16 February - 22 February 2026
Government eyes 3% of GDP by 2029
The BBC and Reuters reported on 16 February that Downing Street is actively examining proposals to reach 3% of GDP by 2029 — four to five years earlier than planned. No decision has been taken and the Treasury is cautious, but the shift from long-term aspiration to near-term planning is significant. The OBR has costed the 3% target at an additional £17.3 billion per year by 2029-30. If confirmed in the Defence Investment Plan — due any week — it would pull forward major programme decisions currently sitting well beyond the 2027 horizon.
Source: Reuters, 16 February 2026 — https://finance.yahoo.com/news/uk-may-bring-forward-3-075156321.html
POLICY & GOVERNMENT
MOD confirms Palantir deal was a direct, non-competitive, procurement
Written parliamentary answers on 18 February confirmed the £240 million Palantir enterprise agreement was awarded without competition under the Procurement Act 2023, citing sole-source technical dependency and continuity of service. The political controversy aside, the more significant figure for BD teams: 49% of the value of new MOD contracts in the year to April 2025 were issued without competitive tender — the highest since 2016. Suppliers already embedded in programmes are benefiting; those seeking to displace incumbents need to get inside programmes before re-competitions open.
Source: UK Defence Journal, 18 February 2026 — https://ukdefencejournal.org.uk/mod-confirms-palantir-contract-was-direct-award/
DIP now overdue — PAC scrutiny inquiry opens
The Defence Investment Plan has slipped past every projected publication date and is now expected before end of March. The Public Accounts Committee has opened a formal call for evidence on DIP affordability, with submissions accepted until 9 March. The PAC inquiry follows a NAO assessment of a £42.5 billion funding gap in the previous Equipment Plan. Written answers this week confirmed the Ajax safety review is now explicitly linked to DIP decisions. Publication will likely be announced at short notice.
Source: PAC inquiry page — https://committees.parliament.uk/work/9520/affordability-of-the-defence-investment-plan/
MOD opens call for evidence on autonomous systems regulation
On 20 February the MOD launched a call for evidence on the regulatory environment governing uncrewed and autonomous systems, seeking industry views on removing barriers to faster delivery and scale-up. The review flows directly from the Defence Industrial Strategy's commitment to a regulatory framework that is "as permissive and simple as possible." For companies in the UAS, autonomy or AI space, this is a direct opportunity to shape the framework ahead of implementation — and to put your organisation's name in front of the relevant MOD policy team.
Source: GOV.UK, 20 February 2026 — https://www.gov.uk/government/calls-for-evidence/review-of-mod-legislation-governing-autonomous-systems
CONTRACTS & AWARDS
Ajax survival in doubt — FOC confirmed for 2029 if programme proceeds
A written parliamentary answer on 19 February confirmed Full Operating Capability for Ajax by end of 2029 — but only if the programme survives its ongoing ministerial review. The vehicle remains subject to three separate investigations following a November safety incident, with IOC status paused. The Defence Secretary has framed the choice as "back it or scrap it." The DIP will contain the outcome. If cancelled, a consequential armoured cavalry capability gap would represent a new competitive opportunity across the land systems supply chain.
Source: Forces News / UK Defence Journal, 19 February 2026 — https://ukdefencejournal.org.uk/ajax-to-reach-full-capability-by-2029-if-not-scrapped/
INDUSTRY MOVES
AtkinsRéalis teams with Anduril UK to certify autonomous aircraft
On 17 February, AtkinsRéalis entered an exclusive teaming agreement with Anduril UK to support the development and deployment of autonomous aircraft for UK defence programmes. AtkinsRéalis will provide safety, assurance and regulatory expertise to navigate Military Aviation Authority and Civil Aviation Authority approvals — the firm holds the CAA's first approved flightworthiness assessor status for commercial drones. The partnership also covers support for Anduril UK's plans to establish a UK manufacturing site for uncrewed platforms. For companies tracking the autonomous systems supply chain, this pairing signals that regulatory authority and assurance capability are becoming as critical as the hardware itself.
Source: ADS Advance / UK Defence Journal, 17 February 2026 — https://ukdefencejournal.org.uk/atkinsrealis-anduril-uk-partner-on-autonomous-aircraft/
Archer Aviation confirms Bristol as home for UK engineering hub, hiring begins
On 19 February, US defence-tech firm Archer Aviation confirmed Bristol as the location for its UK Engineering Hub, with hiring of engineers now under way. The hub will support Archer's work with Anduril UK and GKN Aerospace on the British Army's Project NYX and the MOD's Land Autonomous Collaborative Platform programme. For BD teams, it is a further signal of US defence-tech appetite for the UK market — and a reminder that Bristol's aerospace ecosystem is increasingly pulling in investment tied directly to MOD autonomous programmes.
Source: Business Wire / Archer Aviation, 19 February 2026 — https://www.businesswire.com/news/home/20260219569173/en/Archer-Selects-Bristol-As-Home-For-Its-UK-Engineering-Hub
PROCUREMENT PIPELINE
Watch for MOD spending signals ahead of DIP publication
Parliament votes on 4 March to approve the government's revised departmental spending plans for 2025/26, including the MOD's updated in-year budget. With the Defence Investment Plan still outstanding and pressure mounting to accelerate the 3% trajectory, any accompanying ministerial statements could indicate where additional defence funding is being directed this financial year. BD teams with active bids or programmes in flight should monitor closely.
Source: House of Commons Library — https://commonslibrary.parliament.uk/research-briefings/cbp-10500/
INTERNATIONAL
UK launches LEAP air defence initiative with four European allies
At the European Group of Five meeting in Krakow on 20 February, the UK, France, Germany, Italy and Poland formally launched LEAP — the Low-Cost Effectors and Autonomous Platforms initiative. The programme will develop affordable surface-to-air systems and autonomous drones drawing on Ukraine battlefield lessons, with a first project targeted for 2027. The MOD explicitly stated the programme will seek proposals from both prime contractors and SMEs. For UK companies in counter-drone, autonomous systems, lightweight weapons or AI-enabled targeting, this is an active and time-pressured opportunity.
Source: GOV.UK / MOD press release, 20 February 2026 — https://www.gov.uk/government/news/uk-and-european-allies-to-develop-low-cost-air-defence-weapons-to-protect-nato-skies