Minister for Defence Readiness and Industry Luke Pollard MP's speech at Mansion House Defence and Security event

Minister Pollard highlighting the importance of collaboration between government, industry and private finance, to strengthen UK deterrence and drive economic growth.

"Lady Mayor, thank you very much for hosting this event today and good afternoon, everyone. It's a real pleasure to be with you today.  

Under this one roof we have many leaders and decision makers needed to spark that next generation of defence innovation that we need to keep our country safe and support our allies. So, thank you for giving up your valuable time to be here.  

I'm honoured that I get to speak as warm up act to my friend, the Ukrainian Ambassador. I've spent a lot of time in Kyiv over the past two years in particular, and the courage of the Ukrainian people is something that we must honour not just in words but in the actual support that we provide for their frontline, for their nation, for the innovators and we do that by not just sending equipment to Ukraine but by partnering, innovating and developing new technologies together.  

I know that there are people in this room whose work is not theoretical in that regard and you are making a big difference to our friends in Ukraine so thank you for what you do.  

Now, we meet at a point where global geopolitics is more fragile, more disruptive and more changeable. And that means we need an entirely new system of warfighting and deterrence, which means more innovation and new approaches with new weapon systems that revolutionised the battlefield.  

Certainly, the way that the United Kingdom would now fight is fundamentally different today than it was at the point when Putin launched his full-scale invasion of Ukraine only those four and a half years ago. We're learning the lessons from Ukraine by supporting them, but that means changing the way that the United Kingdom operates.  

Now, our most urgent mission right now is to transform Britain's defence posture and turbocharge innovation. Many of the most critical advances in defence right now are coming from tech startups and tech scale-ups. Agile businesses which are seizing the opportunities on offer and driving change at speed. And so today our challenge is this: how can we get better at finding, funding and firing up the most creative minds and enterprise to get the best technology into the hands of our armed forces and those of our allies as fast as possible.  

Now it was just over two years ago that this government took office and we inherited a defence programme which to be honest and to be frank was unfit to counter the dangers that we now face. We are moving towards warfighting readiness and in doing so we must discard the warm comfort blanket that we are used to in Britain, of polishing old things and pretending that that will protect us. If our technology and kit will not work in Ukraine, I do not want it in our armed forces. That is an opportunity for new technology, new thinking, new weapons to be brought to the fore. And in designing new technology, we need to design for the conflicts of today and the battles of tomorrow.  

Now, our supply chains are critical to that. An industry that works in our supply chains know how painfully slow, wasteful and costly the procurement the MOD previously undertook was. We are changing that. I think it was especially true for those small businesses and scale-ups with amazing products who struggled sometimes to find the right buyer within the MOD.  

Now since that time, we've produced a new blueprint for a completely different type of military and a different type of procurement. We published our Strategic Defence Review, Defence Industrial Strategy and Defence Investment Plan to build a more resilient and warfighting-ready military, backed by a world-class supply chain and we're bringing industry into the heart of defence the fundamental enabler of everything that we are trying to achieve. To not only make our country more secure, but also more successful and prosperous, by creating high-quality defence jobs, skills and opportunities in every postcode.  

I used to be incentivised by the MOD press office to say defence is an engine for growth in all my interviews, they used to be encouraging me to do it. With Andy Burnham in Downing Street I now say re-industrialisation, but the fundamental truth is there. Investment in defence creates good jobs. It provides opportunities in particular for our young people and we should be unafraid and unapologetic of saying that truth loudly. Defence spending is an engine for growth. It is a way of re-industrialising. It is a way of creating opportunity. It also keeps us safe.  

Now to make our country more secure and more successful we need to create more high quality defence jobs, skills and opportunities. Now if we are to do that SMEs in particular, scale-ups, are really important. Within the MOD, we've reformed our system with a new National Armaments Director, Rupert Pearce, coming from a FTSE 100 company, bringing a new corporate approach and energy to the way that we procure.  

We've established the Defence Office of Small Business growth to help remove those obstacles to entry, cut red tape, and roll out a 50% increase in spend from the MOD with medium and small-sized firms by Summer 2028. That's moving an extra two and a half billion pounds into the pockets of SMEs by changing the way we procure, making it easier for small businesses to enter our supply chain.  

We've published our SME Action Plan to set out what we will do so we can be held accountable for that change, and that supports start-ups, scale-ups, and other companies to be able to grow. And helping small firms navigate the routes to funding is something crucial if you want to get the best out of them. At a national level our Defence Office for Small Business Growth provides the guidance for those routes, removes duplication when we find it and clarifies the entry points where necessary.  

