Everything you need to know about the new UK Government

With a majority Conservative Government now in place following the surprise Election result on 7 May, changes to business practices, defence policy and the economic landscape which will impact your business will be likely.

This blog from Defence Contracts International examines what was promised by the Conservatives in the lead up to 7 May and what the future might bring for the UK defence industry.

Manifesto pledges

The Conservative manifesto put the issues of rebalancing the economy, cutting the deficit to zero as quickly as possible through departmental and welfare spending reductions and paying the UK’s debt at the forefront of their plans for economic recovery. They also pledged to have the country running a financial surplus by 2019 and to transform the UK into the most prosperous major economy in the world by the 2030s.

The Conservatives have long presented themselves as the ‘party of business’, with the previous Coalition Government making strides towards reforming Business Rates, proving new finance to business and lowering Corporation Tax.

Crucially, the Conservative Manifesto made the link between economic stability and the UK defence industry, stating: “Economic security and national security are two sides of the same coin. Without one, you cannot have the other.”

Their Manifesto pledged to maintain the size of the regular armed services and not reduce the army to below 82,000; retain Trident nuclear weapons and build a new fleet of four Successor Ballistic Missile Submarines; and continue to invest in UK defence equipment through the Defence Equipment Plan, worth £160bn.

The Conservatives have also announced a National Security Strategy and Strategic Defence and Security Review later this year in order to continue to plan for the future of defence.

Cabinet reshuffle

One of David Cameron’s first tasks following the Election result was to undertake a Cabinet Reshuffle, primarily to replace the Liberal Democrat MPs in the previous Coalition cabinet after their Election losses.

For businesses, several of these appointments will have a lasting impact on the pledges made prior to the Election and the future policies implemented by the new Government.

Sajid Javid has now moved to the position of Business Secretary after previously holding the post of Culture Secretary, replacing the former Lib Dem MP Vince Cable. In addition, Anna Soubry moves to the position of Small Business Minister.

Michael Fallon, the existing Defence Secretary, will remain in his post. In a speech before the Election, Mr Fallon warned of the dangers of scrapping Trident, highlighting his own personal commitment to extending the programme.


One of the key campaign battlegrounds in the lead up to the General Election was the issue of Europe, with both UKIP and the Conservatives leading the charge for an EU referendum.

The Conservative Manifesto pledged an in/out referendum on UK membership of the EU by 2017, and this is now all but assured following their Election victory.

In addition to the referendum, the Conservatives have pledged to renegotiate the terms of the UK’s membership of the EU, seeking to reduce red tape for businesses, gain the power to block unwanted EU legislation, keep the pound and scrap the Human Right Act.

While David Cameron himself remains committed to the UK being a partner of Europe, his Cabinet Reshuffle and additional MPs following the Election result are more Eurosceptic than their Prime Minister, leading many to believe that a UK exit from the EU within a few years could be a distinct possibility.

What’s next?

The coming months are likely to be politically and economically interesting, particularly for businesses. With reforms of the banking sector, defence investment, new business rates and tax legislation and much more already on the way, the bottom line is more opportunities for businesses like yours.

With new opportunities around the corner, you should make sure you’re in the best possible position to make the most of them.

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