When Hoon was Minister he stated that as BAES' Shareholders' Register showed >50% registered outside UK, it would not be considered to be British by patrimony, and would have no preferential claim to business. Best value open bids, best man wins.
When Wedgie Benn was Minister of Technology from 1965, he was responsible for automatic data processing, where UK had consolidated into ICL. Honeywell had won the mainframe for UK's first digital flight simulator (Redifon Air Trainers Ltd. RN Buccaneer) and ICL screamed. He carried in Cabinet a 25% Buy British premium for mainframes bought on public sector account. So if the offshore kit was £100, ICL would win at £124.99 and Treasury would uplift Project approved funds by that increment. ICL lapsed into fat, dumb privilege, was Nationalised, but soon expired.
The point about money staying within UK when home-sourced, so free, is rejected by Treasury whenever it is presented as the case for discarding a lower-priced import. Anywhere, not just in Aero. They require each line item of spend to be at best value. Greater minds than ours (e.g: theirs) attend to the Exchanges. If Treasury were to accept, say Plod's motors will be home-grown, then every public Buyer would be required to Protect the local firm, who would become...fat and dumb. We believe in Free Trade. Unlike, say US, we also (try to) do it. Do you remember a We're Backing Britain campaign in the 1960s, targetting private cars. A consequence was Austin Allegro, Morris Marina and the death of the UK mass-market car.