As the UK government announces a further £15bn for defence and pledges to raise military spending to £80bn a year by 2029, new analysis by Action on Armed Violence (AOAV) reveals that the average chief executive of Britain’s five largest defence companies received £5.2m in remuneration in 2024, more than 138 times the annual earnings of the median full-time UK worker.
The findings come as ministers commit to the largest sustained expansion in defence spending since the Cold War, raising fresh questions about who stands to benefit financially from Britain’s rearmament.
The companies assessed were BAE Systems, Rolls-Royce Holdings, Babcock International Group, QinetiQ Group and Serco Group. The figures from these companies financial reports were compared to the figures published by the Office for National Statistics for the median UK salary which in 2024 was £37,430.
This article is the first in a four-part analysis into defence company CEO’s remuneration, its findings are based on a review of annual reports and remuneration disclosures from the UK’s 10 largest publicly listed defence companies between 2014 and 2024.
Across NATO, governments are under growing pressure to rearm in response to Russia’s invasion of Ukraine and wider geopolitical instability, creating long-term commercial opportunities for major defence contractors. In February 2025, the UK government committed to raising defence expenditure to 2.5% of GDP by 2027, describing it as the biggest sustained increase in military spending since the Cold War, with ambitions to reach 3% in the following parliament.
Among the companies analysed was Rolls-Royce Holdings, where chief executive Tufan Erginbilgic received inflation-adjusted remuneration of £4.3m in 2024, including more than £3.1m in bonuses, share awards and benefits.
At Babcock International Group, chief executive David Lockwood received £4.09m in 2024, of which more than £3.2m came through performance-related incentives and additional benefits.
The highest-paid executive identified in the analysis was Charles Woodburn of BAE Systems. He received total remuneration of £12.2m in 2024, including more than £10.9m in benefits and long-term incentive awards. Prior research by the High Pay Centre found Mr Woodburn ranked seventh among all FTSE 100 chief executives during the 2024-25 financial year. Charles Woodburn’s £12.2m remuneration package was also nearly three times larger than those received by the chief executives of Rolls-Royce Holdings and Babcock International Group.
While high executive pay is common among Britain’s largest corporations, AOAV found defence sector remuneration was higher than average FTSE 100 standards. According to Deloitte, a management consultancy firm, median CEO remuneration across the FTSE 100 stood at £5.01m in 2024, placing defence executives consistently within the upper half of Britain’s biggest listed companies.
A rising tide?
There has also been a sharp rise in executive remuneration over the past decade. From 2014 to 2024, remuneration for CEOs of the top 10 defence companies increased on average by £1.53m in each company, even after adjusting for inflation.
At Serco Group, former chief executive Rupert Soames received £1.05m in remuneration in 2014. By 2022, his final year in the role, that figure had risen to £5.03m. Former Rolls-Royce chief executive Warren East saw his remuneration increase from £2.9m in 2016 to £4.41m in 2022.
We also tracked the cumulative wealth accumulated by senior executives over longer periods. Serco’s chief executive has received a combined £42.1m between 2014 and 2022, while the head of BAE Systems received some £56.6m between 2018 and 2024.
AOAV’s findings coincide with the publication of the government’s new Defence Investment Plan, which allocates an additional £15bn to defence, taking annual defence spending to £80bn by 2029. Although ministers describe the investment as essential to national security, the package remains below the £28bn reportedly sought by the Ministry of Defence and has been criticised by military figures as insufficient to meet Britain’s future capabilities. At the same time, the expansion in defence budgets creates substantial long-term commercial opportunities for the country’s largest arms manufacturers.
Earlier this month, British Defence Secretary John Healey resigned, followed by armed forces minister Al Carns and two aides, in protest at the government’s refusal to commit more funding to defence amid growing security threats and rising military spending pressures. The growth in defence-sector wealth reflects a wider shift in public priorities, as governments divert increasing resources towards military procurement. This applies a deeper pressure on welfare and overseas aid budgets.
But – as AOAV’s analysis reveals – the sheer scale of profits and executive rewards now flowing through the sector, particularly as arms exports to conflict regions remain politically contentious, raises questions as to whether the British tax payer is subsidising a pay bonanza amongst arms company chiefs.
Previous AOAV research has examined the relationship between British defence companies and countries accused of human rights abuses, including a 2024 report into BAE Systems’ overseas dealings available.
Who really benefits?
As governments commit to long-term rearmament programmes, the profitability of major defence firms, and the rewards flowing to their leadership, are likely to increase further.
These findings raise substantial questions about inequality, public spending priorities and the relationship between corporate profit and conflict. At a time when defence budgets are growing rapidly, greater public scrutiny of who benefits financially from militarisation paid for out of the public purse should become increasingly important.
For AOAV, this is not simply a story about executive pay. Our work documents the human consequences of armed violence and, as governments commit ever larger sums to military procurement, it is essential to understand not only how those weapons affect people when they are used, but also the financial incentives that underpin their production.
Transparency over who profits from expanding defence budgets forms part of a wider conversation about accountability, responsible arms transfers and ensuring that the snowball momentum of the military-industrial complex does not eclipse consideration of the civilian costs of war.
As Iain Overton, executive director of Action on Armed Violence, said: “These figures reveal the extraordinary wealth now concentrated at the top of Britain’s defence industry. At a moment when governments are pouring billions into rearmament, the public has a right to ask who ultimately benefits from this expanding military-industrial complex.”
The issue also connects directly to the protection of civilians, which lies at the heart of AOAV’s work. Weapons produced by major defence contractors are ultimately deployed in conflicts that can have devastating consequences for civilian populations, whether through direct violence, explosive weapons use in populated areas, or the prolongation of armed conflicts. As military spending rises and defence companies secure larger and larger contracts, there is a growing need to ensure that commercial success is accompanied by robust scrutiny of the humanitarian impacts associated with arms production and transfer.
We believe that examining the concentration of wealth within the sector helps illuminate the broader political economy of war, and raises important questions about how public spending has to be balanced between military expenditure, conflict prevention, civilian protection and post-conflict recovery.
Methodology
AOAV examined annual reports and director remuneration disclosures from 10 UK public limited companies operating within the defence sector between 2014 and 2024. The companies included BAE Systems, Rolls-Royce Holdings, Babcock International Group, QinetiQ Group, Serco Group, Chemring Group, Cohort, Meggitt, Ultra Electronics Holdings and AWE. All figures were adjusted for inflation using the Bank of England inflation calculator.
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