The chief executive of BAE Systems has called on Prime Minister Andy Burnham to set out a "clear pathway" toward meeting NATO defence spending targets, as the new government faces scrutiny over its rearmament commitments.
Charles Woodburn welcomed Burnham's pledge to meet a NATO goal of spending 3.5 percent of national income on defence by 2035, but said the industry needed more detail. "What we're all looking for is a clear pathway towards that," Woodburn told the Mail.
Burnham has refused to commit to hitting a 3 percent spending level by 2030, even as concerns grow over a potential attack by Vladimir Putin's Russia on Europe. Defence Secretary Wes Streeting has also declined to commit to the 3 percent target, though he pledged he would not try to do defence "on the cheap."
New Chancellor John Healey previously resigned from government when he served as Defence Secretary, citing his desire for Britain to achieve the 3 percent target by 2030. His appointment to Number 11 by Burnham has reassured industry chiefs, according to the report.
Record backlog and upgraded outlook
The remarks came as BAE, which manufactures fighter jets, submarines, warships and armoured vehicles, reported an 11 percent rise in underlying profits to £1.7 billion for the first half of the year. Sales rose 9 percent to £15.8 billion.
A surge in demand pushed the company's order backlog to a record £84 billion. BAE raised its full-year profit outlook, now predicting an increase of 10 to 12 percent, up from a prior forecast of 9 to 11 percent. Shares, already up by a fifth for the year to date, rose a further 1.5 percent, or 30 pence, to 2050 pence.
BAE has benefited from increased demand since Russia's full-scale invasion of Ukraine in 2022.
Barrow visit and submarine funding
Woodburn was joined by Burnham and Streeting at BAE's shipyard in Barrow to announce a £5.9 billion investment in new nuclear-armed submarines, known as the Dreadnought class.
Woodburn said he was pleased that the government's defence investment plan, which had faced repeated delays, was finally published last month, particularly regarding the commitment to the Global Combat Air Programme, a multinational fighter jet project involving the UK, Italy and Japan.
Woodburn said that while it had sometimes been "easy to drift into a degree of complacency" about threats facing Britain, public awareness of the risks posed by Russia had grown significantly.
