New figures from the Ministry of Defence show the breakdown of defence contracts awarded over the past year, but also reveal billions of pounds of spending that cannot yet be clearly attributed to UK or overseas suppliers.
The disclosure came in response to a written question from Conservative MP Paul Holmes on 1 September. He asked how many and what proportion of contracts were awarded to UK and non-UK companies in the last 12 months.
Defence Minister Maria Eagle replied that between 1 July 2024 and 30 June 2025 the MoD awarded 2,674 contracts worth a combined £23 billion. Of these, 1,244 contracts valued at £17 billion were awarded to suppliers based in the UK. A further 174 contracts worth £3 billion were awarded to suppliers outside the UK.
The remaining 1,256 contracts, representing £3 billion, are still under reconciliation. Eagle explained that the MoD records contract awards “based on the administrative address provided in the supplier’s successful tender.” She added that this does not always reflect where the services are delivered.
That accounting method creates uncertainty about the economic impact of procurement. A company registered in the UK may rely heavily on overseas supply chains, while an international parent company may deliver significant work through UK facilities. Eagle said the department compiles contractual statistics “based on the location where the services are delivered” to try to reflect actual economic value.
The figures show that most recorded spending is with UK-based firms, but the unresolved £3 billion amounts to more than one tenth of the total contract value. Until the reconciliation process is completed, it is unclear how much of this sum is supporting British jobs, skills and supply chains, or flowing abroad.
The question comes at a time when the government has placed strong emphasis on defence industrial policy. Ministers have described procurement as both a national security requirement and an industrial strategy tool. Yet the current reporting system makes it difficult to track the extent to which spending sustains the domestic base.
The MoD has not set out when the reconciliation of contracts will be completed, leaving an important gap in visibility.
Could it be that if the MoD awarded as big a proportion of its funding to British Small to Medium Sized Enterprises as it is supposed to, rather than to massive multinational offshore accounted para-statals, such a reconciliation as is, apparently, taking place might be a great deal more straightforward?