Statistics show UK defence spending fell below the NATO target of two percent of GDP in the last financial year.

Recently, the Commons Public Accounts Committee said it was “very concerned” that the £178 billion equipment plan was at risk, citing a fall in the value of the pound against the US dollar leading to “cost increases” for equipment coming from the states.

The figures show that for 2015-2016, the Government spent £36.5 billion which was £5.6 billion less than in 2010-2011.

Earlier in the year, the International Institute for Strategic Studies claimed that British defence spending was 1.98% of GDP in 2016, below the 2% target set out by NATO. This was denied by the government at the time.

In 2006, NATO allies set a target to spend 2% of Gross Domestic Product on defence. The UK oftens meets this target but when reporting its defence expenditure to NATO, the UK now includes several items of expenditure which had not previously been included.

IISS director general John Chipman said:

“In 2016, only two European Nato states – Greece and Estonia – met the aim to spend 2 per cent of their GDP on defence, down from four European states that met this measure in 2015. The UK dipped slightly below this at 1.98 per cent, as its economy grew faster in 2016 than its defence spending.

Nonetheless, the UK remained the only European state in the world’s top five spenders in 2016.

If all Nato European countries were in 2016 to have met this 2 per cent of GDP target, their defence spending would have needed to rise by over 40 per cent.”

Recently, Labour MP Wayne David claimed that the 2% target was being met including retired personnel’s pensions, the government have so far declined to comment on this.

The United States has repeatedly called on European allies to contribute more and in recent years NATO’s Secretary General described declining European defence budgets as unsustainable when compared with increased Russian spending on its military.


  1. If there was an opposition worth its salt on defence the Gov would never get away with it. But there isn’t so Gov not held to account at all. Worse choice this election for strong defence in a long time.

    • If we had a balanced press the government could be held to account. If it was a Labour government presiding over this the right wing press would – rightly – be making a lot of noise about it. Instead we have silence.

      • Sorry HF, this is not the fault of the press – it’s politicians who are to blame and right now IMHO all the parties are failing pretty abysmally on the defence of the realm.

          • Hi HF, If the bias was as you say, that would suggest they should be strong on defence. Times & Mail both tried to raise issue but no opposition support to leverage so goes nowhere. Where are Guardian, Observer, Indy, Mirror on subject? Hardly right wing and they are largely silent. Why, because Labour front bench is MIA.

  2. No surprise there, I think most people who analyse these figures knew this fact a long time ago. The UK government has been covering up a real terms reduction in defence expenditure and using the Foreign Aid budget bundled into the defence budget to hide this. Definitely a case of smoke and mirrors spending declarations.
    I just wish HMG would come clean to this fact and then apologise for all the cuts and make amends with some declaration to fill the capability gaps that have occurred in our armed forces as a result of not maintaining 2% GDP to defence expenditure. £10 billion as a direct injection into defence would go a long way to resolving some of the capability gaps either current or pending.
    £100 million- forward repair and heavy engineering ship (bought 2nd hand) to replace the quietly scrapped RFA Diligence
    £350 million- to equip the entire frigate and destroyer fleet with Norwegian anti-ship missile
    £500 million- to repair all the type 45 destroyers propulsion problems and at the same time as in dry dock to fit them with mk 41 vl silos- making them true multi-role light cruisers- ideally remove 4.5 inch gun and fit 5inch gun instead
    £1 billion for 8th astute class submarine- just a little expansion of shipyard capacity at Barrow could facilitate the construction of the 8th astute
    £2 billion for 10x type 31 frigates- these ships are much needed to bring back hull numbers and critical mass to the RN
    £400 million to increase RN manpower by 5-10,000 personnel
    £1 billion for a squadron of osprey aircraft for carrier deployment, air to air refuelling and vip/ special forces transportation
    £1 billion to construct x2 new purpose built lphd vessels to replace hms ocean and ensure the RN has always got an available helicopter assault ship for amphibious operations. It is insane to propose using a £3billion QE strike carrier for this purpose.
    £2 billion to construct a 2nd batch of type 26 frigate optimised for air defence and surface strike- ideally aiming to get 4 ships in service for a unit cost of £500 million each, these vessels to supplement Type 45’s allowing type 45’s to potentially also be able to offer some limited BMD capability for the UK.
    £1 billion to design and develop the next generation of MBT for the British army- “challenger 3”- let’s see if our materials science is able to get something revolutionary into service that can match and beat the Russian Aramata series.
    £10 billion is not a huge amount of money in the big scheme of things and would make any British citizen who knows a little about defence matters sleep sounder in their bed not worrying about the state of our armed forces.

