The boss of Babcock has raised fears that the long-delayed Defence Investment Plan (DIP) could be pushed back even further amid upheaval in Downing Street.

David Lockwood said Keir Starmer would have to decide whether he should sign off the military spending increase ‘or whether that should be a task for his successor’. 

Defence Secretary John Healey recently resigned over the DIP, which is expected to see defence spending increase by just £13.5billion – far less than military chiefs say is necessary to combat rising threats.

Lockwood said it would be understandable if a new team in Downing Street wanted ‘to review all line items in the Budget’. 

Asked if that might mean more delays, he said: ‘It wouldn’t surprise me.’

Babcock reported a 7 per cent rise in annual revenues to £5.2billion for the year to the end of March, but saw operating profits fall 16 per cent to £305million after a £140million charge relating to its deal to build ‘Type 31’ frigates for the Royal Navy.
Business groups have been calling on the government to make their plans clear as soon as possible.

And Lockwood noted that while higher defence spending was boosting demand, some governments were ‘balancing these priorities against fiscal constraints, as reflected in the delayed publication of the UK’s defence investment plan’.