MOD: ‘Formidable’ UK defence to create opportunities

mod_signThe MOD has said that the UK’s defence forces are ‘formidable’ and that cuts to budgets have not affected military standards or capabilities, predicting new opportunities for those eager to grow their business in the defence industry.

£160bn defence equipment spend

In its statement, the MOD said: “Over the next decade, we plan to spend £160bn on equipment, to ensure our armed forces retain their formidable range of cutting-edge capabilities and ability to project power across the globe, including by maintaining our major naval presence in the Gulf Region.

“Construction of the first new aircraft carrier, the largest ship the Royal Navy has ever operated, is almost complete and the navy will also operate state-of-the-art Type 45 destroyers, new Type-26 Frigates, and seven new Astute Class submarines.”

Former Defence Secretary Liam Fox said that Britain was “one of only four or five countries inside NATO” to meet the target of spending 2% of GDP on defence.

He added that while America is the world’s biggest economy with the world’s biggest defence budget, the UK is currently the world’s eighth biggest economy with the fourth biggest defence budget, calming fears that standards had slipped.

UK defence capability

The statements from the MOD and Liam Fox come after former US defence secretary Robert Gates claimed that cuts to the UK’s armed forces will limit the country’s ability to be a major player on the world stage.

Speaking on the UK’s defence budgets recently, former US defence secretary Robert Gates had suggested that the squeezed budgets would limit UK defence capability and would mean that the UK could no longer be considered a full military partner with the US.

Mr Gates said: “With the fairly substantial reductions in defence spending in Great Britain, what we’re finding is that it won’t have full spectrum capabilities and the ability to be a full partner as they have been in the past.”

The statement comes a month after the UK’s top military officer said that the cuts meant that the military had the right equipment but not the personnel to operate it.

General Sir Nick Houghton, Chief of the Defence Staff, said the structure of the army, navy and air force were “critically deficient” in crucial areas, particularly in terms of manpower.

Under the government’s plans, by 2020 the Army will lose 20,000 personnel, the Royal Navy 6000 and the RAF 5000.

battleshipCuts to budgets have also affected the Navy’s capabilities. At present the UK has no operation aircraft carrier, and just weeks ago the Navy scrambled to respond to a Russian ship entering Scottish waters. A lack of ships based in Scotland due to defence cuts meant that the closest warship, HMS Defender, took 24 hours to reach the ship after sailing from Portsmouth.

Finding defence opportunities

With budgets under scrutiny, organisations looking to do business with the MOD and other public sector bodies have to make sure they gain full visibility of all the opportunities available to them.

MOD Defence Contracts Online is your gateway to additional defence opportunities in 2014.

Last year businesses like yours had access to over 202,600 defence contract opportunities with Defence Contracts International (DCI), including contracts from: aerospace, aviation, homeland security, counter terrorism, emergency services and humanitarian aid.

Defence Contracts International is the largest contract tender awards database in Europe.

Many public bodies have requirements that your business could fulfil, including those in the MOD and outside the defence and security sectors − a further opportunity to grow your business.

Click here to find out more about defence and civil contract opportunities on offer today.

MOD DCO Webinars – a new way to win more business

Webinar screen | MOD DCO2013 has been an exciting year for MOD Defence Contracts Online (MOD DCO) as we kicked off our new webinar Success programme. MOD DCO registrants have been:

Exploring how the MOD are helping suppliers and SMEs;
Discovering where the MOD are planning to spend £160bn;
Learning how to optimise their MOD DCO profile to help them win more business; and
Asking our Defence Contracts Sourcing Experts their questions.

Register today by selecting a date below to secure your place in our next winning webinar (below).

Previous Webinar Q&A – 28 November 2013

We welcomed MOD DCO registrants looking to learn how to win more business. Attendees were given the chance to ask their questions and have them answered by our experts, some of which are detailed below.

Q: Are there SME-specific opportunities available from the MOD’s £160bn spend plan?

A: Yes – the MOD have announced that 15% of their annual spend will go to SMEs by 2015 either directly or indirectly.

To find out about these opportunities first it is essential that you have registered your business on DCO and also have your profile set up correctly.

Q : How often should I be updating my MOD DCO alert profile?

A: We recommend updating or reviewing your profile on a regular basis to ensure you are not missing out on any new contracts. Use both keywords and CPV codes where possible. If you require any help or advice when reviewing your profile you can contact our experts by emailing

Q: If there is no CPV code for what we do, how can we quickly search for our product?

