Steve and Dave reflect on the DIP
Steve and Dave discuss the Prime Minister's speech this morning announcing the Defence Investment Plan covering why it matters, what it means, and how we need to learn the right lessons from the war in Ukraine.
Machine-generated from the recording, so expect the odd mis-hearing. 7,817 words.
Steve: hello everybody. Welcome to a special edition of our podcast where we're kind of having a look at the soon-to-be released, hopefully in full text, defense investment plan, what it means for the United Kingdom, what it sets out, and asking some hard questions about it. I'm joined by Dave, the usual kind of co-host of this of this podcast. I will say we're gonna do a different format here. Normally our stuff is is well at least a little bit curated. We've not done that at all. This is relatively hot off the press. The prime minister just stopped speaking about an hour and a half or an hour and 45 minutes ago. So we're we're kind of responding to this on the fly. So this is a little bit unscripted. So if we go off in a direction that's a bit of a tangent, then we'll apologize now. but with all of that said, yeah, yeah. With all of that said, let's let's get stuck in. Dave, Dave: No cuff too tough.
Steve: We'll get into kind of the detail of what is in the dip in a second, but can we take a step back and can you just paint the picture of what the devent defense investment plan is, why it's important? And I think you know, one of the key questions that a lot th that that a lot of people are asking is how is this related to the S Dr that came out last year?
Dave: Yeah, thanks, Steve. so context for that question is a few years ago when I was wearing uniform, one of the jobs that I did was was work in the secretariat team on what we refer to as the fifth floor of the Ministry of Defence. So the Ministry of Defence Building in Whitehall clearly has a number of floors, and different things happen on those four floors. So the fifth floor is where, as we described it, the grown ups hang out. So that's the Secretary of State, the ministers, the Chief of Defence staff, the vice chief.
Steve: Shed.
Dave: and I was it was a real privilege actually, privileged to be part of the Secretariat team that can trace his lineage back to the Secretary of the Chief of Staff in Winston Churchill's time as Prime Minister. you know, there's a direct kind of linkage there. So if you look at some of those old photos, you can see the secretary alongside the chiefs and and Winston Churchill and those leaders at the time. So that was super cool job. but I did that at a time when the national security capability review was happening. So I've kind of seen one of these from the inside and what it what it looks like. so last year we had the strategic defense review, and that was a document that was authored by some as well were classed as external consultants, but but but they really weren't. You know, they were definitely trusted inside the tens, people with bags of experience in this field.
Steve: not sure Richard I'm not sure Richard Barrens would would would love being called an external consultant to the MOD these days, but Dave: Exactly, no. I think well, I think technically though, you know, that's what it is now. But anyway. but the point is that you had these recommendations that were made, uncosted, so agnostic of what they would cost, to say this is what we think the future of defence needs to look like. And there's a big headlines in there, particularly things we were interested in, investment in cyber, but also a whole bit around digital enabling technology, which is sort of linked.
Steve: wow, yeah, yeah.
Dave: And then some broader things around what the big headline threats and capabilities might look like. But importantly, that's it's not a plan, it's a review, it's a set of recommendations, it's uncosted and to a large extent undeliverable in the form that it was released. So what then happens is through the usual machinery of government process, there is a a set of spending rounds and spending reviews, and these are chunked up differently with different departments at different times, but ultimately They have to answer the question of how much money does a given department have to spend? What is a spending envelope? At big cross-government level, they have to decide where that money is coming from and how that is going to be resourced. And then within the Ministry of Defence, this is the really important part, is then there's a question of how do we map that spending envelope against a series of capabilities, programs, ships, tanks, aircraft, people, enabling functions.
Steve: Cybers.
