UK to raise defence spending to 2.5% of GDP by 2027

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Sir Keir Starmer has announced that UK spending on defence will rise to 2.5 per cent of GDP by 2027 and reach 3 per cent in the longer term.

The UK prime minister told MPs on Tuesday it would be the “biggest sustained increase in defence spending since the end of the cold war”.

His intervention came as he prepared to travel to Washington for talks with Donald Trump on Thursday about the future of Ukraine and the wider security of Europe. Trump has called for European countries to raise their defence spending.

Starmer told the House of Commons: “We must change our national security posture, because a generational challenge requires a generational response.” This will involve “extremely difficult and painful choices”.

He announced this would be funded by reducing the UK’s ringfenced aid budget from 0.5 per cent of gross national income to 0.3 per cent over the next two years.

Starmer also set out an ambition to raise defence spending to 3 per cent of GDP “subject to economic and fiscal conditions” during the next parliament — which is expected to run from roughly 2029 to 2033.

The prime minister has long faced calls to spell out when Labour would meet its manifesto commitment to increase defence expenditure from its current level of 2.3 per cent to 2.5 per cent.

Pressure has ratcheted up in recent weeks after the US president set out his intention to secure a rapid ceasefire in the Ukraine war, and cast doubt over his appetite to continue supplying significant American military support to Europe.

The increase will cost between £5bn and £6bn a year — equivalent to about 10 per cent of the core schools budget in England.

UK military chiefs have privately pushed for it to rise further to 2.65 per cent of GDP, which would be £10bn more each year than the current budget.

Starmer said defence spending would rise to 2.6 per cent of GDP after 2027, if expenditure on the UK’s intelligence agencies were included.

Earlier on Tuesday Conservative leader Kemi Badenoch called on the government to “repurpose” the aid budget to fund a rise in defence expenditure, and said that spending 2.5 per cent by the end of the decade was “now no longer enough”.

She said in a speech at the London-based Policy Exchange think-tank that she would back Starmer in “taking difficult decisions” to increase defence spending.