The UK needs “innovation at a wartime pace”, the Defence Secretary has said as he announced a new strategy for the industry.

As he launched a defence industrial strategy, which is being developed alongside the government’s strategic defence review, John Healey said war game exercises to test the military’s capabilities will be carried out with industry figures for the first time.

This will be the first defence industrial strategy since Russia invaded Ukraine, with the last version published in 2021, and it is expected to be published in the first half of 2025, with consultation open until the end of February.

War gaming is well established for the militaries, Mr Healey said.

“What we’re doing for the first time today is that approach, war gaming, but with industry figures.

“And the reason behind this is that we need together – government and industry – to be capable of innovation at a wartime pace,” he told journalists during a visit to the Honourable Artillery Company to see drone technology.

The war games will test how the military and industry deal with scenarios such as a conflict where protracted fighting disrupts supply chains and processes.

Asked if Britain is “war ready”, he said: “What I’m doing is recognising that our forces need to be better equipped.

“Behind them needs to be an industry that is better able to produce what they need and innovate at the pace of wartime pressures.”

The war in Ukraine has shown the cycle of obsolescence to be as short as six weeks on the front line, he said.

The industrial strategy framework also aims to direct British defence investment towards UK-based businesses to drive jobs and growth.

Defence AI company Helsing said on Monday it would mass produce its HX-2 drone as part of its £350 million investment into the UK over five years.

The drone uses AI (artificial intelligence) to identify targets and strikes are then confirmed by a human operator.

BAE Systems and Babcock have also announced plans to recruit thousands more people in the coming year, including through graduate and apprenticeship opportunities.

The Defence Secretary did not confirm when asked whether plans to set out the timeline for the UK to reach defence spending of 2.5% had been pushed back until June or if defence chiefs had asked him to get to the target by 2027.

The Government has committed to upping defence spending to 2.5% but has not said when it plans to reach that goal by.