Dave: all the various cybers, all the cybers, all the various capital and resource costs that that that make up what our armed forces and our broader ministry of defence and also slither related things like elements of the intelligence apparatus are able to do. everyone has got very excited about this plan for a couple of reasons. One, it's been delayed. So I think everyone would have preferred to see defence investment plan come Really quickly off the back of the SDR that showed a direct linkage between, okay, here was the recommendations, here's a costed plan of how we're going to get to those or not, but here are the reasons why. so it's been delayed for you know, pro probably realistically 12 months to where it needed to be. it's caused headlines because it's controversial. So and this is one of the really sort of fascinating things about government, I think, is if you ask general public, you know, what are their concerns about? I I don't doubt that it'd be things like immigration, cost of living, cost of fuel, NHS, you know, all these things are gonna be top of their priorities. For for people like us who've been inside government or inside some of these more privileged positions, and and frankly still keep a close eye on what's going on in the world, then we understand that there's a bit more to be concerned about out there beyond those immediate day-to-day things. Not to not to talk those things down, because of course everyone's primary focus is what could affects them and their family, and rightly so. But there is a bigger picture. So if we look at obviously the war in Ukraine, what happened in the Middle East, but also you know, all the things that don't even make the news, you know, what's happening in in Sudan, what's happening in parts of South America and the rise of populism there. And you start to wind up all of those things, you know, it's not even mentioning Taiwan, that China, Taiwan, and that part of the world. Then you realise the world is a pretty sketchy place, and we'll probably come back to that. So it's controversial because there's a difference of opinion in different parts of government about what the priorities are. And that really played out very publicly between John Healy, the former defence secretary, and the Treasury. As it always does. I actually wrote a paper when I was at Staff College on defence reviews over the years. And they all follow a very similar pattern, which is ultimately the dispute between the Ministry of Defence. and the Treasury, because they've got very different priorities and focus. So there's that. And then you overlay all that the final bit of context, which is the fact that Keir Starmer has resigned as Prime Minister. This is probably going to be his last big policy act, I suspect, because you know, Parliament's gonna rise pr pretty soon and and everything's pointed towards we'll have a coronation of Andy Byrne's new Prime Minister. So it's got a lot of attention, probably far more than this kind of plan normally would.
Steve: Probably, yeah.
Dave: But just to bring it right back to where some of you watching this might care about, on the assumption that you know people in our in our kind of broader orbit are are listening to this or watching this, is for the defense supply chain, the lack of a plan, the lack of a clear funded envelope has been a real challenge over the past 12 months because it affects affects confidence, it affects follow-on supply chains, it affects investments. and you even to the point that we've we've we've heard stories of really quite big companies going bust because they didn't have the investment secured, because there was no plan coming out to government. so I think lots of people will care about this for different reasons, but it's definitely controversial. sorry, that was probably a longer answer than it needed to be, but I thought it was a good set of context.
Steve: Yeah, no, I mean it's important to get to go over all of that because you're right, there is a lot of kind of focus on this defense investment plan and for specific and good reason, right? I think there's a lot of things going on. I come back to the thing that I always say. This is the most dangerous time since the since the Cold War. So it's it's unsurprising that we need to really focus our efforts on on how we're going to expend the treasury, the the treasure of the nation on on the defense of the nation, right? So So I think it's it's right to set the context of all of that. So I really appreciate you getting into that. so broadly speaking, SDR kind of talks about what the future force needs to look like and dip talks about how we're gonna spend money to get there. Is that is that roughly it?
Dave: Yeah, it is. That that said, you know, even since the SDR, the context has has changed again with with what's happened in Iran, with what has happened either the Atlantic and and statements around NATO and Greenland and all these all these things have happened since the SDR was published. So there are these things are always going to be a moment in time. And that's part of the challenge of the dip is this needs to set a multi year funding envelope f in a really, really dynamic Steve: Yeah.
Dave: rapidly changing scenario, which is which is why some of the judgments around the way that we will spend the money, not just what we're gonna spend it on, but the way that it will spent become really important and and we should definitely come back to that.
