Charles Woodburn, the chief executive of defense giant BAE Systems, has urged Prime Minister Andy Burnham to provide a detailed plan for achieving NATO defense spending targets. Woodburn welcomed Burnham's commitment to reach the alliance's goal of spending 3.5% of national income on defense by 2035, but emphasized the need for a clear roadmap to that objective.
The call comes as the new prime minister faces scrutiny over his commitment to rearmament, particularly as fears of Russian aggression in Europe persist. Burnham has not yet agreed to calls to achieve a 3% spending level by 2030, a target previously advocated by the current Chancellor, John Healey, when he served as Defence Secretary.
BAE Systems, a major manufacturer of fighter jets, submarines, warships, and armored vehicles, recently reported strong financial results. The company announced an 11% rise in underlying profits to £1.7 billion for the first half of the year, with sales increasing by 9% to £15.8 billion. This growth has been attributed in part to a surge in demand following Russia's full-scale invasion of Ukraine in 2022. The company's order backlog reached a record £84 billion, and it has upgraded its full-year profit outlook.
Woodburn, speaking to the Mail, stated, 'What we’re all looking for is a clear pathway towards that.' His comments are expected to increase pressure on Burnham to elaborate on how his government intends to accelerate defense investments. While Defence Secretary Wes Streeting has declined to commit to the 3% target by 2030, he has pledged that defense will not be approached 'on the cheap.'
Burnham and Streeting recently visited BAE's shipyard in Barrow to announce a £5.9 billion investment in the Dreadnought class of nuclear-armed submarines. Woodburn noted that the presence of both leaders at the shipyard underscored their support for the defense sector. He also acknowledged the increasing public awareness of threats posed by Russia and other adversaries to democratic values and freedoms.
The defense sector had experienced uncertainty due to previous delays in the government's defense investment plan. However, the recent publication of this plan, which includes commitments to multinational projects like the Global Combat Air Programme involving the UK, Italy, and Japan, has provided some reassurance to companies like BAE Systems.