A: Keywords are just as powerful as CPV codes. Your alert will show all contracts, backdated by three months, that contain your keywords anywhere within that contract.

Register today to join the conversation.

With only a limited number of places available, click below and register today to avoid disappointment.

Are you ready to win more business with MOD DCO in 2014?

MOD DCO WebClinic: Create a Winning Alert Profile 1st December 2020 - 11:00

DCI WebClinic: How to Find and Win New Defence and Civil Business 8th December 2020 - 11:00


NDI Collaborating for Growth conference

NDI Conference | MOD DCOCollaboration is important for growth. The act of sharing knowledge, learning and building consensus is often heralded as imperative in establishing best practice, new opportunities and promoting growth.

Collaboration is important across the whole supply chain, from Primes to Tier 4 contractors. The NDI conference, held on 5-6 March at The Point, Lancashire County Cricket Ground, Manchester, brought together businesses of all sizes to discuss how SMEs can grow for the benefit of both the country and the defence industry. SMEs are a valuable link in the supply chain, employing 13 million people in the UK, and in 2012 40% of new MOD contracts – work worth over £1bn – were placed with SMEs. The NDI Conference, Collaborating for Growth, ran three breakout sessions – Growth through International Trade, Growth through Business Excellence and Growth through Investment & Finance – to discuss the key issues affecting the growth of SMEs.

Philip Dunne, Minister for Defence Equipment, Support and Technology spoke at the event. He said:

“The existence of a strong, diverse supply chain and the vital role SMEs play in nurturing science and engineering skills combine to provide the innovation increasingly relevant to the UK’s defence needs of the 21st century.

“I am fast becoming a strident champion of SMEs working in the defence sector.”

Mr Dunne chairs an SME forum that meets three times a year to discuss the issues specifically affecting SMEs working in the defence industry. The Minister said that the MOD is keen to get SMEs involved in the supply chain, whether directly or indirectly through Prime Contractors. An example of this is the push for transparency by the MOD through the early publication of the ten-year Defence Equipment Plan and upcoming publication of the DSTL plan for investment, which will allow SMEs to plan ahead and potentially be part of the opportunities that will become available.

Mr Dunne also said:

“A vibrant UK defence industry including manufacturing, servicing and exporting is a vital part of our strategy of rebalancing the economy so we can return to sustainable growth.”

Exports play an important part in creating growth and this was a central theme at the conference. Mr Dunne made it clear that defence exports are firmly back on the agenda and said that ministers will lead delegations that include SMEs to other markets in order to help dialogue in places of growth like Brazil. He said:

“We want to help you to maximise your access to overseas markets.

 “We recognise that most defence budgets are under pressure and we want to support you in penetrating markets where there is growth, such as the Middle East, Far East and South America.

“Promoting defence exports is a core part of the MOD’s commitment to the Government’s growth agenda. We will increasingly focus our engagement with prospective partner and customer nations in a way that helps you demonstrate to them the value of long-term equipment support.”

He offered the sale of Typhoon jets to Saudi Arabia of an example of opportunity that filters down the supply chain. Mr Dunne encouraged trade associations, money permitting, to form relationships with similar associations in other countries to help promote growth and exports. He said: “Working together on exports provides the opportunity to reduce the costs of the equipment programmes for UK forces. Export customers can help to spread the costs of development programmes, or the fixed assets needed for long-term support and allow government to recoup some of its investment through the use of export levies.”

“Exports can form an essential element of our defence engagement initiatives.”

There were extensive discussions about exports at the Growth through International Trade breakout session. The UK won £8bn new overseas business across Defence and security in 2011 and it is important for the UK’s exports to grow in order to counteract fiscal pressures at home. Speaking during this session, Keith Venables, Business Development Director, UK Trade and Investment Defence and Security Organisation (UKTI DSO), said: “The UK’s reputation, particularly SMEs, is a strong factor in exporting success.”

He said that businesses have to face up to the reality that defence budgets are being squeezed in Europe and the United States so UKTI DSO has established priority markets, for instance in the Middle East in countries including Saudi Arabia, UAE, Oman, Kuwait, Qatar and Libya, where there is significant business to be won. He said growth is coming from the SME sector and that the players in the export market are changing – those who weren’t exporting in 2006 are leading the way now, while the biggest exporters in 2006 have lost £2 billion worth of exports.

