Second Scottish DTEC at risk without Scottish Government match funding, MPs warn

• New report finds that opportunities from increased defence spending cannot be realised without a change in skills policy
• MPs urge UK and Scottish Government’s to work together with greater urgency to fund DTEC’s and expand training provisions

Scotland is well-placed to benefit from increased UK defence spending, but risks missing out if persistent skills shortages are not addressed, a new report by the Scottish Affairs Committee warns.

Defence skills gaps

Defence investment can create highly skilled jobs, strengthen supply chains and support economic growth across Scotland. However, the availability of a skilled workforce is key to determining whether Scotland can realise these benefits, and, crucially, support the UK’s defence and national security objectives.

Demand for apprenticeships and technical training is high, but today’s report warns that training provision is not keeping pace with future workforce needs – risking Scotland’s ability to deliver the UK’s defence strategy and realise the full benefits of increased defence investment. The report welcomes initiatives like the Defence Growth Deal and the Defence Universities Alliance but urges both governments to act with greater urgency to strengthen Scotland’s defence skills base.

The report highlights the potential of two proposed Defence Technical Excellence Colleges (DTECs) for Scotland, which are designed to deliver advanced technical skills for the UK defence sector. However, without matched funding from the Scottish Government, the UK Government has said only one college will proceed. Given the potential positive impact of DTECs, the committee hopes to see the Scottish Government provide match funding, as well as collaboration from both Governments to deliver the Colleges.

More widely, the report warns that progress on DTECs has “fallen behind” those in England and urges both governments to work together with greater urgency to develop Scotland’s skills base.

Unlocking SME potential

SMEs make up 98.2% of Scotland’s businesses, and the report argues that they must be better supported if Scotland is to benefit fully from rising defence spending. The committee heard that defence SMEs face significant financial risks and barriers to operation and calls for the MOD to improve opportunities for Scottish firms and encourage prime contractors to do more to support them.

Public perceptions of defence

The defence sector’s negative public image is one of its most persistent barriers to recruitment. While the Defence Industrial Strategy called for a national conversation about the importance of defence, progress has been limited. More needs to be done to improve public understanding of the industry’s role in creating jobs, driving growth and supporting national security.

There are also concerns that some SMEs have been de-banked due to their links to the sector. Today’s report urges the UK Government to work with the financial services sector to end this practice, warning that it undermines national security and job creation.

Chair of the Scottish Affairs Committee, Patricia Ferguson MP, said:

“Scotland has a world-leading defence sector and is well-placed to benefit from increased UK defence spending. However, unless long-standing skills shortages are addressed, this opportunity could be missed.

“One of the main ways skills trainings can be expanded is through DTECs, which have the potential to strengthen Scotland’s skills pipeline and expand access to high-quality apprenticeships that can support the UK’s defence ambitions. The committee hopes to see the UK and Scottish Government’s work together to deliver both proposed DTECs in Scotland and, more widely, that Scotland can accelerate work to develop the skills base its defence sector needs.

“It’s also important that Scottish defence SMEs get the support they need to grow. Removing barriers to defence supply chains and improving engagement with prime contractors will help unlock their full potential and help make sure the economic benefits of defence investment can be felt across Scotland.”