Security Resilience Fund Purpose and Structure
Purpose
The purpose of the Security Resilience Fund is to provide much-needed finance to SME manufacturers within critical supply chains. These critical supply chains include but are not limited to, Defence and Security, Critical Minerals, Critical National Infrastructure (communications, logistics and technologies), food and energy security and key utilities; they will include dual use goods.
The problem
At present, there are at least two challenges that limit the extent to which critical supply chains can adjust rapidly to emerging threats:
- Under-resourcing of core capability at a governmental level. This is a function of budgets and procurement processes.
- The risk that critical supply chains will not be able to increase production and supply because of vulnerabilities in their lower tiers where smaller businesses are more exposed to lack of working capital to service contracts. This restricts their capacity to scale up production quickly.
Why is this happening?
This is happening because:
- On the demand side, governments are fiscally constrained at present and cannot scale domestic budgets sufficiently quickly to enable preparedness in critical supply chains and critical national infrastructures.
- On the supply side, banks are restricted by compliance and shareholder preferences in terms of their capacity to provide working capital into deep tier critical supply chains (especially defence and security) because their risk profiles are financially and reputationally too high.
The Security and Resilience Fund Committee
The Security and Resilience Fund Committee provides the introductions, support and accreditation for banks receiving government guarantees in support of Critical Supply Chain finance. The Committee’s goal is to make supply chains more resilient through access to working capital and deep tier supply chain finance. This approach enables economies to grow the defence, security and critical infrastructure manufacturing base so that it is prepared for to meet increased the demand for defence and security equipment and services that is currently the reality of our times.
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