The Defence Nuclear Enterprise spent £12 billion in the 2025-26 financial year and works with more than 6,000 UK-based businesses. The figures were disclosed in the government’s Defence Nuclear Enterprise 2026 Annual Update to Parliament.
Investment between 2026-27 and 2029-30 will be more than £20 billion higher than spending during the preceding four years. The enterprise has a ring-fenced budget and greater delegated spending authority, giving programme leaders more scope to accelerate decisions.
Britain is recapitalising several parts of its nuclear capability at the same time. The portfolio includes two submarine construction programmes, the design of SSN-AUKUS, two warhead programmes, work on a domestic reactor-fuel cycle and the infrastructure required to support them.
The government has committed £15 billion to the warhead programme between 2025-26 and 2029-30. It is also investing about £6 billion to expand submarine production at Barrow-in-Furness, Rolls-Royce Submarines’ Raynesway facility and across the wider supply chain.
Project Royal Oak will direct a further £26 billion into Britain’s naval bases over the next decade. The programme will prepare Faslane and Devonport to maintain current submarines and support the future Dreadnought and SSN-AUKUS fleets.
The scale of the investment is expected to increase demand for engineers, technicians and manufacturing specialists. The defence nuclear workforce is projected to rise from more than 47,000 people to about 65,000 by 2030.
Government investment in Sheffield Forgemasters has reached £1.3 billion, funding a new machine hall and forge equipped for advanced heavy manufacturing. The programme is expected to secure 700 skilled jobs and expand apprenticeship opportunities.
Britain is also investing in suppliers specialising in propulsion systems, electrical switchgear and precision engineering. A supplier-development programme is intended to improve output, reduce costs and strengthen companies facing higher demand from submarine construction.
Reforms to defence contracting will allow incentive payments of up to 10% of supplier costs, compared with a previous maximum of 2%. The higher payments will depend on companies accepting greater delivery responsibility and meeting agreed performance targets.