Steve: Yeah, I mean you mentioned the year in between roughly, roughly a year between the SDR and and the r release of the of the dip today. and I think that year is it just really highlights the enormous complexity in which the UK is trying to kind of thread a whole bunch of needles right now in terms of economy, in terms of finances, in terms of defense, in terms of our relationship. Europe in terms of the transatlantic relationship at a time when, as Mark Carney likes to say, we're in a rupture, not a transition, in global world orders, right? So I think that year provides a bit of testimony there. But okay, let's let's move off of that now for a second and focus on the kind of headline statements. And and I should say the full text of the Divest Defense Investment Plan hasn't been released yet. So I haven't gone through this in detail. So we'll make a few kind of Headline kind of assessments just based on what the Prime Minister said earlier today, alongside the Chancellor of the Exchequer and the still still wondering where his office is, Dan Jarvis, the the defense secretary, and some of the statements that have come out on the gov.uk website specifically kind of highlighting the headline kind of level. So let's let's go over the headline levels. So the the first thing to say is it's it looks like 15 billion. 15 billion of extra investment. So that's an important thing, right? So so our armed forces were already committed with a with a committed spend package over the next few next four years. this is 15 billion on top of that, taking the total to nearly 300 billion. And I think it's important to note that that is by far the largest investment in our armed forces since the mid eighties.
Dave: Yeah.
Steve: when the Cold War was still on, when we still had a very large Soviet nuclear threat that was not far away. And I, you know, I recognize that Glasnost and Perestroika were starting around then, but broadly speaking, this is the biggest investment in our armed forces since the 1980s. That's, as the prime minister said, almost half a century ago, which you know is not insignificant. All of that said. It falls short of the roughly 28 billion that I think Al Carnes and and John Healy were looking for. I say them, but you know, the the the ministries for which they were representing. So the other thing, the other kind of headline statement that the Prime Minister liked to kind of put into bright lights was he he was talking about, in fact, I think it was the Chancellor who was talking about 60,000 extra. Direct and indirect jobs that were coming from this new uplift in investment and this 15 billion. And what that was meaning was I I read that in a in in a in in a way that I think the chancellor and the soon outgone prime minister are looking at two things. One is they're looking at increasing the investment in our armed forces to to increase our national security, as Rachel Reeves said. National security is economic security, and and I think those two things are tied. I think that the inverse is meaningful as well. Economic security is national security, but those two things are intrinsically tied. but I think they're looking to make sure that this 15 billion is actually going to be used in a way that actually increases the UK's hard power. That's a that's a good investment. That is a a a virtuous objective. But I also think that they are hoping. That sixty thousand extra jobs and a lot of kind of focus on AI, which we'll get into the the the form of the of the defense investment plan in a second. But I think they're hoping that that investment in some way catalyzes some more growth of the UK economy at a time when we're struggling to grow, and specifically looking at tools like AI to help the UK with its productivity, which is, you know, our economy's been slow in growing, but our productivity has been tremendous slow at growing broadly since 2008. And I have my own views on austerity and what that meant for our productivity. But by and large, we've been, we've been struggling to to grow in terms of productivity. So those are the headline statements. Anything to add there, Dave?
Dave: No, I think I think that's right. you know, there's a bit in there about some some realisms of this, you know, so there's a bit of a hint of where the money's coming from. So talk of some of the projects being scrapped or or delayed, but not a lot of detail on that out yet. But I do think it's important to lay out that these are hard choices. You know, there there isn't a we all remember the old the magic money tree, from which whichever government it was, you know, these are these are difficult choices that have had to be made. So I think that's that's important. And then you know more broadly, there's there's the sort of the content of it. But I get I guess we'll get onto that in a minute, which is to say, you know, what what is actually in there?
Steve: Let's let's pin that because let's c I yeah, I think we should spend a bit of time kind of delving into that a little bit. One of the things that I wanted to kind of focus on was there's a lot of talk about percentage of GDP and how much of our GDP is going to this. Personally, I can see why there's a lot of focus on this, not least of which NATO commitments and Donald Trump and et cetera, et cetera. Personally, I prefer to focus on the real numbers rather than the percentage of GDP numbers. I personally think it's a bit of a red herring. To measure in that way. What I'd rather do is look at the strategic defense review, look at the defense investment plan, and see if if those two things measure up, because the strategic defense review, written by people that I have an awful lot of faith in, their ability to clearly articulate what the nation needs in terms of its national security. and the defense investment plan is, you know, that that's the real stuff. That's the the actual stuff that's going to make a difference rather than kind of. big P politics headline statements about about percentages of GDP. So let me ask you the million the million pound qu well, several billion pound question. Yeah. Let me let me ask you the 15 billion pound question. Is it enough, Dave?
