Helen Maguire

I absolutely agree and will come to that later in my speech. By focusing its limited research and development budget on adapting high potential dual-use technologies for defence purposes, the MOD can maximise innovation while delivering value for taxpayers. Furthermore, by involving more SMEs, we can manufacture critical components locally, reducing security risks associated with reliance on non-NATO or non-European allied suppliers. That approach also spreads the economic benefits, stimulating regional economies, creating jobs and fostering innovation. Defence contracts provide stable revenue streams, enabling SMEs to invest, scale up and contribute more broadly to the economy. The previous Conservative Government let small businesses down. They created chaos and uncertainty when businesses needed certainty and stability, especially in the aftermath of the pandemic. Liberal Democrats are fighting for a fair deal for SMEs, starting with overhauling the unfair business rates system and providing more support with energy costs. The current state of SME participation in MOD procurement is underwhelming. Only around 5% of the procurement budget is allocated to SMEs; 42% of contracts go to the same 10 suppliers. That is simply not good enough and we can do better. We welcome the announcement of a new defence industrial strategy, and we hope it is completed swiftly so that businesses can plan. I especially welcome that one of the six priorities of the strategy is to prioritise UK businesses, and another involves fostering a more diverse community of suppliers, including non-traditional SMEs. We will hold the Government to account on sticking to those priorities. Ultimately, I want to see the strategy turn into meaningful action. SMEs need simpler access to contracts and reduced bureaucracy, including help to overcome defence-related banking challenges and support to compete on a level playing field with the largest suppliers. It is time for the Government to unlock the potential of SMEs to fuel local economies, increase the UK’s defence sovereignty and lead on innovative technologies.