional £310m to replace the long-range ISR Watchkeeper drones, delivering 24 by 2029.
With a budget of £150m, the Army will launch a programme to deliver heavy and medium Uncrewed Ground Vehicles for payload and close combat support respectively. There is also £400m to deliver a ‘suite of inexpensive expendable autonomous systems and weapons’ and £200m for counter-drone technologies.
The maritime domain and the creation of the ‘Hybrid Navy’ is the DIP at its most ambitious. The Navy will replace future frigate and destroyer programmes with a hybrid fleet comprising a range of surface and subsurface missile and radar platforms supported by six Common Combat Vessels (CCVs). The budget for all this currently stands at £1.3bn between now and 2030, with the first prototypes to reach service by the same deadline.
There is also funding for the Hybrid Carrier Air Wing, anti-submarine warfare capabilities, and an additional £330m for the protection of underwater infrastructure.
Key for the RAF was maintaining the UK’s commitment to the Global Combat Air Programme (GCAP). There is also now £300m to begin work on Collaborative Combat Aircraft (CCA) known as loyal wingmen to operate alongside and in support of the new 6th generation fighter. These will ‘expand sensor coverage, carry extra missiles, and push far ahead of the crewed air component, to enhance survivability and lethality’.
Elsewhere, the DIP commits an initial £40m to the creation of a new ‘Integrated Air, Space and Missile Defence Operations Centre’ (IASMDOC) to integrate command and control of all air defence and space operations. In the Cyber and Electromagnetic Domain, the new CyberEM Force sitting within Cyber and Specialist Operations Command (CSOC) will receive £2.5bn up to 2030 (but without further exposition).
The DIP confirms that UK Defence Innovation’s (UKDI) budget will remain at £400m a year up until 2030 and repeats the pledge to spend 10 percent annually on novel technologies. It did not state how much of this is already committed which techUK understands currently sits at around £200m.
Beyond this though the DIP is light on longer-term investment into emerging technologies. It introduces what it calls a ‘new growth lens to analyse investments’ highlighting ‘frontier industries’ such as AI and quantum as priorities, but there is no mention of DARPA-style research funding into areas such as photonics.
Efficiencies and functions
Like all previous financial settlements for the Ministry of Defence, the DIP will require substantial efficiency savings, totalling over £10bn by 2030 to be found across all aspects of MOD spend.
techUK has long argued that the problems with the MOD’s commercial and contracting functions are significantly hampering its procurement processes. The DIP commits to a one-off ringfenced ‘modernisation fund’ of £500m to ‘fund upfront investments which will genuinely unlock efficiencies and cost-savings downstream’. techUK is already engaging with the MOD on how AI could assist with managing its bids and tenders process including next week.
Conclusion
While many aspects of the DIP are to be welcomed – including the acknowledgement of the need to address those core foundational challenges the MOD faces around its IT infrastructure – it is a vastly ambitious programme. If it is to deliver on many of these commitments, particularly in the maritime domain, it will need to rapidly accelerate and conclude the ongoing Defence Reform initiative and portfolio management reorganisation. The delays in appointing decision makers into these roles were highlighted by techUK members just last month as presenting a real barrier to completing contracting processes.
There will always be the case for additional spending and there remain questions about the MOD’s ability to meet its own ambitious deadlines. What industry now needs though is for MOD to translate these commitments into programmes of record with clear routes to market allowing techUK members of all sizes to align priorities and invest in the skills required to deliver them.
Associate Director, Defence and National Security, techUK
Fred Sugden
Associate Director, Defence and National Security, techUK
Fred is responsible for techUK's activities across the Defence and National Security sectors, working to provide members with access to key stakeholders across the Defence and National Security community. Before taking on the role of Associate Director for Defence and National Security, Fred joined techUK in 2018, working as the Programme Head for Defence at techUK, leading the organisation's engagement with the Ministry of Defence. Before joining techUK, he worked at ADS, the national trade association representing Aerospace, Defence, Security & Space companies in the UK.
Fred is responsible for techUK’s market engagement and policy development activities across the Defence and National Security sectors, working closely with various organisations within the Ministry of Defence, and across the wider National Security and Intelligence community. Fred works closely with many techUK member companies that have an interest in these sectors, and is responsible for the activities of techUK's senior Defence & Security Board. Working closely with techUK's Programme Head for Cyber Security, Fred oversees a broad range of activities for techUK members.
Outside of work, Fred's interests include football (a Watford FC fan) and skiing.
Jeremy manages techUK's defence programme, helping the UK's defence technology sector align itself with the Ministry of Defence - including the National Armaments Directorate (NAD), UK Defence Innovation (UKDI) and Frontline Commands - through a broad range of activities including policy consultation, private briefings and early market engagement. The Programme supports the MOD as it procures new digital technologies.
Prior to joining techUK, from 2016-2024 Jeremy was International Security Programme Manager at the Royal United Services Institute (RUSI) coordinating research and impact activities for funders including the FCDO and US Department of Defense, as well as business development and strategy.
Jeremy has a MA in International Relations from the University of Birmingham and a BA (Hons) in Politics & Social Policy from Swansea University.
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Associate Director, Defence and National Security, techUK
Fred is responsible for techUK's activities across the Defence and National Security sectors, working to provide members with access to key stakeholders across the Defence and National Security community. Before taking on the role of Associate Director for Defence and National Security, Fred joined techUK in 2018, working as the Programme Head for Defence at techUK, leading the organisation's engagement with the Ministry of Defence. Before joining techUK, he worked at ADS, the national trade association representing Aerospace, Defence, Security & Space companies in the UK.
Fred is responsible for techUK’s market engagement and policy development activities across the Defence and National Security sectors, working closely with various organisations within the Ministry of Defence, and across the wider National Security and Intelligence community. Fred works closely with many techUK member companies that have an interest in these sectors, and is responsible for the activities of techUK's senior Defence & Security Board. Working closely with techUK's Programme Head for Cyber Security, Fred oversees a broad range of activities for techUK members.
Outside of work, Fred's interests include football (a Watford FC fan) and skiing.
Jeremy manages techUK's defence programme, helping the UK's defence technology sector align itself with the Ministry of Defence - including the National Armaments Directorate (NAD), UK Defence Innovation (UKDI) and Frontline Commands - through a broad range of activities including policy consultation, private briefings and early market engagement. The Programme supports the MOD as it procures new digital technologies.
Prior to joining techUK, from 2016-2024 Jeremy was International Security Programme Manager at the Royal United Services Institute (RUSI) coordinating research and impact activities for funders including the FCDO and US Department of Defense, as well as business development and strategy.
Jeremy has a MA in International Relations from the University of Birmingham and a BA (Hons) in Politics & Social Policy from Swansea University.