Dave: A fifteen billion kind of question, yeah. Well, I'll come back to my point about hard choices. Right. So anyone who manages any budget, whether you're managing your household budget or you're managing 300 billion pounds, I would suggest has the ability to use that budget and to live to those means. there is a long standing criticism, and Al Karnes was was quite scared thing about this just after he sat down about how the Ministry of Defence spends its money. And I would strongly agree with that. it's a Steve: It's not just just to interrupt and like you come from the Ministry of Defence, I come from an intelligence background. I would suggest that not spending in the smartest way is not something that is unique to the Ministry of Defence.
Dave: No, and no look, there's a whole th I mean, this is a whole other conversation around the the the way in which money is public money is spent. and yeah, there's a whole other thing there. So we're not we're gonna go down at all. So there's a bit of that. There's a bit of it'll be spent how it's spent, how you know it and it w it will be spent, you know, it will be used to do so. I think the bigger question of me is is is it's is it gonna sp buy the right things? and is it going to spent in the right in the right way in terms of the kinds of capabilities that are going to be going to be procured? Because it's always going to be a choice. You could always have another squadron of jets, or you could always have, you know, another warship if you had the money, or whatever whatever it might be, whatever, you know, whichever uniform or lobbying group or you know, industry body kind of gets their way. actually I think that it's more important. To say, are we making sensible judgments about what we think the future character of warfare is going to be? And I use that word very deliberately. And you might hear just very briefly, you might hear people like Dan Jarvis use the words the character of warfare. And there's a bit of a phrase, which I'm sure you've heard before, Steve, but but others might not, which is the nature of warfare never changes. The nature of warfare that is a violent human activity that is about.
Steve: Mm.
Dave: exerting your will on the enemy and whether you go to Sun Tzu or Close Fitz or whichever military philosopher, you know, they will all agree that the nature of warfare is unchanging, but the character of war absolutely changes.
Steve: Well yeah, it was it was so sorry, just just to interrupt. I it was von Klauschwitz that said war is a war is a continuation of politics by other means, right? So so it it is politics being played out just with with much more violent kind of means.
Dave: Yeah, exactly. Yeah, yeah. Yeah. So see yeah, so there's this really specific phrase where people say the character of war is changing. and I would argue that the character of war is changing at a pace now, enabled by technology that it probably never has before. So in short periods you know, of the Second World War and the First World War for that for that matter, you saw amazing innovations, you know, the tank, for example, the machine gun.
Steve: Yeah.
Yeah Dave: You know, things that changed, they did change the character of war and they changed it singularly overnight, but then there was a then an adaptation to that over a period of time. What we're seeing now is is that cycle is now in in days and weeks of new new technology adoption, changes in tactics, and then something else comes along straight after it. and that is all accelerated and accelerating.
Steve: Yeah.
Yeah. Dave: As AI becomes more and more sophisticated and more and more embedded. So I think like that is a roundabout way of saying I think that some of the themes that are emerging are are good ones. and then it remains to be seen how the sort of transformation in the Ministry of Defence, the defence reform project, which John Healy kicked off. One, does that survive contact with at least one change of defense secretary?
Steve: Mm.
Dave: possibly another one in a few weeks, who knows, whether assuming it's Andy Burnham will will keep will keep Dan Jarvis on or not. and then how that how that then is put into action to actually spend the money with defence industry and with maybe different kinds of defence companies. And again we can come back to that probably it's a good place to finish.
Steve: Well, I mean, that's really interesting, right? So there there's there's there's a bunch of things there. what you're saying is there's a thing about the amount of money, but there's also a thing about how you use that money and how you spend that money. And I and I think that's a really important point to make. and to highlight the fact that that the evidence suggests that we've not been great in the past at at kind of outlaying. taxpayers' funds in in in ways that are ridiculously effective. I've seen it work really well, by the way. It's not it's not all bad, right? but it's it's certainly that they're the case that there there's there's lessons that we can learn and we can always do better. I think Dave: Yeah, but we've also seen it done really badly as well. You know, if I just remember the pictures of £2.3 billion worth of Nimrod MRA fours being literally bulldozed because we decided to cancel that program at exactly the wrong point. you know, so so I think that that you know that that was a hard choice. but it resulted in a big capability gap for a long time and the waste of a lot of money.
