THE Ministry of Defence is investing less than half in North East businesses as it was in 2013, new figures show.

Investment by the MoD fluctuates from year to year and was 147million in the North East in 2020/21, with £40m spent with small and medium size businesses.

That was down from £308m in 2013/14, though was higher last year than the previous four years.

Investment was at a low in 2018/19, when just £105m was spent in the North East.

The figures, which were released at the end of last week, have been adjusted for inflation.

Labour has accused the Government of failing to invest in home-grown businesses.

Former shadow defence minister Kevan Jones, the MP for North Durham, said: “The North East manufactures many of the UK’s world-leading capabilities for our armed forces, from armoured vehicle tracks from Cooks in Stanhope, to cables for the Royal Navy from AEI in Chester-le-Street.

"However, all defence and engineering firms in the region, big and small, rely on the UK Government to support that domestic base.

"The decline in spending in the North East is a direct result of the Government’s decision cut its future resource budget and to buy more and more equipment from the United States unnecessarily. The percentage of the UK’s defence equipment plan bought in dollars has tripled since 2016 – from 10 per cent to 31 per cent.

"The Government must accept that its choice to offshore contracts costs jobs in the North East, weakens our skills base, loosens our grip on homegrown intellectual property, and limits our exports.”

Across all regions, the total invested in UK industry was £1,663m less than in 2013/14, though it had risen in some regions, including the South West, North West and Scotland.

Spending per person in the North East is the lowest in Great Britain – at £50 – higher only than Northern Ireland.

The MoD's highest level of spending is in the South West, where it invested £6,029m last year, and South East, where it invested £4,921m.

An MoD spokesperson said: “As well as keeping our country safe, we drive prosperity, provide jobs and build skills in every part of the United Kingdom.

“Total defence expenditure with UK industry in 2020/21 was £20.5 billion – an increase of £240 million on the previous year. We have also seen the highest spend in the North East for five years.

“We expect total expenditure to fluctuate year-on-year due to large value contracts starting and ending across different financial years or large one-off payments occurring.”

The Government said the overall total appeared lower when adjusted by inflation levels of six per cent.

Chris Evans, Labour's shadow defence procurement minister, said: “The Ministry of Defence is failing to invest in British business, especially in the North East, and ministers have overseen a decade of decline in the defence and aerospace industry with 30,000 highly skilled jobs lost since 2010.

“Labour sees our defence and aerospace industries as national assets. We are committed to a 'Built-British by Default' approach to defence procurement to support British business and will work to build more resilience and security in the supply chain.”

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