Philip Doyle, Manager, Aerospace and Defence Europe, Government of Victoria, Australia, agreed that static markets in Europe and growing opportunities elsewhere may mean foreign markets may be a better way to grow a business in this economy. He was at NDI promoting business opportunities for UK companies in Victoria, and suggested building relationships and growing a market presence in the market of choice. Collaborating with a business from another market can open up opportunities in both countries.

Warren Bayliss, Assistant Head, International Relations Group, Defence Equipment and Support (DE&S), Ministry of Defence, presented the potential benefits of the US-UK Defence Trade Cooperation Treaty, which came into force in April 2012. The Treaty is extremely attractive to SMEs as it gives an exemption from International Traffic in Arms Regulations that have been found to slow down business with the US. The Treaty makes business faster, gets equipment to the UK Armed Forces more quickly and strengthens the UK’s trade relationship with the USA.

To take advantage of the Treaty, SMEs are urged to be part of an approved community; this takes six months to join and there is a vetting process. However, once a business is part of the community, the US Government will trust it and like to do business with it.

Session Two was called Growth through Business Excellence and was led by John Terry, Director of Argent Vulpes Ltd. The message behind this session was the importance of business excellence at every level in the supply chain, as well as at every level within a business. Every business in the supply chain expects business excellence from those both above and below them in the supply chain.

The one thing that Mr Terry was keen to point out was the importance of the SC21 Awards – a change programme designed to accelerate the competitiveness of the aerospace and defence industry by raising the performance of its supply chains. Having an SC21 Award improves a business’ reliability, especially if it is an SME.

Mr Terry was followed by Dr Derek Ford, Senior Industrial Fellow, IfM Education and Consultancy Services, who said businesses should prioritise their resources. He said: “Companies that exploit their core competencies do better than those who don’t.”

It is important for a business to understand its core strengths and where its priorities are to grow but Lynn Tompkins, UK Operations Director of Semta, pointed out that skills also grow businesses. She said that some SMEs are doing very well by investing in skills as it is another important element of business excellence.

Session Three was Growth through Investment and Finance, led by John Bell, Aerospace and Defence Director, Barclays Corporate Banking. The session looked at ways to fund growth through both traditional and non-traditional methods. Mr Bell was keen to promote making use of grants and subsidies, saying: “I seem to come across a new grant or growth initiative every day.”

Some interesting approaches to funding include collaboration between buyers and suppliers and joint venture bank accounts. Banks provide free advice and knowledge to businesses and Mr Bell said that not enough SMEs make use of this advice.

He urged businesses to check their eligibility for Government grants and schemes, such as the Funding for Lending Scheme, Regional Growth Fund and the Business Growth Fund, as well as checking with agencies and trade associations for possible assistance. He also suggested that SMEs should request a trade review from banks and access research by banks on markets, funding option and clients.

Chris Kirby, Managing Director of Magnomatics, was up next and passed on his first-hand knowledge of the difficulties of finding funding. He provided a very informative and hard-hitting insight on the peaks and pitfalls of searching for funding. Preparation is key in gaining investment as is networking and using the right options out of the range available to businesses.

The important lessons to take away from this event are that help is available and best practice will always heighten a business’ chances of success. Defence, including defence exports, offer opportunities for SMEs within the supply chain and are an important part of the Government’s Plan for Growth

UK marine: open to export

UK marine | MOD DCOBusiness Minister Michael Fallon recently unveiled a joint Government and industry led plan to enhance the global competitiveness of British marine business in a bid to deliver growth in the industry. MOD DCB examines the latest developments in the drive to support the UK marine sector’s export performance.  

Speaking at the Tullett Prebon London Boat Show in January, Minister of State for Business and Enterprise Michael Fallon commented on the opportunities for British exports in the marine sector in markets such as China, Brazil and South Korea and how the sector must take advantage of these opportunities.

The UK Marine Export Strategy, commissioned by the Marine Industries Leadership Council, of which Mr Fallon is Co-Chair, details those sectors of the marine industry which could benefit from greater exports and makes several recommendations as to growth opportunities to improve exportability outside Europe.

The report covers four areas of the UK marine sector: Leisure Marine, covering boat and yacht building, superyachts, small commercial workboats and associated equipment services; Commercial Marine, covering shipbuilding, ship repair and associated equipment and services, marine science and technology; Energy, covering marine-related platforms, products and services for the oil and gas and offshore renewable industries; and Naval Defence.