Steve: Yeah. Yeah. Yeah, and that and that's, you know, there's there's all kinds of anecdotes about places where things can be better. And and I and I and I do want to point out that there are some good things, but there are certainly some bad things. I I guess what I'd say is I think that you you talk about the character of war, and I and I really like that phrase. I will say one of the one of the things that struck me over and over was how much the prime minister pointed to the lessons that are being learned in Ukraine. You know, he specifically highlighted the fact that Ukraine destroyed the Black Sea fleet without a navy of their own. And, you know, these these kind of really headline statements. I think the thing that I wanted to kind of take a moment to reflect on and and to to get your thoughts on are I always say that that Ukrainian security and Ukrainian defense is European defense. And I don't mean EU, I mean European defense. And the let you know, we we t we talk about lessons in these types of these types of press briefings, as if they're they're they're just like, we've we've we've read some papers and and we've learned some lessons. The reality is right now, in a very contested front line, Ukrainians are paying for those lessons with their blood and lives, right? Ukrainian heroes are are helping us to learn. the lessons and they're doing it with their lives and their and their society, right? And I you know, I I never want to to take away from the fact that, yes, we're learning lessons, but people are people are having to pay for those lessons in the hard way.
Dave: No, I think I think I think that's a really good point. and I heard something really interesting. I can't remember exactly what what forum it was in, but it was something talking about kind of defense tech founders and startups and investments and and I heard a really interesting phrase which was in fact to tell you was it was a DSEI last year. It was DSEI in September last year. and somebody said if you developed some kind of new, particularly uncrewed vehicle type technology. you're looking to sell it to NATO and it's not being used in Ukraine, forget it. Forget it. Because that's where things are being tested. And that's where the capability will will will will prove itself. Now there's there's a there's a really important point about about learning lessons, which is you've got to learn the right ones. And what we are learning in Ukraine is what land warfare looks like in 2026, what land warfare looks like in the information age, largely. you mentioned the the Black Sea fleet, that's absolutely a a fair point. And I and I think the Navy actually probably has learned some of those lessons. You know, this this pivot to a hybrid Navy recognition that you don't need lots of huge crude platforms to take on other crude platforms. You can do it in in very asymmetric ways. Great. Just put the put that to one side side because that is it is a bit it is a bit part. The whole thing. An important part, but it's a bit part. What what Ukraine really is is a land war between two peer adversaries, in a way that we have not seen at the scale since the second world war. So that's what we're learning about is what does that look like? That is not the only kind of conflict that that is that is gonna happen, or even arguably is happening right now. So what we mustn't do is become so focused on what is happening 50 kilometers either side of the l the front line in Ukraine, that it obscures everything else. I'm not saying that's what's happened at the dip at all, but but I think again, it's it's just learning that's part of the lesson. But there are a whole bunch of other lessons from Ukraine. Energy security is just such a huge one. And I mean that in a number of ways. I mean your access to a secure source of energy which you own and control, but I also mean the resilience of your energy network and your ability to defend it against Steve: Mm.
Yeah. Yeah. Dave: a whole range of threats from hypersonic missiles to cyber attacks to sabotage. and I'm I'm not convinced with everything I've heard this morning thus far. Again, caveat, not read the full text of the dip, that that it that it's gonna cover all that ground. It feels a little bit like, and I'm gonna be a little bit cynical here, I said earlier on about the delay of the dip. So broadly a year in development, John Healy fell on his sword, Al Collins fell his sword because they weren't convinced by it. They've then had approximately two weeks, I think, with Dan Jarvis in charge, maybe three maximum, but about two weeks, I think, to come up with a new dip which which has got much more of focus on on drones and and uncrewed systems, which which which is which is great. But my slight worry is there's a shiny Steve: Yeah.
Dave: headline deliverables and the analysis might not be as deep as it could be behind them, to ask the really difficult questions around what is it that we are defending against? what are we defending or what are we defending it against? because 'cause that's that's a really difficult question.
