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By Adam Treger
The United Kingdom’s Royal Navy, once the world’s pre-eminent seafaring force and largely responsible for the country’s historic prosperity, today boasts more admirals than warships ready for deployment. While this is symbolic of the country’s wider decline in hard power, the UK can take solace in the knowledge that its soft power continues to endure and even flourish thanks to Shakespeare, Harry Potter, the Beatles, and the Royal Family. British football and the Premier League, perhaps the country’s biggest export, have attracted billions in foreign direct investment.
Another key tenet of the UK’s soft power is its educational institutions. Universities such as Oxford, Cambridge, the London School of Economics, and Imperial College London are consistently ranked among the best in the world. Not only are they intellectually prestigious, but they also attract top students, researchers, and academics from around the globe, creating an evergreen network of affinity for British culture, ideas, and values.
Leveraging the innovation potential of these universities will be key to bolstering the UK’s sluggish defence industrial base and strengthening the country’s hard power at a time when it is most urgently required. This is exactly what the government has attempted to do through a series of policies under the new Defence Industrial Strategy. While some measures are welcome, such as increased funding for defence skills training, others, in typical British fashion, are not ambitious or far-reaching enough.
Firstly, the government will form a “defence alliance” of universities, funding them to create new and innovative defence technologies. Concrete details are yet to be released, but The Times, in its coverage, highlights several institutions likely to be favoured by the Ministry of Defence. While many of the suggested universities hold strategic significance, Oxford, Cambridge, and Imperial are conspicuously absent. It seems an oversight to overlook the UK’s top institutions, particularly given their leadership in artificial intelligence (AI). Developing globally leading sovereign UK AI must be a national security priority, as it will form the backbone of other defence technologies, including intelligence, surveillance and reconnaissance (ISR), cyber defence, and unmanned aerial, land, and sea systems.
Secondly, while a £400m UK Defence Innovation fund was announced, only 10% of this is committed to “novel technologies” such as AI-enabled drone swarms. £40m for this crucial endeavour is a pitiful sum which is unlikely to deliver meaningful results. Compare this to the £35bn we are paying to surrender the Chagos Islands or the $4bn annual budget of DARPA in the USA. The government should deploy more capital to initiatives like the UK Innovation & Science Seed Fund’s Defence & Security Seed portfolio, which should in turn invest in the best startups emerging from our universities. Or better yet, the Ministry of Defence should develop mechanisms to encourage private capital, of which there is an increasingly greater quantity focused on defence in Europe, to invest into startups in areas of strategic priority for the government. This would be a significant tailwind to our defence industrial base.
Thirdly, the government should establish clear pathways for the most promising technologies and startups emerging from universities to transition into fully fledged companies. This requires rapid procurement lanes, enabling startups to move swiftly from the lab to prototypes and, ultimately, field trials. The UK currently lacks flexible funding outside the traditional procurement process and should emulate the scale and agility of the US Small Business Innovation Research (SBIR) and Other Transaction Authority (OTA) programs to accelerate its best prospects. Alongside this, the government should introduce standardised, pre-negotiated intellectual property and contract templates for defence-related university spin-outs, streamlining potentially arduous negotiations over ownership, licensing, and security provisions.
Finally, the government should establish a full suite of metrics to track universities’ contributions to the defence industrial base. Annual reporting of KPIs such as the number of prototypes transitioned to MoD trials within 24 months, the volume and value of contracts awarded to university startups, and the number of graduates entering defence careers—would provide clear evidence of impact. This would enable the government to identify where public funding yields the most significant capability gains, allowing ministers to double down on the areas proving most effective.
Britain’s universities possess untapped potential to strengthen the defence industrial base. The government must act decisively to ensure that the new universities “defence alliance” includes the top institutions, that strategic funding is available for the best university startups, and that rapid procurement pathways and robust accountability mechanisms are in place. Accomplishing these goals would revitalise innovation in UK universities and safeguard their global standing. Britain cannot afford to let its brightest ideas die in the lab while adversaries weaponise theirs: failure to act risks undermining both our technological edge and our national security.
