A report from consultant Gleeds says the Defence Infrastructure Organisation must shift away from one-off procurement towards alliancing and early contractor involvement to build the strong supply chain needed to deliver at pace the UK’s ambitions.
Defence infrastructure spending is expected to rise sharply as part of wider plans to increase defence budgets towards 2.5% of GDP, unlocking tens of billions of pounds of work across bases, training estates and secure facilities over the coming decade.
The Strategic Defence Review has already committed £1.5bn to deliver at least six new UK munitions and energetics factories, underlining the scale of the pipeline coming forward.
But the report warns the system is not set up to deliver at pace.
One defence construction contractor told the consultant that despite public discussion about increased defence spending, the last six to eight months have seen a hiatus in schemes reaching contractors, leaving uncertainty over timing, scope, and funding sources.
Fragmented procurement, slow approvals and inconsistent pipelines are driving inefficiency, inflating bid costs and deterring contractors from committing long-term resources.
Mark Graves, senior director of energy and defence at Gleeds, said: “The basics are missing, and this is not new. Budgets are fluid, programmes are delayed or slow to reach market, and ageing infrastructure drives a ‘make do and mend’ approach within overly complicated contractual arrangements.
“Pace in strategic infrastructure programmes is not always there and suffers from a lack of experienced resource on both the industry and client side. Key resource is far more transient today, with international opportunities in adjacent sectors on a more commercial footing coming to market quicker and attracting talent away from defence.”
The report highlights how rigid business case processes and duplicated requirements are adding years to delivery timelines.
Melanie Phillips, director at Gleeds, said: “Sequential assurance cycles from Strategic Outline Business Case (SOBC) to Outline Business Case (OBC) to Full Business Case (FBC) can add years. Business case, commercial strategy, and delivery planning can run concurrently.
“Requirements change post-contract because they were never standardised for common facility types, where many requirements for accommodation, training estates and storage are replicable.
“Delegation thresholds are often too low, escalating routine decisions to senior sign-off, which immobilises the delivery organisation.”
Gleeds argues that without a shift to long-term programme pipelines, standardised delivery models and proper risk allocation, defence will struggle to compete with sectors such as energy, transport and data centres that offer clearer pipelines and more commercially attractive terms to contractors.