Steve: Well, and I think that's a really good segue to to get into the detail of of the form and format of the dip and and like what what it looks like. And and we'll cover that in a sec. What I will say is General Barrens, the the one of the authors of the strategic defense review last year, was on talking to the ever awesome Anna Foster this morning on Radio Four. And he I mean, he wasn't scathing. He wasn't he wasn't really kind of critical of it. He was just saying, in in his professional opinion, the the the composition and the overall headline numbers of the dip don't go far enough to to protect against the the nation as he laid out in he and others laid out in the strategic defense review last year. So it's I found that really interesting. but coming on to the composition point, again I'll just I'll I'll quickly go over the headlines. I'm just gonna look this way just because my notes are over here. So 8 billion for GCAP, the global combat era program over the next four years. That's the thing that we're doing with Japan and Italy. And if I had my way, Canada would be in there as well. sixty-three billion over the next four years for the nuclear deterrent. And I was really interested to hear there were a couple things here. One is Dreadnought, the the the the the future kind of nuclear deterrent submarine that we that we wanna launch, the SSN, but also a bunch of F thirty five A's. so different than the F 35s that are on the on the the carriers that we've got right now. So these are nuclear capable of you know dropping free free fall nuclear bombs. But also, and this was the one that I found really interesting, a new warhead, a a British-designed nuclear warhead. So so that was something. So there's there's 63 billion in there for that. There's 26 billion for revamping Dave: Mm-hmm.
Steve: Fazlane, Portsmouth, and Devonport, again, a real reflection of the fact that that the UK has a long history of having a fantastic world-class Royal Navy and we need to continue to invest in that. $5 billion over the next four years for that those drone transformation program of of the armed forces, which is what you mentioned. two billion for defense targeting web, sorry, digital targeting targeting web, something that I I think is really interesting. AI has gotta be featuring in that, although I would suggest that there are some lessons that we can be learning from Iran in this. 790 million over the next four years to protect overseas and UK bases from drones and missiles. And we're talking about directed energy weapons and counter UAVs and you know things like that. 11 billion on munitions. Sounds Dreadfully unboring or sorry, dreadfully boring and and unsexy. What I would suggest is that having fantastic world-class weapons platforms without anything to fire or drop is a pretty expensive exercise in creating paperweights. So so unsexy but but meaningful and and important. 900 million to drive efficiency and reform procurement. So that's I'm really interested to see what that.
Dave: Yeah.
Steve: is because that really then kind of comes to the point that you were making is that it's not just about how much, but how you spend it. and a hundred million for the Prime Minister's rapid AI delivery task force, RAID. That's a very American way of developing a an acronym for a for let's call it RAID and figure out what that mean needs to be in the back plane. So so those are the headline kind of compositional statements. I'm just curious to see what your thoughts are.
Dave: Well, so so I think I mean I think the majority of that would already have been in the plan. so I think there's something in the in the presentation of it that has been skewed because actually the first things that were announced were not maybe necessarily the biggest. So GCAP, you know, maybe it's the single biggest investment. I think there has been some of the probably the biggest single pivot that that has at least been sort of announced is the is the deletion of a replacement for the a direct replacement for type forty-five destroyer and a replacement with a a a selection of uncrewed uncrewed platforms to so called hybrid navy. I think that's a really good idea. I do. The one caveat I'll say is the type 45 is the most capable air defence capability we've got at the moment. Full stop. I'm not just talking about Marietta, I'm talking about anywhere. you know one credible air defence approach is to park a type 45 in the Thames. somewhere when you know that as far up up up as you can get it and then you know use that as an air defence platform.
Steve: This and and this and this is what they tried to do, this is what they tried to do in Cyprus when when there was thoughts that the Iranians were going to be lobbing all kinds of shahad drones at at Cyprus and and you know, we we need to get a type forty five there. Now, don't get me wrong, it took us a while to get it to get it there. But I think that was testimony to exactly what you're saying, right? The type forty five as a as an air defense platform is an incredibly capable platform.
