UK shipbuilding prioritised under reforms to boost domestic industry and security

Shipbuilding has been elevated to priority status under reforms to the Procurement Act 2023, in a move the Ministry of Defence says should channel more work towards British yards and their suppliers.

Defence Minister Luke Pollard set out the government’s position in a written answer to Luke Akehurst, the Labour MP for North Durham, who asked what the department expected the Act to do for the UK shipbuilding sector. Pollard said the government recognises the importance of a so...

vereign shipbuilding industry for national and economic security, and argued that the latest policy changes would help push more contracts towards British shipyards, boatyards and small and medium-sized firms.

The Cabinet Office has added shipbuilding to the list of sectors subject to priority procurement reform on the basis that it is critical to national security. According to Pollard, that should translate into a greater share of contract awards being placed in the UK.

The National Shipbuilding Office is leading the work alongside the Cabinet Office, with the aim of building a new framework intended to increase domestic shipbuilding activity. Pollard said the office’s forthcoming Shipbuilding and Maritime Technology Action Plan would go further than previous strategies and set out how the government intends to support the sector.

The National Shipbuilding Office, which is hosted by the Ministry of Defence, already has responsibility for coordinating shipbuilding policy across government. Its remit includes working with industry, wider supply-chain firms and devolved administrations to improve productivity and competitiveness across the sector.

The Procurement Act 2023 came into force for UK public bodies in February 2025, replacing the previous regime with rules designed to give buyers more flexibility and to take account of factors beyond simple lowest-cost bids, including social value and national security. By identifying sectors for priority reform, ministers are seeking to direct procurement in areas they regard as strategically important.

For shipbuilding, that matters because the industry is concentrated in a relatively small number of major yards, including BAE Systems on the Clyde and Babcock at Rosyth, while many smaller firms contribute equipment, components and specialist services. The government’s emphasis on small and medium-sized enterprises reflects a broader defence procurement push, with ministers arguing that a wider spread of spending can support jobs, skills and supply-chain resilience as well as domestic capacity.

Source: Noah Wire Services