The new Labour government intends to increase defence spending to 2.5 per cent of GDP which is but has not specified a timetable. The current budget draft foresees an increase of 0.01 per cent of GDP by 2026.
The UK’s defence budget continues to meet NATO commitments, but long-term targets appear difficult to achieve due to economic and political uncertainty. The new government is likely to prioritise economic conditions and budget balances before implementing budget increases, which could mean pauses or changes to defence procurement programmes.
According to newly published data by the new Labour government based on projections from the Office for Budget Responsibility (OBR), UK defence expenditure would effectively flatline as a share of GDP until the fiscal year 2025-26.
Maria Eagle, Minister for Defence Procurement, revealed in a brief response to a parliamentary question on November 13 that defence spending is currently estimated to be 2.29 per cent of the UK's GDP in fiscal year (FY) 2024-25 and 2.30 per cent in FY 2025–26.
"Future FYs' figures are subject to the outcome of the second phase of the Spending Review," Hawkins stated.
This would result in essentially no rise in UK defence spending as a proportion of GDP during the first two years of the new Labour government, which theoretically still intends to boost it to 2.5 per cent of GDP but has yet to specify a timescale.
The former ruling Conservative Party, now in opposition following an election defeat in July of this year, had previously stated that it would increase defence spending to 2.5 per cent of GDP by the end of the next parliament or by 2030.
According to an October 28 House of Lords document on UK defence spending predictions, despite the Labour government's intention to boost the defence budget to 2.5 per cent of GDP, it remained "unclear over what period that increase will occur."
Furthermore, the document stated that ministers "have further indicated that difficult choices on defence spending may be required in light of current economic conditions".
