Following on from the Government’s Strategic Defence Review, two prominent Labour MPs have called for a complete overhaul of outdated rules holding back defence sector financing, to accelerate economic benefits to the UK and enhance the nation’s security.

The landmark report titled ‘Rewiring British Defence Financing’, co-authored by Luke Charters MP (York Outer) and Alex Baker MP (Aldershot) outlines that the rapid pace of technological development, and changing need of the UK’s defence forces means a radical overhaul of defence financing is urgently required.

The report comes after months of meetings that both MPs have held with senior leaders across both the defence and financial services sectors – culminating in twelve concrete recommendations for the Government to consider. Both MPs praise the Government for their work in tackling defence financing gaps so far – and stress this report can help unblock further issues.

The recommendations made in the report range from mechanisms to boost and de-risk private sector investment, through to measures to protect bank staff from politically motivated violence.

Alex Baker, MP for Aldershot and Farnborough, said: “Without doubt the Government’s commitment to rapidly increased defence spending is necessary if we are to protect the UK.

“But, from working with local defence SMEs, it’s clear to me that better collaboration and a rethink of the relationship between government and private finance is needed to support the companies that will drive technological innovation most quickly and generate economic prosperity in the process.

“This is vitally important if the defence personnel that I represent are to be armed with the up-to-date technologies that modern warfare demands, just as it is for the jobs and skills of my constituents working in the defence industries”.

Luke Charters, MP for York Outer, said: “A fundamental rewiring of the financing system could prove critical to harnessing the defence dividend and maintaining the UK’s strategic edge at a time when war rages on our continent.

“We are home to a world-leading financial services sector, and first-class defence SMEs – who are being hamstrung by red-tape and outdated rules. Currently, many defence companies struggle to get the basics, such as banks accounts or insurance, let alone the financial muscle they need to scale up and deliver for our soldiers, sailors and aircrews.

“Fixing defence sector financing is not just good for our national security, but it is vital for our economic security.”

The report will be launched on Monday 9 June in the Houses of Parliament to an audience of parliamentarians, finance and defence industry experts.