    • No way 10 T31’s will be £2b…

      Some good ideas in there though. We need hulls in the water, so T26 and T31 key to that. Strengthening the firepower of what we have is an absolute priority as there are some startling gaps in capability.
      Our tank industry is hugely underfunded but I don’t think a Challenger 3 is the way to go. Time to go next gen and jump in with the Germans on joint development of a tank for Europe. Unlike the Eurofighter I think there’s more overlap on what the various armed forces actually want in a MBT, so more chance of success. With fundiung tight everywhere, it would maybe ensure a better MBT for everyone than several countries going it alone.

      I can’t make my mind up if I’d like to see us have a smallish fleet of AIP diesel subs. We have a large coastline and our local waters, potentially hostile ones, would give us great capability in that regards. It would free up Astutes for wider-ranging deployment

    • I like your list, I like it a lot. You’ve hit pretty much all the issues I have on my list, almost a perfect overlap with my list, but I question some of your numbers as too low. My specific concerns/questions re your costs are…

      I can’t see a £200m T-31 being anything more than a pimped OPV. I would say that at least £350m per hull is what will be needed to make it at all credible.

      £1bn for an 8th Astute seems low when it has recently been reported that the latest Astute contract was for £1.4bn

      I would be surprised if £1bn covered 2 x LPHD unless they are very small and built to commercial standards. According to Wikipedia the Juan Carlos cost 462m Euro which is about £390m but that was ordered in 2003 so I would expect a ship of similar size, which in my view is what we should be building, would be 50% to 100% more expensive after 14 years of inflation (defence cost inflation not RPI) so a pair would be more like £1.2bn to £1.5bn to build.

      Next batch of T26 AAW variant at £500m each. I don’t see that as realistic but maybe I’m wrong. I strongly support the idea of using the T26 design as the basis for T45 replacement but would like to start that process with batch 1, i.e. make sure they are capable of hosting a next generation Sampson radar or equivalent and build even batch 1 with an all-Mk41 forward VLS silo (hopefully 48 could be fitted in) for more capacity for longer range surface to air and anti-balistic missiles. This last point might well be a specification rather than a design issue since I suspect the RAN want all Mk41 up front so there is probably already a variant of the T26 design for the RAN bid that supports this.

      It’s all so frustrating though because that £10bn could be found by, after the election, declaring that the UK was committed to playing its part on the world stage as one of the biggest aid providers to the world but that, due to immediate domestic circumstances, would reduce the current aid budget by 30% over the term of the next parliament to address critical resource issues at home. That would release about £4bn a year for 5 years, £20bn total. Allocate half of that to defence and half to NHS and social care and there is your £10bn straight away. Make the temporary aid cut deeper or make the cuts stay in place across 2 terms of parliament (perhaps at a slightly less deep rate for the second term) and even more money could be put on the table.

    • Excellent list.

      Even including the Osprey, though I’d like buddy to buddy capability as well for refuelling the F-35B.

  3. For those of us already irritated about how oversized the aid budget is vs defence and how badly some of it is spent (more on that in a minute), this adds more fuel to the flames.

    There are two budgets pegged to our GDP, defence at 2.0% with lots of dodgy accounting to get us there (and even then failing it seems) and aid at 0.7% where that is written into law so if it look like there is going to be a shortfall for a year the remaining aid money that needs to be spent seems to simply get thrown at whatever they can find.

    The 0.7% aid target is taken so seriously that totally unworthy year-end projects are funded yet the 2.0% defence target, already far too low, is one that HMG seems OK with missing. This is all totally wrong.

    • I agree that the defence budget needs to be increased and the stated amount. Taking the money from foreign aid would not however be great idea now that the UK is looking for more trade with the rest of the World that we were somehow denied as members of the EU. Foreign aid is a vital aspect of the UK’s soft power and will play an important part in influencing future trade negotiations, particularly with developing countries. There is no doubt that some of it could be better spent and better allocated but its also reasonable to point out that billions have been wasted by the MOD in recent years. Perhaps once the MOD stops wasting billions of the <2% of GDP (after you take out pensions etc) that it currently gets on overdue, overpriced (hello BAE) and overbudget projects, then there can be a conversation about reallocating foreign aid cash to defence. The chances are that any money taken from the aid budget would in any case head to areas that are just as desperate for it such as the NHS, local Government and others.