Commenting on the report, the Minister said: “What we can do with this evolving strategy is build the foundations for the future of the British marine industry. It forms part of our wider Industrial Strategy, which is planning the long-term success of British business. A wealth of growth opportunities exist in the global marine sector that can benefit the UK economy.

“However, as this report highlights, UK companies face challenging conditions, particularly in more traditional markets like the European Union, which is why bigger opportunities lie further afield.”

The report also details Prime Minister David Cameron’s announcement of the National Export Challenge in a bid to get an additional 100,000 UK firms exporting, and Chancellor George Osborne’s target of more than doubling the amount of UK exports to £1 trillion by 2020.

Commenting on the National Export Challenge, UK Trade & Investment (UKTI) said it will take some years to recover from decades of poor trade performances. However, the organisation has already made progress in tackling these issues including being on target to double the number of small and mid-sized businesses they help to 50,000 a year by 2015.

A spokesperson for UKTI said: “UKTI received additional funding in the 2012 Autumn Statement to boost our support for SMEs looking to export. The funding will enable us to launch a voucher scheme for up to 2500 high-growth SMEs to target emerging markets.”

Following his announcement of the National Export Challenge, the Prime Minister commented on the growth of British exports when he released a statement on the UK’s current economic performance. In the previous three years, exports to countries such as Brazil and China, where Michael Fallon has highlighted an opportunity for growth for the marine sector, have significantly increased.

The Prime Minister said: “Over the past three years our exported goods to the fastest-growing parts of the world have been soaring – Brazil, up by half; India, more than half; China, almost doubled; Russia, up by one hundred and thirty three per cent.”

In order to encourage even greater export success, UKTI provides a wide range of services to enable UK-based companies to stimulate international interest in their business. A UKTI spokesperson said: “Our global network provides tailored advice and information on business opportunities and projects, including high-growth markets, and UKTI provides support for more detailed market research.”

Navy | MOD DCOOne particularly useful resource is the ‘Open to Export’ online community. The Open to Export service is delivered by hibu (UK) Ltd, in partnership with UKTI, and is intended to support small and medium-sized enterprises looking to export from the UK. The website provides a wealth of advice and information from a host of mentors on exporting products and services in the form of opportunities, events and articles. The website also offers a Q&A service where users can obtain advice on export queries.

UKTI has taken a campaign approach to winning major international business. This has not only been successful in defence, but also in non-defence sectors such as marine. UKTI’s High Value Opportunities (HVO) programme is an important feature of this new campaigning approach. HVOs cover overseas opportunities worth at least £250 million and which are expected to generate major supply chain opportunities for SMEs.

Commenting on the HVO programme, the UKTI spokesperson said: “UKTI’s global network of staff at embassies and consulates gather early and exclusive information and intelligence on high-value projects where UK businesses have a good prospect of achieving significant business success. Our staff in the UK develop a targeted campaign around each HVO designed to help maximise the chance of UK business success.”

According to the UK Marine Export Strategy, Brazil is the most important market in terms of demand for marine projects. One particularly successful marine HVO is the Petrobras HVO in Brazil’s offshore energy sector which has had early success with GE Power Conversion’s offshore business based in Rugby. This has seen contracts signed valued in excess of £385 million for pre-salt oilfield expansion off Brazil’s east coast.  General Electric’s systems will power, propel, navigate, position and control drillships and support vessels, as well as powering and controlling the drilling process itself. The company will in fact design and build systems for no fewer than 22 of the 29 drillships working on Petrobras’s Brazilian oil and gas exploration projects.

At the moment, the UK marine sector is being jointly appraised by Government and industry. The UKTI Marine Sector Advisory Group (MSAG) and the Marine Industries Leadership Council, along with the Department for Business, Innovation and Skills (BIS), are compiling a report due to be released in May this year which will assess the relative strengths of UK exports. UKTI is working with BIS to gain insight into the export market and to further analyse trade statistics data.

Commenting on the upcoming report, the UKTI spokesperson said: “We expect this work will help us to identify more clearly the relevant export strengths of the different marine sub-sectors. This will greatly assist our staff who continually monitor business opportunities for large projects that could be transformed into a High Value Opportunity.”

For further information or to download the report visit:

Winning in the marketplace: CDE helps innovators enter the defence supply network

Cubewano at CDE MarketplaceThe Ministry of Defence’s Centre for Defence Enterprise (CDE) provides proof-of-concept research funding for novel ideas that have a potential defence or security application. CDE, which is part of the Defence Science and Technology Laboratory (Dstl), aims to attract new science and technology providers into defence by funding short projects. Now, via the new CDE Marketplace initiative, it aims to provide further opportunities for small and medium-sized enterprises (SMEs) by highlighting successful projects to some of the world’s biggest defence companies.