Dave: Yeah, correct, yeah. Yeah. Yeah, exactly that. Yeah. But but I think w what I think what we're starting to get towards is recognition across all of the areas, whether it's the the autonomous I don't like the autonomous wingman, because that's that's not that's not the right word, but the collaborative combat aircraft. Yeah, colla collaborative combat aircraft I think is the best term, which will form Steve: Lo Americans call it loyal loyal wingman, the Americans call it any case. Yeah, yeah, that's it.
Dave: you probably broader air capability, whether it's the the maritime stuff I mentioned, whether it's the the various uncrewed platforms and land environment, I think is recognizing that it's not just about crude versus uncrude, it's about scale, it's about mass, it's about variation, it's about the ability to have everything from really small scale, really cheap, attritable throwaway platforms. You know, and let's not forget that the Ukrainians are using very small scale drones in their thousands. every day, you know, producing four million a year, four million drones a year, producing or consuming, right up to retaining some of those exquisite platforms that can do the highest highest end missions. So I think broadly that you know that feels a about about right. I think there'll be some things in there that people can get excited about, both positively and negatively. I'm sure that there'll be elements of the Navy jumping up and down that they're not gonna net get a new destroyer. I see Tom Sharp. who's r writing various papers, who I worked with a few years ago, top bloke, you know, he but he you know he's very, very much the dark blue line as you would expect for a former Royal Navy officer. I think he was, you know, saying broadly agreed to some of the decisions, but but there were other bits that that, you know, concerned him, which is to be expected. There's an element of is it right to be investing so much money in a single crewed air platform? I think, you know, while the Royal Air Force is run by pilots, then then that's you know, always gonna be an element of it, but that's a that's a whole other thing. but I think, you know, there's some good stuff in there. And I think where it's probably worth finishing then in the last couple of minutes is is talking about bit about what it means for for business and then maybe what it means for us specifically.
Go Steve: Well, before we Before we go there, I just wanted to to to state one thing that I am getting slightly excited about, and unfortunately it is in the negative, which I didn't see anything in there about cyber, either defensive cyber or the national cyber force. You know, the the program that we've been working very hard over the last kind of twelve to fifteen years to turn from a you know, early stage national offensive cyber program, which I I, you know, I I have a lot of history with personally, but also, you know, taking that and transforming it as it should as a change program into the the the artist that is now the national cyber force. And I haven't seen anything. Now again, I'm gonna come back to we haven't seen the full text of the dip yet. So hopefully there's something in there. But the SDR very clearly laid out that cyber has to be part of Both defensive and offensive cyber has have to be part of our future defense. And I'm slightly worried about the fact that nothing I've seen so far, either in the prime minister's speech, you know, alongside the chancellor and and the defense secretary, but also in the questions afterwards, you know, it wasn't picked up on. So that's only one thing in terms of composition that I'm slightly worried about. But let's see what the dip has to say in the full text.
Dave: Yeah, I think that's right. I mean I in the context of what is going to attract the public's attention, what is going to make headlines in newspapers, what is going to, you know, k catch the eye, catch the eye of the selector, as it were. I don't think cyber's it. I just 'cause I think it's too confusing, it's too ethereal. for for the for the for the majority of people, they don't they don't you can't you can't you can't stand in front of it and announce it. You can't, as the Prime Minister did, point to his left and to his right to the to the drones. that he was that was sort of flanking his position on the on the lectern. that you come with a cyber unless you're gonna point to a laptop.
Steve: You can, it's just it's just p pointing to some to some pimple faced kid named Simon. you know, like it probably doesn't probably doesn't have the same impact as s standing next to a drone, right? Yeah. Yeah, there's a Richard Iowa thing in there somewhere.
Yeah. Dave: is where we need an IT crowd sketch, isn't it? what's that? It's the internet. Yeah. yeah. so yeah, I mean I let's see what it comes out. I I do share your trepidation on that front, so we'll see if it comes out.
Steve: Yeah. Yeah. All right. So so sorry, I interrupted you. We we you were about to start talking about business. I mean, what what are you what are your thoughts on this?
