LONDON (Reuters) - Prime Minister Rishi Sunak said on Tuesday he would increase defence spending to 2.5% of GDP to reach 87 billion pounds ($108 billion) a year by 2030.
WHY IT'S IMPORTANT
Ukraine has repeatedly called for more Western to support to fight Russia. Domestically, Sunak has been under pressure from within his Conservative Party to pledge more defence spending ahead of a national election due later this year.
BY THE NUMBERS
The cost of the commitment would be an additional 4.5 billion pounds by 2028/29, taking defence spending from approximately 73.8 billion pounds to 78.2 billion pounds.
This would be funded by a previously-announced plan to reduce the size of the civil service, saving 2.9 billion pounds, and 1.6 billion pounds allocated to defence research and development from an existing increase in overall R&D funding.
In line with budgetary conventions, the government did not set out how it would fund the changes after 2028/29 as that would take it beyond the horizon of official fiscal forecasts.
YEAR NEW SPENDING OLD NEW SPENDING OLD SPENDING
(BILLION STG) SPENDING(BILL (% OF GDP) (% OF GDP)
ION STG)
2024/25 64.6 64.1 2.32 2.3
2025/26 67.5 66.1 2.35 2.3
2026/27 71.0 68.7 2.38 2.3
2027/28 74.5 71.2 2.41 2.3
2028/29 78.2 73.8 2.44 2.3
REACTION
TORSTEN BELL, CHIEF EXECUTIVE OF THE RESOLUTION FOUNDATION THINK TANK
"This is a lot easier to announce than deliver." He said Britain's budget plans, even before Tuesday's announcement, were based on huge cuts to future public spending that most economists think are undeliverable.
"The degree of fiscal commitments, fictions being built up for after this election is a real problem. "
JOHN HEALEY, OPPOSITION LABOUR PARTY'S SHADOW DEFENCE POLICY CHIEF
"Labour wants to see a fully funded plan to reach 2.5 per cent, but the Tories have shown time and time again that they cannot be trusted on defence and we will examine the detail of their announcement closely.
"The British public will judge ministers by what they do, not what they say."