Oliver Wyman report finds ‘Team UK’ approach can unlock defence-driven economic growth
08 July 2025
The Confederation of British Industry (CBI), in partnership with Oliver Wyman, has today (Tuesday 8 July) published a landmark set of recommendations from its Defence & Economic Growth Taskforce, outlining practical steps for how the UK government and industry can work in partnership to seize an opportunity to align defence investment with the national economic growth mission.
In a period of global uncertainty, the security of our nation is of primary importance. And with the UK committing to increasing spending as a proportion of GDP, the government and industry must act now to unlock the widest possible economic impact. Today’s report from the Defence and Economic Growth Taskforce outlines a bold vision for mobilising capital, talent, and innovation across government, industry, academia, and finance to achieve this ambition.
The Defence and Economic Growth Taskforce - headed up by Rain Newton-Smith, CEO and Lisa Quest, Managing Partner UK & Ireland, Oliver Wyman - and co-chaired by the Chancellor and Defence Secretary, was tasked with identifying how to mobilise and attract capital flows to maximise economic growth and productivity. With that explicit remit, it was designed to be additive to other government initiatives including the new cross Whitehall Defence Growth Board and the Defence Industrial Joint Council (DIJC)
Bringing together CEOs from across the defence and finance ecosystem, with secretariat support from ADS and PA Consulting, alongside wider industry and government input, the Taskforce has developed a set of recommendations that complement wider government policy including the Strategic Defence Review and the Industrial Strategy.
The report identified two cross-cutting foundational recommendations and four target outcomes.
Foundational recommendations:
- Strengthen the demand signal to the market: The Strategic Defence Review needs to be put into action by creating a 10-year Defence Investment Plan. This plan should clearly show what the government plans to buy and invest in, when it plans to make those purchases, and how much it plans to spend. This would give a strong and clear signal to industry, so contracts can be made quickly, while still allowing flexibility to adjust to changing defence needs.
- Reset and reinvigorate the national public dialogue to define and embed a cross sector ‘Team UK’ mindset and approach. A renewed national conversation is needed which must be led by government, industry, and academia to redefine the importance of defence as a driver of economic growth. To ensure spending directly supports domestic economic growth, an important principle of ‘Team UK’ should be to buy from companies generating value in the UK. Such a shift is vital to attract both capital and talent into the sector.
Target outcomes:
- Deploying defence spending as an economic force multiplier, with reforms to procurement and contracting.
- Improving the global competitiveness of UK defence firms through export support and international partnerships.
- Mobilising private sector investment, including pension funds and asset managers, to unlock new financing models.
- Attract finance to shape a UK defence supply chain that is resilient and aligned with government priorities.
These recommendations build on recent policy announcements including the Strategic Defence Review, Spending Review, and NATO Summit outcomes, and are designed to inform the forthcoming Defence Industrial Strategy.
The Taskforce is made up of the following:
- Aimie Stone, Chief Economist, ADS Group
- Kata Escott, UK Managing Director and Head of Country, Airbus Defence and Space
- Marc Wietfeld, CEO & Co-Founder, ARX Robotics
- David Lockwood, CEO, Babcock International
- Charles Woodburn, Group CEO, BAE Systems
- Matt Hammerstein, CEO, Barclays UK Corporate Bank
- Dom Cartwright, CEO, Beaufort
- Raoul Hughes, CEO, Bridgepoint Group
- Rain Newton-Smith, CEO, Confederation of British Industry
- Ned Baker, UK Managing Director, Helsing
- Ian Stuart, CEO, HSBC UK Bank plc
- Kerry Baldwin, Managing Partner & Co-Founder, IQ Capital
- Rob Hales, Managing Director of James Fisher Defence, JFD Global
- Charlie Nunn, Group CEO, Lloyds Banking Group
- Andrea Rossi, Group CEO, M&G plc
- Paul Thwaite, Group CEO, NatWest Group
- Lisa Quest, Managing Partner UK & Ireland, Oliver Wyman
- Pete Lovell, Global Head of Defence and Security, PA Consulting
- Andy Briggs, Group CEO, Phoenix Group
- Rebecca Richards, Deputy CEO, Rheinmetall UK, Rheinmetall VSI
- Ricardo Mendes, CEO & Co-Founder, Tekever
- Dave Palmer, General Partner, Ten Eleven
- Ian Stuart, CEO, HSBC UK
Rain Newton-Smith, Chief Executive, CBI, said:
“This is a pivotal moment for the UK to align its world-class financial services with its defence ambitions. By working together as ‘Team UK’, we can unlock investment, boost productivity, and secure our economic and national resilience for generations to come.