  4. Unfortunately there is no appetite for increased defense spending in the UK as a whole, the general public will gladly let standards slide during peacetime with a complicit media until we’re down shit creek then everybody cares all of a sudden, it’s happened for the last 100 years and I can’t see it changing anytime soon.

    Although to be fair everything is underfunded at the moment, NHS, welfare, public services.

    There needs to be a clear strategy about procurement so every capability gap is filled and every commitment fulfilled, that surely has to be the aim.

    I said it on another thread about the Nuclear deterrent and us not affording it and the reply was it costs £2b a year to run, well that’s fine but it doesn’t cost £2b to set up does it, what is it? £40b estimate and the rest, that’s an entire year of our defense budget. We don’t have the population and resources to have an economy large enough for both a nuclear deterrent and 3 well equipped branches of the armed forces, only the USA and China do, the money just simply isn’t there.

    The politicians only care about the deterrent to stay in the ultimate political club and don’t really care about the state of the armed forces because the general public don’t care, and the small section of the public who do care want both. It’s a vicious circle.

    • Hi Kieran,
      The costs for Dreadnought program is £31b over 15 years, so c£2b pa.
      It really is not the reason everything else is short..
      Underfunding & political spin are the problems.

      • Cheers Ian,

        Yeah fair enough, just had a little read about it, so the £40b is with that £10b contingency on top that’s where that comes from, and there is a good chance it will be over budget. So that’s not including the running costs, decommissioning Vanguard class. Also the Trident missiles need replacing in the 2040’s slap bang in the middle of their lifespan. So while I understand where people get the £2b pa from, realistically it’s going to be a lot more than that. And that is a massive chunk out of our budget.

        I agree though it’s not the reason why we are short on everything else, I just personally think it would be helpful for people to make the right choices with a bit more leeway in the budget without an expensive vanity project in it.

      • My own wish would be to have a Nato nuclear deterrent, all 28 members chip in with the cost, build, running, maintenance, multi-national crew under Nato command as the ultimate deterrent for every member, with all three ways of delivery as well.

        • ‘multi-national crew under Nato command as the ultimate deterrent for every member’

          You’ll have to back over 50 years but I remember an attempt at this described as ‘mixed manned mid summer madness’ in The Navy’ when this was attempted in the 60’s. There is no chance of the 3 nuclear armed nations in NATO allowing this in any case, and many NATO nations don’t want direct control over nuclear weapons.

          • Yeah in the 60’s, the level of cooperation now is incomparable to the 60’s. Cant argue with the last two points though.

          • There is also a fundamental principle at stake; that of not outsourcing your own defence. Partnering, cooperating, article 5 etc all good, but its what should happen once we’ve got our own house in order.

  5. Another solution may be an act of parliament which stipulates minimum numbers of troops, ships, tanks and aircraft rather than the current 2%.

    To add to the previous list which is very good 250 typhoons akin to the current f18 which is much larger than the original version.

  6. The problem is that the government speaks about defence funding as though it were the same thing as actual defence. It’s not. Rather than focusing on the magic 2% number, we should be pressing the government to close capability gaps. Clearly, many of who read articles on this website know where those gaps are.

  7. Julian and others thanks for replies and general sentiment on this issue. I think mostly we are all singing on the same hymn sheet.
    Just re reading warships ifr and jane’s online and most naval experts are saying a moderately capable type 31 frigate will cost approx £350 million a piece. Still much cheaper than the £1 billion a piece type 45 and type 26 ships. Why is it every major warship in recent years costs a billion pounds?
    something interesting though is that 7 years ago when the 8th+potentially 9th astute class hulls were likely to be scrapped BAE systems said they would sign a contract to get the vessels built for £500 million each. A bargain i would say, especially if enforced by contract and all overspend paid for by BAE. HMG however turned this offer down. Just stupidity.
    I still think a decent cash injection of £10 billion would plug quite a few holes in defence capability.
    Interesting to note the Australians built under license their Canberra class lphd in Aus for £3billion Aus dollars= £1.2 billion pounds= £600 million per hull, pretty reasonable for a purpose built lphd of 27,500 tons and able to transport and land 1200 marines.
    Time for spreadsheet Phill to put his hands in his pockets.
    also agree the government should send a clear message to NATO and our weakling allies in the EU that we are serious by making it law to spend no less than 2% gdp to actual defence budget. Not including flippin foreign aid or military pensions.

  8. Today really had me shaking my head.

    UK military so poor and naive in their lobbying.

    Open Letter with poor presentation the same day as NATO Jens meets TM saying ‘UK leading defence in Europe’.

    Where are the political professionals for goodness sake…


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