Dave: Well, so I think I come back to my previous point about how the money is spent, right? So one of the issues which has ever been the case is the defence sector is a really hard landscape for SMEs. because risk appetite in government is generally low, whether it's commercially or or whatever else. complexity is high, risks on the business side are high. so it's it's it's it's been Steve: Yeah.
Dave: difficult historically. There's been a lot of statements around this recently, a lot of doing things like establishing the Defense Office for Small Business Growth, establishing Defense Innovation to kind of wrap in some of the disparate bits of the innovation ecosystem they've been around before, because we've done we've done some work with that through through Janus Allies and the Neta Diana work.
Steve: Yeah.
Yeah. Dave: But I still think it's difficult for business. So the the sort of headline statements around this idea of you're buy by British, invest in the supply chain of Kirst Arm specifically said, invest in startups and SMEs, great. I think we've we've got to see then what that looks like and the and the mechanisms of how that money is gonna flow. And the right answer can't be chuck a bunch of money at the primes and say to It'd be joy nice if you would spend some of this with the SME community. Because the reality is they do anyway, but but they do that by either putting big margins on some because they then transfer the risk out of government. they do it by acquiring innovative companies and folding them into their corporate machines so they get the capability, but maybe lose some of the agility and innovation. There has to be a better way of doing this. And you know, a good friend of mine, Blythe Crawford, Steve: Mm.
Dave: Now working at Tiberius Aerospace on the Grail platform. Again, we're doing some work with those guys. You know, there's some ideas there around defence as a service and ecosystems of small companies and really driving innovation that looks far more like kind of Silicon Valley software startup than it does traditional manufacturing Behemoth like BAE systems. So the reality is if you're gonna if you want a warship, you know, or you want a a Steve: Yeah.
Yeah. Dave: an aircraft with the complexity of Tempest, you're gonna have to go to Defense Prime because you know you don't want to but but we don't what we specifically said in this plan is it doesn't have to be all about warships and exquisite platforms. It's about it's about a mix. It's about the high, low mix as as Ruff and Bright Blythe would say. and in that area we have to get out there and spend this money Steve: Yeah.
Dave: with with startups, invest in new companies, create the environment such that such the new new entrants can get into the sector, get those innovative capabilities into the hands of the warfighters. Such a trite phrase, but it is correct. Because that for me is the lesson from Ukraine. That's the lesson that should we should be really thinking about. Not what it looks like immediately over the battle space and and and you know whether it's fiber optic or RF drones. Great. Those are all things that feed in. But the fundamental thing that is different in Ukraine is the cycle of development and the delegation of that development to a very, very low level because the reality is one unit operating one part of the front line has a very different requirement than one operating not that far away. And they just need the stuff right there today to help them. What they don't need is to write a requirements document that goes through years of scrutiny. before it eventually you know lands in a capability that's too late, too expensive and and no longer for the purpose. That's the key lesson.
Steve: Well indeed. But then the counter the counter argument to that is sure, but we need capabilities that are scalable, integratable, durable, right? Like so so it it's I mean it it this this is the this is the character that you are talking about, right? It's all of these things all mixed together into some hard choices that we're I think we're gonna have to be making over the next little while. Right. This r this risks running into a marathon if we if we keep going at this pace. And you could probably hear an aircraft taking off just over there. one of the joys of living in Gloucestershire is that Staverton Airport is just just over there. busiest, busiest general aviation airport in the United Kingdom, I'll have you know. Yep. Full of facts. None of them really mean anything, but right. let's end it there, Dave. it's been really fascinating talking to you about this. I think I think over the next little while it's gonna be interesting to see the full text of the dip. and yeah, the Dave: There you go, full full of facts.
Steve: I think for most people it probably is boring reading, but for us we're pretty excited to t to get our get our get our head around it and and see what the full text has to say. Because from a from a from a you know, a pr national security perspective, this is at least as if not more relevant than the S Dr last year.
Dave: Yeah, I think that's right. So we shall see what comes out in due course.
Steve: We shall indeed. Right. Well, thank you everybody for listening and yeah, apologies for the the slightly wayward format. Hopefully that worked for everybody. but we'll see you next time. See ya.
Dave: Yep, speak soon. Bye-bye.
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