“We live in a precarious world where our peace and security is being tested. Enhancing our national security is vital, and the government’s commitment to higher defence spending is a key part of this. But at the same time, we must ensure this additional spending supports the UK’s growth mission with lasting impact on our productivity and innovation.
“The UK’s defence and financial services industries are powerhouses behind the UK economy. Rightly identified in the recent Industrial Strategy as two of the eight growth-enhancing sectors, it is vital these sectors drive wider economic growth, revitalise our supply chains and maximise their contribution to our innovation ecosystem to turn the dial on growth.
“With a rapidly changing global landscape, the recommendations in our report offer a generational opportunity to build on the country’s success story to unlock the long-term sustainable and resilient growth businesses and households need.”
Lisa Quest, Managing Partner UK and Ireland, Oliver Wyman:
“The UK defence industry plays a critical role in protecting the nation, and contributes significantly to the country’s security, creating employment, and driving financial prosperity and economic growth.
“As the UK looks to build more independent resilience and accelerate growth, capitalising on the strength of its world leading sectors is key.
“With some of the most advanced and sophisticated financial markets, the UK is uniquely positioned to demonstrate how the financial services sector can bolster growth in defence spending, particularly at a time when NATO allies commit to allocating 5% of GDP to national security.
“The Defence & Economic Growth Taskforce has identified achievable opportunities to further stimulate growth and productivity at the nexus of private and public sector investment and improved dialogue, paving the way for greater stability and security, and ensuring the UK is prepared for long-term resilience.
“Crucial to the success of this initiative is the alignment of private sector spending throughout the entire supply chain to unlock the accelerated flow of capital”.
Aimie Stone, Chief Economist, ADS Group:
“The defence sector currently employs over 180,000 people, delivering £15bn in value to the UK economy, with both figures growing two thirds in the last decade. The UK defence sector has the potential to be the UK’s most powerful growth engine, but only with the right financial, regulatory, and political support behind it. As the trade association for the defence and security sectors, we're committed to working alongside the financial industry in advocating for a whole-of-society approach for defence financing moving forwards. This taskforce report is the latest marker in the sand for our sector that is already delivering intense social dividends on the government’s growth mission."
Peter Lovell, Global Head of Defence and Security, PA Consulting:
“2025 marks an inflection point in the UK’s defence posture, as our capabilities evolve in response to global threats. But to truly bolster UK defence and position it as national growth driver, we need a new approach – not only to defence acquisition, but also to financing and investment. I am delighted to have contributed to the Taskforce’s latest recommendations, with PA acting as a secretariat. From near-term quick wins to longer-term structural reforms, these recommendations build on the government’s policy direction and can help inform and shape the upcoming Defence Industrial Strategy.”
Kata Escott, UK Managing Director & Head of Country, Airbus Defence and Space:
“A robust national industrial base and a strong economy are crucial for our collective deterrence. These recommendations will grow the economy and keep us safer. We look forward to driving their delivery - private and public sectors working hand in hand.”
Marc Wietfeld, CEO & Co-Founder, ARX Robotics:
“This Taskforce roundtable marks a pivotal moment in forging a true ‘Team UK’ approach to defence innovation. As a European leader in uncrewed systems, ARX Robotics UK is proud to support a strategy that aligns economic growth with national resilience. We welcome the Taskforce’s bold push to unlock private capital and speed up procurement – these are the steps that will turn ambition and strategy into operational advantage, at home and abroad.”