At local levels I'm really pleased that the rollout of regional defence and security clusters have been so successful with more regions developing them, creating new regional routes to tailor support for businesses and bring together localised networks of major suppliers, devolved and local governments and importantly provide a forum for investors to meet them and support them as well.  

Now, Ukraine has shown us the way to innovate at lightning speed because of the necessity of the war that they are fighting. And as we learn from Ukraine's lead, defence must harness the resources that Britain possesses not just across tech and engineering sectors, but across finance, consulting and academia as well - to help create, inspire and deliver the change that we need. And finance is obviously key to our topic today.  

Now, the government is already increasing defence spending. As a defence minister, of course, I would like more defence spending. But it's not just from the taxpayer that there's opportunities for investing in defence. It's how you crowd in private capital, how you use the institutions, the networks, the structures of the City of London and the UK's place at the heart of global financial trade, to bring more private capital into defence, creating more good jobs and more deterrence. Now, public investment will remain central to that mission as we increase our defence capabilities. But in a more dangerous world, we need to build more capacity now, rather than just wait for the increase in defence money that we know is coming over the next 10 years.  

So that's why the Defence Investment Plan sets out the priority areas that we will invest in both now, and later to provide the certainty for investors to understand what type of technologies, what areas of defence will the government invest in, where we also seek investment from the private sector.  

And we need to work hard to make sure that Defence and our colleagues in the investment community speak the same language. Because I think, at the moment, there's a risk that we sometimes speak past each other. And speaking the same language with the same necessary data will increase our ability to deliver. 

Now, Britain has long prospered when government, industry and finance have worked together and our task today is not to reinvent the finance sectors, but a way of bringing us together to create that new partnership for today's era.  

Now, the prize is significant, not just stronger national defence and security, but a more innovative defence sector and a growing market that helps re-industrialise, but also an opportunity to export to our friends as well. Because it's not just the United Kingdom that's investing in defence. Our allies in NATO and further afield are doing the same.  

Now, in the Defence Investment Plan, we announced a Defence Investment Unit because investors need a clearer interface with defence and defence needs financial expertise to turn priorities into market-facing propositions, speaking the same language.  

Following the autumn budget this year, we will publish the Defence Finance Investment Strategy to set a clear framework for how government and responsible private capital can work together in support of security, resilience and growth. And in December, we will also hold a defence investment summit to turn strategy into delivery and bring together government, industry and investors to accelerate the flow of capital into priority defence capabilities.  

Now, before I finish, I want to set out that this is not a theoretical game. This is happening right now and we need to make it easier for it to happen more frequently. In May, 13 British startups were awarded contracts of up to £4 million as part of the Defence Unicorn Fund programme. Kraken Technologies, as one of them, which manufactures maritime uncrewed surface vehicles, has since gone on to raise $175 million in a Series B funding round off the back of a $1 billion valuation. Green Jets is another British firm which has secured significant funding from capital. It was just one of three firms selected by the Ministry of Defence to develop a low-cost drone interceptor. Both Kraken and Green Jets received funding from the National Security Strategic Investment Fund and NATO Innovation Fund, while the British Business Bank also financed Kraken. And JET Connectivity, a small business which builds novel 5G and 6G communications tools was the only British firm to be admitted to the procedures NATO Diana mission track programme earlier this year from over three and a half thousand participants. 

That was fantastic recognition of British innovation at its best, but I know it's just the tip of the iceberg. There are so many other British, brilliant British companies that we need to be able to support as well.  

Now, it is in these uncertain times that not only do friends stand together, which is why the support that we offer in Ukraine is long lasting, is serious and will not change no matter what threats Putin throws at us. It is also in these uncertain times that we need to make it easier to bring private capital and public investment together to create the new defence technologies that we need to keep our nation safe.  

But let me finish with a final thought. Today we will not only get a clearer view of the potential on offer in the growing defence industry in the UK, and advice on how you can access more of that market. We also get a chance to keep Britain secure in a more dangerous world. Defence needs to be a national endeavour. A whole of society endeavour, a whole of government endeavour. It is the responsibility of the Ministry of Defence to lead that, but it is not the responsibility of the Ministry of Defence alone. To keep our nation safe, we need every part of society, every part of government and industry to step up to support that resilience, that innovation, and that drive to keep us all safe. Because as we can see from our friends in Ukraine, where deterrence fails, not only is it more and more expensive in treasure and lives and lost opportunity. It's something that, as everyone here, we must take steps to avoid. That is why deterrence matters. That's why increasing our deterrence matters with new technologies. But if deterrence fails, we must be ready to fight, and we must be ready to win. And all of you in this group can play a part in doing so.  

Thank you for what you're doing here today, and thank you Lady Mayor for bringing us all together."