05 January 2006 | Anusha Bradley

British defence suppliers must upgrade staff skills and change the way they do business to meet the needs of the armed forces.

Speaking at the launch of the defence industrial strategy white paper, Lord Drayson, minister for defence procurement, said suppliers must become "leaner, more efficient and provide value for money" for Britain to stay competitive, meet future needs and maintain security.

The document provides suppliers with details about what defence technologies the government intends to buy in the next 10 years, and in the longer term.

John Reid, secretary of state for defence, said the technology and talent needed to build and service weapons, aircrafts and ships must remain in the UK. But more basic manufacturing, such as ship hulls, could be sourced from overseas.

Reid said the MoD envisaged using more unmanned vehicles and aircraft in 30 years' time, and suppliers must start planning now.

Drayson added that delivering the strategy will require "substantial changes" and industry and the MoD must form a partnership.

The MoD will increase its orders so suppliers have the resources to make the changes - such as staff training and research into new products and services - in return for reduced costs.

SMjan2006