London. Britain warned Russia on Wednesday that it was ready to deal with any incursion into its territory after the spy ship Yantar was detected on the edge of UK waters north of Scotland.

Defense Secretary John Healey said the Russian vessel had directed lasers at pilots of surveillance aircraft monitoring its activities.

“My message to Russia and to Putin is this: We see you. We know what you’re doing. And if the Yantar travels south this week, we are ready,” Healey said during a speech in London.

The Russian embassy in a statement accused the British government of being “Russophobic” and “whipping up militaristic hysteria," adding that Moscow has no interest in undermining the UK’s security.

Healey issued the warning as he made the case for increased defense spending a week before the government releases its new budget. While Prime Minister Keir Starmer has pledged big increases in military spending in the face of threats from Russia, China, and Iran, the government is facing tough choices as it eyes tax increases and spending cuts to close a multi-billion-pound shortfall in its finances.

Healey also announced plans to build at least six new munitions factories at sites from Scotland to Wales. The government in June committed 1.5 billion pounds ($2 billion) to build the plants, which it says will create at least 1,000 jobs, drive economic growth, and ensure that the military has a constant supply of explosives, propellants, and pyrotechnics.

British officials said the Yantar is part of the Russian navy, designed to conduct surveillance in peacetime and sabotage during times of war. Because of this, the UK and its allies track the ship and work to deter its operations whenever it approaches British territorial waters.

“It is part of a Russian fleet designed to put and hold our undersea infrastructure and those of our allies at risk,” Healey said, referencing attacks on pipelines and cables under the Baltic Sea earlier this year.

This isn’t the first time the Yantar has probed Britain’s defenses, Healey said. After a warning last year, the Yantar left UK waters for the Mediterranean. When the Russian ship later sailed through the English Channel in January, it was followed by HMS Somerset, a frigate assigned to homeland defense.

Healey said the UK must adjust to a “new era of hard power.” He cited the conflict in the Middle East, troubles between India and Pakistan, and Chinese spies targeting democratic institutions in the UK, as well as the war in Ukraine.

Britain in June pledged to increase defense spending to 5 percent of gross domestic product by 2035, in line with most other NATO nations. The commitment includes 3.5 percent of GDP on core defense spending, with another 1.5 percent on infrastructure projects designed to support the nation’s defense. The UK spent about 2.3 percent of its GDP on defense last year.

“This is a new era of threat. It demands a new era for defense, an era of hard power, strong allies, and of sure diplomacy,’’ Healey said. “And as the threat grows, Britain must step up, and we are.”