What constitutes "British" these days? Just watched a wonderful video called
"RAF in the 1950s" (get it off Amazon) Watching this you can see a huge industry that could justly claim to be British in all/most ways, ie design, testing, building, production etc.
However a succession of (mainly) Tory/Labour governments have consistently hit the armed forces/defence industry such as our military/industrial capability has been so reduced that the equations simply don't add-up any more, especially in terms of economies of scale.
If (any) government decided to design/produce an all-British strike-attack aircraft for example, it would cost several billions to get it to pre-production standard. Given the penny-packet way in which the RAF order aircraft the project would be totally unviable unless major overseas sales could be gauranteed.
The only realistic way is a total change in strategic/military thinking such as
Britain becoming a major power once again thus justifying a major all-round increase in military spending OR seeking collaboration with sundry nations to share the costs of small/medium power status.
The important point I suppose is that tens of thousands of skilled jobs would be a stake if we shopped around. To lose such a skills base, even much reduced on what it once was, would be a disaster.