D Insights
Feb 15, 2023

January Observations

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One of the great privileges at the D Group is that we get to participate in briefings with a range of exciting speakers spanning core themes across National Security, Infrastructure, Space, Innovation, Sustainability and more. Over the last month, we noticed three insights that came from distinct sectors that reflect major D Group interests: the energy crisis, supply chain resilience, and the updating of the Integrated Review. 

On the energy crisis, we were struck by the insight that although the energy crisis continues to be a concern to all sectors, the vulnerabilities within the UK's energy security long predate Russia’s invasion of Ukraine and as a result will not be resolved once the conflict is over. There is no doubt the war has exacerbated the crisis, but we cannot ignore the fact that we were already heading towards an energy crisis. Russia’s action's have led to the inevitable fear that energy has now been ‘weaponised’ – which leaves us with an enduring vulnerability that can be exploited again in the future.

The challenges in energy have had been reflected across every facet of global supply chains. In every sector, what we used to regard as secure and resilient supply chains have proven to be anything but secure or resilient. Beset by challenges as diverse as the pandemic, tankers blocking the Suez canal and the impact of military action – in Ukraine and beyond – supply chain disruptions have created second-order economic and social pressures globally. Critically, we need to rethink the concept of resilience of supply chains, how we approach risk mitigation – and what we are prepared to pay for it, and therefore also the way we plan and execute ‘just in time’ models. Once again, just as in energy, the capacity for global disruption across all supply chains is no longer a veiled threat, but a reality we need to protect against.

Alongside these discussions, we also heard a different tone in the language being used to describe what the upcoming revisions to the Integrated Review might bring. As a statement of British policy on national security, the Integrated Review is a critical ‘direction-setter’ for future priorities and a response to changing geopolitics and technology, and to emerging threats. In discussions on this issue, we heard a subtle but potentially important shift in tone. Some of those involved have suggested amore focused effort from the military to adopt a new priority to ‘protect the nation and enable it to prosper’. This is a clear indication that economic prosperity needs to be central to the Integrated Review ‘refresh'.

Taking these three independent insights together, we are keen to see whether the Integrated Review will include a more specific effort to address the vulnerabilities in our supply chains in order to protect their resilience in the future. If not, we would be left to wonder who will be expected to set policy in these areas. In either scenario we are intrigued to see what role the private sector will need to play. 

Bringing the insights right up to date, last week’s announcements of changes to the machinery of government - bring an added level of intrigue - with energy once again having its own department, and the creation of a merged Department for Business and Trade - will these interconnected issues end up being driven independently by three separate departments, or are we going to see a level of integration and aligned thinking that the challenges seem to warrant? At the D Group we will continue monitoring developments and the government’s response over the coming months, with a keen eye on the Integrated Review refresh and policy focus for the newly formed ministries… 

The views expressed in this podcast are those of the contributors and do not reflect the views of The D Group.  

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