The UK government is introducing procurement reforms that would increase profits for defense contractors delivering projects on time while reducing guaranteed returns for underperforming suppliers. Proposed changes to the Single Source Contract Regulations would raise maximum incentive payments from 2 percent to 10 percent of contract costs for companies meeting delivery and productivity targets. The reforms also aim to make procurement more accessible to smaller firms by increasing compliance thresholds and introducing innovation incentives for self-funded defense technologies. Officials say the measures are intended to improve efficiency, encourage innovation, and strengthen the role of SMEs in Britain’s defense industrial base.
