The United Kingdom will be required to make financial contributions to participate in the European Union’s newly launched €150 billion Security Action for Europe (SAFE) defence fund, under plans aimed at strengthening European military capabilities in response to escalating security threats, particularly from Russia.
The SAFE initiative, introduced in May 2025, is designed to boost joint military procurement across Europe by offering loans to EU member states and select non-EU countries, enabling them to purchase advanced defense technologies such as drones and missile systems. The fund is part of the EU’s broader ambition to mobilize €800 billion in defence investment by 2030.
UK Prime Minister Sir Keir Starmer had announced Britain’s intention to join the SAFE programme during a bilateral summit in May, presenting the move as a reset in UK-EU relations. He emphasized that participation would open new opportunities for British defense manufacturers and support domestic employment.
However, according to EU diplomats, the UK will be expected to reimburse Brussels for access to the fund. The contribution would reflect the economic benefit UK firms receive when they win contracts under the scheme. A mechanism will be in place to ensure a “fair balance” between the contributions made by third countries and the advantages they gain.
Negotiations are ongoing to determine the exact financial terms of UK participation, but diplomats confirmed that the same rules would apply to other third-party countries such as Canada, requiring contributions proportional to contract benefits.
To be eligible for funding, at least 65% of the components of any defence product must originate from SAFE member countries. The SAFE bloc currently includes EU nations, Ukraine, Iceland, Liechtenstein, Norway, Switzerland, and any third country that signs the necessary agreements.
Britain has already signed a general EU-UK security and defence partnership, and a second, more detailed agreement on SAFE participation is expected once the EU finalizes its negotiating mandate. The deadline for submission of funding proposals is November 2025, and loans will be awarded by the European Commission.
Inside negotiations, France is reportedly pushing for a higher UK contribution, seeing SAFE as a key tool to expand the EU arms industry. Germany and others are seeking a more balanced approach to avoid deterring British involvement. One senior UK official described the negotiations as “tricky,” while another EU diplomat emphasized the importance of maintaining long-term strategic cooperation over short-term political interests.
Thomas Regnier, spokesperson for the European Commission on defence, confirmed that without a separate agreement, UK companies can contribute up to 35% of a SAFE-funded defence product. A larger share would require a specific financial and supply arrangement with the EU.
A spokesperson from the UK Cabinet Office stated:
“It is in all our interests for the UK and EU to bring together our unique capabilities and expertise to make Europe a safer, more secure, and more prosperous place.”
The SAFE fund is a cornerstone of the EU’s evolving security policy, aimed at streamlining procurement, reducing duplication, and leveraging collective buying power to lower costs and strengthen defence integration across Europe.
