BAE Systems chief executive Charles Woodburn has warned that UK defence spending remains insufficient to protect the country, despite the Government announcing an extra £15 billion in June. He said the security environment was the most threatening he had experienced, citing Russian submarine activity, cyber attacks and the proximity of war in Europe following Russia’s invasion of Ukraine.

Woodburn said modern warfare had changed markedly, with Russia and Ukraine becoming highly capable in drone and counter-drone operations, increasing the need for deterrent and defensive capabilities. His comments came after former defence secretary John Healey resigned over funding concerns and was appointed Chancellor; BAE shares rose 3.25% amid expectations of further spending, while the Ministry of Defence extended BAE’s next-generation combat aircraft development contract by £708 million.