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Rachel Reeves is set to unveil a £2.2bn boost for the UK’s defence spending at the Spring Statement, including cash to kit out Royal Navy ships with laser weapons.
The Chancellor vowed to deliver “security and national renewal” but warned “we have to move quickly in a changing world” amid rising uncertainty over future European defence.
Reeves will announce £2.2bn for the Ministry of Defence (MoD) as she delivers her keenly awaited fiscal update in the House of Commons on Wednesday, which is expected to include spending cuts to some government departments as the Treasury grapples with economic difficulties.
She is expected to tell MPs the funding is a significant step towards the UK’s new commitment to increase defence spending to 2.5 per cent of GDP from April 2027, as the Prime Minister Sir Keir Starmer announced last month.
Cash will be invested in refurbishing homes for military families, advanced technology for modern warfare, the Treasury said, including fitting Royal Navy ships with directed energy weapons by 2027, which emit lasers or radio frequencies to hit a £1 coin a kilometre away.
The money comes via the Prime Minister’s cuts to the international aid budget and from the Treasury reserves, and will also help fund infrastructure upgrades at Portsmouth naval sites.
Reeves: ‘Active government’
Reeves is expected to say: “This government was elected to change our country… that work of change began in July – and I am proud of what we have delivered in just nine months.
And she will add: “Now our task is to secure Britain’s future in a world that is changing before our eyes. The job of a responsible government is not simply to watch this change. This moment demands an active government stepping up to secure Britain’s future.”
The Chancellor will highlight Sir Keir’s previous defence announcement, including the ambition to spend three per cent of GDP on defence in the next parliament, calling it “the right decision in a more insecure world”.
She will describe her own announcement, from April, as an “increase in investment” and a “further downpayment on our plans to deliver 2.5 per cent of GDP… not just about increasing our national security but increasing our economic security, too.
“As defence spending rises, I want the whole country to feel the benefits.”
Defence cash boost
Treasury officials say the plan will also involve leading manufacturing and technology sectors creating jobs across the country.
It will take the UK’s defence spending as a share of GDP to 2.36 per cent in 2025-26 while being fully funded and requiring no increase in borrowing.
Defence secretary John Healey called it a “significant increase in defence spending” and said: “National security is the bedrock of a successful economy.
“This investment will make Britain stronger and safer in a more insecure world. And it will ensure defence is an engine for growth, creating good jobs across the nation.”
But Mel Stride, shadow Chancellor of the Exchequer, said: “Our national security demands a strong economy. Yet since Rachel Reeves’ first Budget, growth is down, borrowing is up and business confidence has been destroyed.
“Labour broke their promises to pensioners on winter fuel payments, and to farmers and businesses with crippling tax rises that have pushed up inflation and interest rates.
“The Chancellor should use the emergency budget later today to fix her own mistakes and end Labour’s war on enterprise.”
