Key industry players told DSEI they welcome the agreement, which puts the UK a step closer to accessing EUR150bn in funding.  

The UK has signed a wide-ranging defence agreement with the EU in the pair’s first major political tie-up since Brexit. 

The ‘Security and Defence Partnership’ creates a framework for “dialogue and cooperation” on defence and security, the UK government announced on 19 May, particularly in areas involving the defence industry, space security, and Ukraine. 

As part of the agreement, the UK will attend dialogues on foreign and security policy with the EU’s foreign affairs department every six months as well as an annual dialogue on defence. 

Both parties will also look to collaborate on training, marked by closer cooperation between the European Security and Defence College and equivalent training and education authorities in the UK.

Announcing the wider EU deal under which the defence partnership has been agreed, UK Prime Minister Sir Keir Starmer called the agreement “vital in this dangerous new era”. 

However, while many anticipated the defence agreement would grant the UK access to the EU’s Security Action for Europe (SAFE) fund, this latest agreement instead only paves the way for that access. 

Speaking about the agreement and SAFE, Starmer said, “It will open the door to working with the EU’s new defence fund – providing new opportunities for our defence industry, supporting British jobs and livelihoods”. 

SAFE is an EU financial investment vehicle intended to help member states boost their defence capabilities through common procurement.

In another reference to SAFE, President of the European Commission Ursula von der Leyen called the partnership a “first step” towards UK participation in the defence programme, during a press conference announcing the deal.

The commissioner continued by saying that joint procurement through SAFE has the potential to increase readiness, close military gaps, and improve interoperability, though she noted a further step would be needed before the UK gains access to SAFE. 

Currently, procurement processes under SAFE require the involvement of at least two EU member states, with the exception of European Free Trade Association (EFTA) states and Ukraine. This means the UK is not currently eligible. 

For access to SAFE, the UK is expected to have to pay a financial contribution, according to Secretary of State for Defence John Healy, who told BBC reporters that the UK is willing to contribute its fair share to join. A spokesperson for the prime minister said details of such a financial contribution would be a matter for the next stage of talks according to Politico.

Collaboration on maritime security is also a key part of the deal, particularly regarding maritime cybersecurity, ship and port facility security, and International Maritime Organisation initiatives. 

Can SAFE benefit Britain?
The EU’s SAFE initiative was first established as part its ReArm Europe plan announced in March, a roadmap laying out the EU’s vision for building up member states military capabilities. 

SAFE is designed to support joint procurement projects using funding from the EU’s budget and, according to an EU statement on the programme, will allow member states to “immediately and massively” scale up defence investment. 

This makes it a potential win for UK defence companies like BAE Systems or Rolls Royce if the UK was to join, as it allows UK industry to access more funding, and provides more opportunities to sell their products.

While the UK’s access to SAFE is not yet confirmed, defence companies in the UK have already expressed their enthusiasm to DSEI for the new partnership. 

“The EU is an important trading partner for us, playing host to some of our most significant partners and customers alongside our own operations, and we welcome the UK government’s commitment to closer co-operation,” a Rolls-Royce spokesperson told DSEI when asked for a response to the agreement.

Another UK-based defence company, Babcock International, also welcomed the agreement in a statement to DSEI. 

“We look forward to growing our role through this enhanced defence cooperation, working with key partners to ensure our customers are ready and able to respond to the challenges they face”, Babcock International said. 
 
“The ability for UK industry to access the EU’s SAFE defence fund is an important signal that we are committed to working together to tackle the challenges we share to keep us all safe,” David Lockwood, CEO of Babcock International Group and President of the ADS Group, added to DSEI. 
 

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