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Defence Reform

Today this Government is bringing in the deepest reforms in UK Defence for 50 years, which will fundamentally change the way defence operates.

Defence must change to make Britain secure at home and strong abroad. The Government’s recent announcement of the largest sustained increase to defence spending since the Cold War – rising to 2.5% of GDP in 2027, with an ambition to reach 3% in the next Parliament - is crucial for our national security. It is also a huge opportunity, and responsibility, for UK Defence.

Alongside this significant investment, must come serious reform: to speed up our decision making, focus on outcomes, secure faster delivery and achieve the best value for money for our troops and taxpayers.

Under the Secretary of State and Ministers, UK Defence will now be led by a strengthened Department of State, a fully-fledged Military Strategic Headquarters, a new National Armaments Director Group, and the Defence Nuclear Enterprise.

Our new leadership “Quad” - the Permanent Secretary, Chief of the Defence Staff, National Armaments Director, and Chief of Defence Nuclear - will drive a defence which is more concentrated on strengthening warfighting readiness and deterrence. They will shift an organisation which too often has been obsessed with process to one focused on outcomes - in which information flows quickly, individual accountabilities are clear, and results are demanded.

The key features of our new system will be:

1. The Permanent Secretary will lead a more agile Department of State. In line with wider Civil Service Reform, this area will be lean and highly skilled, unleashing the exceptional capabilities within Defence by making the systems and processes around us more efficient and empowering. This area will be responsible for providing policy muscle and clear strategic direction to ensure that the Defence is focused on outcomes and delivery. The Department of State will contain a streamlined set of four DG roles reporting to the Permanent Secretary, focused on strategy and transformation, people, policy and finance.
2. Our Armed Forces show great courage and collaboration in the work they do on operations to keep our country secure at home and strong abroad. The UK Armed Forces' most senior officer, the Chief of the Defence Staff (CDS), will, for the first time since this role was created, now command the Service Chiefs and head a newly-established Military Strategic Headquarters as the single point of force design and delivery of the Armed Forces. The new MSHQ will support the journey from a ‘joint’ to an ‘integrated’ force that better harnesses all five domains of maritime, air, land, cyber and space. They will be supported by a small central team integrating across activity and force design, prioritising investment to improve warfighting readiness and lethality.
3. The National Armaments Director Group will fix the broken procurement system and make defence an engine for economic growth in every corner of the UK. It will bring together teams delivering the national ‘arsenal’, the Government's Defence Industrial Strategy and end to end acquisition under one leader, the National Armaments Director. This new structure will enable collaboration by bringing together Defence Equipment & Support, Defence Infrastructure Organisation, Defence Science and Technology Laboratory, Defence Digital and parts of Defence Support. The Group will also include roles focused on International Collaboration and Exports, Commercial and Industry, Options and Commissioning, and Corporate, with the Enterprise CIO moving to the Group by 1 July 2025. These roles will work together, and with industry, academia, international partners and allies to develop and deliver innovative solutions to departmental problems.
4. The Chief of Defence Nuclear is responsible for cohering across the Defence Nuclear Enterprise (DNE), in addition to leading the Defence Nuclear Organisation (DNO) and its Arms-Length Bodies. The DNE unites the Royal Navy, Strategic Command and DNO, with its ALBs including the Submarine Delivery Agency and AWE - the partnership of organisations that maintain, renew, and sustain the UK’s nuclear deterrent which keeps us and our NATO allies safe 24/7. The financial nuclear ringfence ensures nuclear spending is prioritised and allows a focus on delivery and outcomes. Under Defence Reform, CDN will act as the clear point of accountability for the ringfence, working closely with industry and the MSHQ finance teams to ensure effective management.

We will have four new budget holders, one for each of the Quad. Funding and spend will be categorised into Invest, Readiness and Operate – with the NAD holding the Invest budget and MSHQ responsible for the Operate budget and the Readiness budget of the frontline commands. Balance of investment decisions will be made across the whole department, set against Ministers’ strategic priorities to ensure resources match ambitions. The Principal Accounting Officer will delegate multi-year budgets, in line with HMT’s Departmental spending settlement, to each area. Financial Year 2025-26 will be a transitional year, with quarterly reform programme milestones through the year and the bulk of the transformation complete by Financial Year 2026-27. The drive to reform Defence will continue throughout this parliament.

The far-reaching changes in this Defence reform programme will help cut waste, boost British growth and jobs, and fast-track the technologies of the future into the hands of our frontline forces.

This is the start of a new era of UK Defence.