The CDE Marketplace launch event took place in Westminster, London on 3 December 2012 and gave SMEs and academic researchers a unique opportunity to engage with big business and pitch their innovative ideas and technology that could be used by the Armed Forces in the future.

Eleven SMEs were joined at the Queen Elizabeth II Conference Centre by researchers from two of the country’s leading universities – University of Bristol and University of Lancaster – who have all successfully completed CDE-funded projects.

Among the technologies on show at the event were a ‘morphing wing’ from Blue Bear Systems Research Ltd, which is based on the dynamics of a bird’s wing, designed to enable the next generation of Unmanned Aerial Vehicles (UAVs) to be faster, more agile and have greater stability and duration; and an ultra-portable multi-fuel generator to power electronics in the field from Cubewano, where the final product is expected to be capable of running on both petrol and heavy fuel (diesel) and could eliminate the need to carry charged batteries into theatre.

Blue Bear at CDE MarketplaceDr Yoge Patel, Chief Executive Officer, Blue Bear, said: “The funding and support we get from CDE has been the lifeblood of Blue Bear’s innovation.”

Craig Fletcher, Managing Director of Cubewano, commented: “CDE funding enabled Cubewano to pursue development of a new market based on its current technology; this new market is expected to be over ten times the size of our original market with a large export potential.”

Minister for Defence Equipment, Support and Technology Philip Dunne MP opened the Marketplace launch event, saying: “CDE’s Marketplace provides a shop window for SMEs in the most practical sense, helping those which have received research and development funding from the MOD to access their full potential for commercial applications in the UK defence sector and the export market.”

Jono Byrne, Head of the Centre for Defence Enterprise, said of the event: “We have broken fresh ground in developing the Department’s engagement with SMEs and academia. Over half of CDE’s contracts go to SMEs and academia and it is vital that we are able to bring these CDE-funded innovators, their ideas and capabilities into the defence supply chain.

“We are delighted with the response and support we have had from Prime Contractors, as they too understand the benefits such a concept can bring. This is only the start for the CDE Marketplace, and like all good innovation I look forward to further improvement, for example, making use of online tools and involving investment companies as well as defence companies.”

Mike Kurth, Managing Director of Boeing Defence UK, said: “We see the CDE Marketplace as a fantastic opportunity to engage with SMEs that have relevant innovation and technology for potential work in the future.”

Steve Elwell, Business Development and Commercial Director at BAE Systems, said: “The CDE Marketplace concept provides an opportunity for a much richer engagement between industrial Primes and SMEs aimed at exploiting innovation for the benefit of UK Armed Forces and our economy as a whole. The Marketplace is an area in which BAE Systems intends to engage, seeking innovative solutions to some of the most demanding and complex challenges facing our Armed Forces today and in the future.”

Since the CDE Marketplace launch event last December, CDE has been revisiting all of the companies involved and gathering their feedback. This is helping to shape how this potential exploitation route will develop in the future. Initial feedback has been very positive, from both the defence Primes and the exhibitors. Although it is still early days since these first introductions took place, CDE has received reports of follow-up meeting requests from Primes to the exhibitors and also possible collaboration opportunities being identified between CDE Marketplace exhibitors.

CDE is committed to finding new, revolutionary ideas and working to make them a reality in the future. There are two potential routes for innovators to receive CDE funding: the Defence Open Call and a series of Themed Calls. The Defence Open Call is continually open and seeks exceptionally innovative research proposals that could potentially have a high impact on future defence capability. Themed Calls are held regularly and address particular defence and security challenges, usually identified from within current R&D programmes. These calls are bounded in terms of the timescale for proposals to be submitted and the budget available to fund successful bids. Recent Themed Call subjects have ranged from ‘non-destructive evaluation of munitions’ and ‘strengthening the security of maritime operations’ through to ‘smart micro- and nano-scale materials and structures’.

All details of upcoming Calls and events can be found on CDE’s website. CDE also offers further support to potential bidders by providing regular opportunities to book ‘one-to-one surgery’ appointments with CDE experts. These 30-minute slots provide general advice on a potential research proposal.

Since launching in May 2008, CDE has received more than 4000 proposals for funding, resulting in around 600 contracts valued at over £35 million.

Find out more at