David Lockwood, CEO, Babcock International:
“The UK has a once-in-a-generation opportunity to lay the long-term foundations of economic growth by backing British companies. Our defence industry doesn’t just help keep the UK safe, it supports thousands of high-value jobs for people in communities across the country. We look forward to continuing to collaborate to unlock further investment, to drive continued change and prosperity across the UK”.
Charles Woodburn, Group CEO, BAE Systems:
“We know that defence spending does more than safeguard national security — it also fuels economic growth and creates employment and opportunities in communities across the UK. We welcome the recommendations in this new report and look forward to working with our customers, suppliers, and partners in a ‘Team UK’ approach that ensures we are investing in the sovereign skills and capabilities to put the defence dividend into action.”
Matt Hammerstein, CEO, Barclays UK Corporate Bank:
“We are privileged to serve thousands of companies that help make the UK secure. Mobilising the capital, talent and innovation, within those firms and across the broad supply chain they represent, will not only improve that security, but also create a powerful engine for economic growth and reinforce the UK's global competitiveness. This report sets out how collaborative action will enable that, and we look forward to playing our part fully.”
Dom Cartwright, CEO, Beaufort:
“Aligning Defence procurement more closely with UK industrial capability is essential. When we recognise the full economic value, through skills, innovation and resilient supply chains, we not only deliver greater returns at home, but also build the credibility and capacity UK companies need to compete globally.”
Raoul Hughes, CEO, Bridgepoint Group:
“Strengthening the UK’s defence capabilities and broader industrial resilience should be a common responsibility and private capital can be a critical enabler in that effort, particularly in helping small to mid-sized firms scale.
With the right framework in place, there is real potential to attract long-term international capital to support innovation, job creation, and resilience in the UK and Europe’s critical defence efforts”
Ned Baker, UK Managing Director, Helsing:
“Helsing is accelerating its UK investment to fulfil the £350m Trinity House commitment and start sovereign manufacturing of our AI-enabled defence technology. We support the Government’s ambition and welcome its adoption of the Task Force recommendations. The ‘defence dividend’ will be realised when public spending incentivises private investment – capital follows contracts – so we must accelerate them both to improve our warfighting readiness and grow the economy.”
Kerry Baldwin, Managing Partner & Co-Founder, IQ Capital:
“Unlocking billions of private investment in Defence isn’t just an economic imperative—it’s a strategic necessity.
Expanding private capital flows will be vital to driving growth, increasing productivity, and strengthening the UK’s security. The Taskforce has worked collaboratively across broad stakeholders to set out clear recommendations to remove the remaining barriers to unlock investment capital across a range of exceptional opportunities across the UK. This will empower venture capital funds to continue to invest in the most innovative technologies and increase adoption to secure our technological edge over adversaries, while later-stage capital and debt finance will reinforce supply chain resilience and build critical infrastructure for the future.”
Rob Hales, Managing Director of James Fisher Defence, JFD Global:
“The Taskforce report sets out the generational opportunity to deliver defence advantage to the UK and its international partners, while creating high-quality jobs through growth. The UK has a world-class defence industry, and our Armed Forces are globally respected. As a mid-tier specialist with engineering, manufacturing and services hubs in Aberdeen, Glasgow and Portsmouth, we are looking forward to delivering on the Taskforce agenda, for our customers in the UK and around the world.”
Charlie Nunn, Group CEO, Lloyds Banking Group:
“We are proud to support the UK’s defence sector, from major manufacturers to the SME supply chains that underpin national capability. Our specialist teams provide the financial solutions that enable innovation and growth – helping businesses expand capacity, deliver on contracts and support skilled employment across the UK. This report sets out a clear agenda for how government and industry can work in partnership to align defence with the UK’s broader economic growth ambitions.”
Andrea Rossi, Group CEO, M&G plc:
“As a major global investor, with £100bn invested in the UK, we understand the important role the defence sector plays in protecting national security interests. By backing British defence we can create jobs, promote innovation and skills, and crucially send a confident signal to global investors that the UK is pro-growth and serious about delivering long-term value. This report does exactly that.”
