As war rages on our continent, we must be clear about the necessity of investing in defence.
That was our message to UK banks and fund managers, in a letter co-signed by 100 Labour parliamentarians, requesting that ESG mechanisms are changed to better support investment in British defence.
Boosting our innovative defence sector is vital to the UK growth agenda, while our support for Ukraine is unwavering. Both of these are clear priorities for this government and demonstrates the profound transformation within the Labour Party under Keir Starmer’s leadership.
Our campaign has been met with a positive response. We have been inundated with messages from firms recalibrating their approach – investment companies revising their policies to better accommodate defence, banks affirming their willingness to onboard defence companies, and even the regulator, the Financial Conduct Authority, has explicitly stated that its rules should not obstruct defence investment.
Further still, we’ve seen sustainable funds widen their scope, institutional clients clarifying their stance towards defence investment, and banking trade bodies formally committing to support the sector.
This marks the start of a fundamental shift in how defence is perceived within financial services. To defend Britain and support Ukraine, we must harness our financial sector to back the best of British innovation and skills, as part of a truly national endeavour.
None of this campaign would have been possible without the fundamental changes within our party led by the prime minister – not just in the number of MPs on the backbenches, but in our ways of working and our stance on key national and global issues.
In recent weeks, we’ve adopted a pragmatic approach. Labour has taken bold steps, like reshaping NHS England and modernising the civil service with new technology and AI. These decisions are right decisions: difficult, but necessary.
This transformation did not happen overnight, and it is far from over. The journey is still unfolding; under Starmer in Downing Street, it is now moving at pace.
The failure of the previous government speaks for itself. The Conservatives spent the last five years clinging to their dreadful legacy, suffering a historic defeat because they lost the trust of the British people.
But not long ago, our own party had to confront hard truths. After the 2019 election, it was almost unimaginable how quickly this transformation would take hold. Back then, we were at our lowest ebb electorally and lacked credible policies on key areas such as UK defence and how to unleash our financial services system. Not any more.
It is to Starmer’s immense credit – through his “country first, party second” leadership, tenacity, and determination to improve our country – that we are here today. He does not shy away from hard choices.
The post-WWII Attlee government not only transformed Britain into a nuclear power, but a founding NATO nation.
Today, Labour has reclaimed its historic commitment to defence, to rearmament in times of peril, and to the steadfast belief in peace through strength. The investment to make it happen will be led by the public sector and bolstered by the private sector.
Together, we can reinforce the NATO alliance, protect a vital ally, and position Britain at the helm.
Alex Baker and Luke Charters are Labour MPs leading a campaign to remove barriers to defence investment.
