Spending Review: Reeves promises UK will become defence ‘superpower’
Chancellor Rachel Reeves has pledged the UK will become a “defence industrial superpower” as she confirmed military spending would rise to 2.6 per cent of GDP (gross domestic product) by April 2027.
Unveiling the government’s much-anticipated Spending Review, Reeves told the House of Commons: “A new era in the threats we face demands a new era for defence and security.
“That’s why we took the decision to prioritise our defence spending by reducing overseas development aid so that defence spending will now rise to 2.6 per cent of GDP by April 2027 including the contribution of our intelligence agencies.”
The uplift will give defence secretary John Healey £11bn to play with as the UK looks to tackle Donald Trump cutting US military spending in Europe.
“That investment will deliver not only security, but also renewal in Aldermaston and Lincoln; Portsmouth and Filton, on the Clyde and in Rosyth. Investment in Scotland [and] jobs in Scotland,” Reeves added.
No mention of major target in Spending Review
But there was no mention of a further target of three per cent GDP by 2034, which the government has refused to label an ambition or a firm commitment.
Paul Johnson of the Institute for Fiscal Studies said it was safe to assume there would be “no progress” towards that aim until the end of parliament.
The government is under pressure by NATO to increase defence spending to 3.5 per cent of national income after European countries argued pledges made in the recent Strategic Defence Review were not enough.
Johnson added: “The Chancellor again says increased defence spending paid for by reducing overseas aid. Not really the case.
“Almost all the extra defence spending is capital. The overseas aid cut is really being used to top up day-to-day spending of other govt departments.”
Some £4.5bn will be invested in munitions in Glasgow, Glascoed, Stevenage and Radway Green. Around £6bn will be spent on upgrading nuclear submarine production in Barrow, Derby and Sheffield.
Reeves said: “We will make Britain a defence industrial superpower. With the jobs, the skills and the pride that comes with that.”