Paul Thwaite, Group CEO, NatWest Group:
“As Britain’s biggest bank for business, NatWest is proud to work alongside our defence industry. Collaboration between financial services and defence is vital in driving innovation, resilience and economic growth, as this report recognises. By mobilising capital and encouraging collaboration across sectors, we can help ensure that defence spending delivers economic value for communities and businesses across the country.”
Rebecca Richards, Deputy CEO, Rheinmetall UK, Rheinmetall VSI:
“A unique taskforce that met weekly, moved fast and stayed focused, I am proud to be part of the team that have rapidly shaped the response and we at Rheinmetall are committed to turning the recommendations into results. Rheinmetall's continued investment in the UK of £120m+ is strengthening our sovereign capabilities and growing industrial footprint.”
Ricardo Mendes, CEO & Co-Founder, Tekever:
“Defence and economic growth are deeply interconnected, and this report highlights how a long-term, strategic approach can unlock innovation at scale. At TEKEVER, we’ve seen first-hand how collaboration between government and industry can accelerate the delivery of sovereign capabilities, create high-value jobs, and strengthen the UK’s position as a global hub for cutting-edge autonomous systems. Through initiatives like OVERMATCH — our first major UK programme and part of a £400M investment creating over 1,000 high-skilled jobs — we’re proud to contribute to building a stronger, more resilient defence ecosystem.”
Dave Palmer, General Partner, Ten Eleven:
"The most vital thing a startup needs is customers. The taskforce recommendations on simplifying the processes for buying products and services from defence-focussed startups are welcome and will lead to new jobs as well as faster adoption of innovations for our military forces."
Ian Stuart, CEO, HSBC UK:
"As the UK’s international bank, we’re proud to support many of the county’s most innovative companies, connecting them with opportunities across the world. The defence sector is key to both our national security and the UK’s future economic growth. We’re pleased to contribute to the work of the Taskforce and stand ready to support our customers’ ambitions to grow."
The report’s findings are set out in more detail below.
There are two foundational recommendations which are cross-cutting:
- Strengthen the Demand Signal to the Market
The Taskforce calls for a transparent and detailed 10-year Defence Investment Plan that outlines:
(i) what the government plans to buy and the capabilities it intends to invest in,
(ii) when these investments will occur, and (iii) how much funding will be allocated. Improved visibility is essential to stimulate accelerated investment and build confidence across the sector.
The demand signal and investment plan should be provided at the highest level of granularity which maintains the highest possible reliability to guarantee commitment to spending. This could be further supported by the creation of a UK defence industry problem book.
- Reset and Reinvigorate the National Public Dialogue
A renewed national conversation is needed to embed a cross-sector ‘Team UK’ mindset.
This effort must be led by government, industry, and academia to redefine the importance of defence as a driver of economic growth. Such a shift is vital to attract both capital and talent into the sector.
In addition, there are four further target outcomes which are as follows:
- Deploy UK Defence Spending as an Economic Force Multiplier
Immediate clarity is needed on the roles and responsibilities of government departments and public bodies in identifying and scaling dual-use opportunities for UK Intellectual Property (IP). Longer term, procurement and contracting processes must be reformed to ensure sustainable growth and resilience. Embedding the ‘Team UK’ mindset throughout the procurement lifecycle, including recognition of economic value in award decisions, is central to this vision. - Improve the Attractiveness and International Competitiveness of Defence-Related Companies.
The rapid implementation of Strategic Defence Review commitments, including the establishment of a new Defence Export Office, is essential. Confidence will also be bolstered by a detailed delivery blueprint for the Defence Industrial Joint Council (DIJC) and the Defence Investors Advisory Group (DIAG). International partnerships will be key to expanding market access for UK firms. - Mobilise Trusted Private Sector Investment
UK financial institutions should reassess potential due diligence exclusions related to defence. There is a clear opportunity for government and the private sector to collaborate on innovative financing and service delivery models. In the long term, the UK should position itself as the global hub for defence investment and financing. - Attract Finance to Build a Resilient and Government-Aligned Defence Supply Chain
Short-term priorities include confirming Defence Growth Deals and investing in talent and skills. Longer term, stakeholders must work together to enhance supply and value chain finance, including programmatic solutions and improved working capital mechanisms.