John Healey and Al Carns resigned last week rather than put their names to a Defence Investment Plan (DIP) that fails to fund our nation’s security. They were right to go.
The Strategic Defence Review (SDR) – a framework document the UK’s Ministry of Defence published in 2025 – estimated the UK needs £28 billion over the next five years to rearm and update its defence posture. On Monday, Healey discovered the DIP would give him £13 billion. That is shameful.
Dan Jarvis, a former soldier, has replaced Healey. But the Government cannot now publish the DIP with any credibility. It commissioned the SDR to advise it on how to invest in defence. It should heed that advice.
I watch this from two vantage points.
As an investor in early-stage defence technology, I have been eagerly awaiting the much-delayed DIP. As the Government’s response to the SDR, it signals where revenue will flow over the next decade. It should also be a map of which capabilities and suppliers the MoD intends to back. That is useful demand signal for an investor.
As a serving Royal Marines reservist, I see it from the other side. The DIP will shape the ability of our armed forces to fight the battles of tomorrow: the equipment in our hands and the systems above our heads.
Get it right, and we set the stage for our nation’s success in future conflicts. Get it wrong, and we undermine the foundation of our security for decades.
It is tempting to dwell on how, in its current form, the DIP would fail the men and women serving in our armed forces. Or how it would diminish the UK’s relevance on the international stage. Or how it emboldens adversaries like Russia. All of that is true. But I want to focus on what it means for the future of defence technology, because that is what will define our warfighting ability 10 years from now.
We are at a historic inflection point in battlefield technology.
The war in Ukraine has compressed development cycles from decades into months. Drones and counter-drone systems are iterated on the battlefield in near-real time. And AI has accelerated this further, turning software updates into a weapon of war.
The assumptions underpinning traditional defence procurement are collapsing fast. Not only must we move from stockpiling to production agility. But we must also, in the words of a colleague, “get on the right side of economic asymmetry.”
The lesson from Ukraine and Iran is that downing a $50,000 Shahed-type drone with a $3 million missile is unsustainable. As is having our $5 million tanks taken out by $50,000 drones.
Healey’s resignation letter is worth reading closely. Buried among the achievements he lists is the commitment to “invest in the technology that is changing warfare and back British industry to make defence an engine for growth.”
That is the part of the DIP I care most about, because funding defence is not the same as funding the future of defence.
It is relatively easy to buy more of what we already have: more ships, more shells, more spare parts. It is much harder, and much more important, to nurture the technologies that will win the battles of the 2030s: autonomous systems, AI-enabled targeting, uncrewed platforms patrolling the North Atlantic.
Healey also warned that the settlement’s extra support is “backloaded” when the pressure is in the first two years. For established primes, that is a budgeting problem. For emerging technology, it is fatal.
Early-stage companies live on eighteen-month runways; a startup with a prototype cannot wait until 2032 for its first order. It will fold. Or it will move to a country that will buy from it. And plenty will: the United States and our European neighbours are signing contracts with young defence companies at a pace the MoD has yet to match.
Talent and capital are mobile. An ecosystem takes a decade to build and a single budget cycle to kill. If the DIP starves early-stage defence technology now, we will not simply have less of the future. We will have handed it to someone else.
