Thales UK boss: UK Government talking to private capital on defence funding

"We've got some good discussions with government of where we think there's a role to play (for private finance), and we're gearing up for that," Siveter said.

He said with credible long-term demand signals, pension funds, infrastructure investors and private equity would be prepared to invest billions needed on, for example, expanding manufacturing capacity.

One area he sees as ripe for private capital is on providing underwater surveillance capability to protect critical national infrastructure such as internet cables.