Budget reaction from A|D|S

Posted on 25 Mar 2010 by The Manufacturer

A|D|S, the trade organisation representing the UK’s AeroSpace, Defence and Security industries, comments on Alistair Darling’s Budget speech to the House of Commons.

Ian Godden, Chairman of A|D|S, said: “We welcome the Chancellor’s focus on recovering from recession and investing in our industrial future, especially his focus on encouraging exports, supporting trade and discouraging protectionism as well as his warm words for advanced manufacturing, especially aerospace. His recognition that economic growth is the key to our recovery and reducing borrowing is encouraging and the sectors that we represent can deliver the goods in this regard.

“The British aerospace, defence and security sectors are number one in Europe and second only to the US globally. They can deliver on the Chancellor’s aim to generate long-term prosperity for Britain. There is considerable room for growth in the export markets for these successful sectors that would contribute to the recovery from recession and deliver a sustainable industrial future with many additional jobs. For example, a recent study by Oxford Economics has shown that an additional Government investment of £100m in defence would deliver an output of £227m. That investment would also bring about an estimated additional 1,885 jobs.

“We will shortly be publishing manifestos for each of the four world-leading sectors that we represent to demonstrate to the political parties in the run-up to the General Election what we can deliver for the country in terms of jobs and added value to the economy providing current and future Governments deliver the correct climate in which they can prosper.”

On defence, Godden continued: “The defence budget is in urgent need of attention, notwithstanding the additional and separate £4bn from the Treasury reserve for operations in Afghanistan for next year. It was disappointing that nothing specific was announced to address this funding gap.

“Instead of seeking to further cut or reallocate resources from one vital project to another it is time to recognise that defence has made its contribution to Government savings over the last two decades, and that other departments must now have their budgets placed under similar pressure if future spending cuts are required to reduce the public sector deficit.

“As the Public Accounts Committee has confirmed, there is a hole in the Ministry of Defence budget. A large part of this is because defence has been consistently underfunded over a long period of time, despite our armed forces being involved in two intense conflicts. While other departmental budgets have continued to rise, defence has been under constant pressure and scrutiny despite the operational demands on the MoD’s funds.”