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Defence spending

Defence Growth Deals Launched to Boost Local Economies and Job Creation

Strategic Insights

— 1 min read

The UK Government has announced the launch of five Defence Growth Deals worth £250 million to support local economies and create jobs in areas with high growth potential. The deals will improve collaboration, foster innovation, and drive job creation through the Defence Industrial Strategy (DIS), which aims to make the UK the best place in the world to start and grow a defence firm. The DIS will also support the UK Armed Forces and deliver benefits for working people through the government's Plan for Change.

Key Takeaways:

  • The Defence Industrial Strategy (DIS) aims to make the UK the best place in the world to start and grow a defence firm, with a focus on local economies and job creation.
  • Five Defence Growth Deals will be created, with an initial investment of £250 million over five years, to support local economies and drive innovation.
  • The deals will focus on areas with high growth potential, such as marine autonomy, UAV development, and cyber security.
  • The DIS will support the creation of up to 50,000 defence jobs by 2034/35, with an estimated demand of £4 billion in investment.
  • The Defence Growth Deals will be supported by the government's historic increase in defence spending to 2.6% of GDP by 2027 and the ambition to hit 3% in the next Parliament.
  • The deals will forge long-term partnerships between national, devolved, and local government, businesses, and research institutions to harness local expertise and resources.
  • The Defence Growth Deals will support the development of specialist steel for gun barrels and nuclear submarines, as well as the growth of the maritime autonomous systems sector.

Statistics:

  • £250 million: The initial investment in the five Defence Growth Deals.
  • 5: The number of Defence Growth Deals to be created across England, Scotland, Wales, and Northern Ireland.
  • 20,000 square feet: The engineering and production footprint of Rowden, a veteran-founded firm in Bristol.
  • 50,000: The estimated number of defence jobs to be created by 2034/35.
  • 2.6%: The historic increase in defence spending as a percentage of GDP by 2027.
  • 3%: The ambition to hit defence spending as a percentage of GDP in the next Parliament.
  • £4 billion: The estimated investment in Plymouth over a 10-year period.
  • £1 billion: The estimated investment in each Defence Growth Deal.

Sources:

  • Defence Secretary John Healey MP (M2 Communications)
  • Chancellor Rachel Reeves (M2 Communications)
  • M2 Communications (September 8, 2025)

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