UK facing a crisis in defense spending

UK Chief of Defense Staff Air Chief Marshal Richard Knighton this week gave a stark warning during testimony before a House of Lords committee. Knighton said the armed forces would have to “dial back” day-to-day training, exercises and operations unless the Treasury provided more cash. He also warned there was not enough resource funding for normal military activity in the coming months. This is a shocking indictment of the UK’s failure to properly invest in its defense and live up to its global role.

Knighton’s comments came only days after Defense Secretary John Healey resigned, arguing that the Treasury’s proposed financial settlement for defense would “reduce the readiness” of the armed forces and increase the risk to personnel on operations. When the country’s top military officer and the defense secretary are both warning that Britain lacks the money to conduct routine military business, the problem can no longer be dismissed as Westminster exaggeration. It is a national security crisis.

There is no doubt that the UK is facing a crisis in defense spending. This problem has plagued multiple governments since the early 1990s, when British leaders, like many NATO colleagues, embraced the so-called peace dividend after the Cold War. Money once spent deterring the Soviet Union was diverted to other government priorities and social welfare programs. The crisis became acute after 9/11 and the 2003 invasion of Iraq, when the then-Labour government tried to conduct major operations in Iraq and Afghanistan on a shoestring budget. When the Conservatives returned to power after the 2010 election, they promised to rebuild Britain’s military power but never fully matched rhetoric with resources.

The problem can no longer be dismissed as Westminster exaggeration. It is a national security crisis

Luke Coffey

This led to Britain’s armed forces personnel levels hitting historic lows. The British Army and Royal Navy are both broadly at their smallest size since the Napoleonic era, while the Royal Air Force is smaller than at any point since the end of the Second World War. And when recent fighting broke out between the US, Israel and Iran, the UK was left without a major warship in the Gulf, having ended its permanent naval presence there last year after more than four decades.

The timing of Healey’s resignation and Knighton’s explicit warnings could hardly be worse for the government. Ahead of this year’s NATO Summit in Ankara next month, the Americans have made it clear they will use the occasion to check every ally’s report card on defense spending. At last year’s NATO Summit in The Hague, the alliance agreed, at the behest of President Donald Trump, to a 5 percent of gross domestic product defense investment benchmark by 2035. This is divided into 3.5 percent for core defense spending and another 1.5 percent for defense-related infrastructure, resilience and security.

Today, the UK spends about 2.3 percent of GDP on defense, with formal plans to reach only 2.68 percent by 2030. In his resignation speech, Healey said Britain needed to spend at least 3 percent by 2030. Yet nobody in the UK political establishment has provided a credible explanation of how Britain will close the gap with NATO’s 2035 target.

This exposes the fatal flaw in Prime Minister Keir Starmer’s defense and security strategy since taking office in July 2024. He commissioned a comprehensive strategic defense review but then punted on the defense investment plan that was supposed to show how the government would pay for it. It made no sense to publish a defense strategy without the economic strategy needed to fund it. In doing so, the government did not produce a strategy. It produced a wish list. The Treasury’s failure to agree to a plan that properly funds Britain’s commitments has now placed the UK in a precarious position at a time of growing threats, especially from Russia in Eastern Europe.

Starmer’s premiership and leadership of the Labour Party are being tested by high-level resignations and potential challengers

Luke Coffey

The defense spending crisis is also piling pressure on Starmer at an already difficult political moment. His premiership and leadership of the Labour Party are being tested by high-level resignations and potential challengers.

With former Cabinet minister and Greater Manchester Mayor Andy Burnham winning the crucial Makerfield by-election on Thursday, he has not only implied that he could throw his hat into the ring for a leadership contest but also shown that he can defeat Reform UK, which has been surging in recent polls. This will make him even more appealing to Labour Party members who are worried about the rise of Reform.

Added to the rumblings around Westminster about Starmer’s future, the crisis over defense spending is another political problem he does not need. He could attend next month’s NATO summit not only without a credible plan to meet NATO’s defense targets, but also as a lame duck prime minister.

None of this helps NATO, Britain’s standing in the world or the security of allies and partners that have looked to the UK for leadership. The world benefits when Britain has a global presence and acts as a serious military power. For a country with one of the world’s largest economies, an independent nuclear deterrent and a permanent seat on the UN Security Council, chronic underinvestment in defense is not merely unbecoming. It is negligent.

While it may be too late for Starmer, whoever leads Britain next must act once and for all to fund defense properly. The days of underinvestment, creative accounting and hollow promises to meet NATO targets should be over. Britain does not need another review, slogan or aspirational target. It is actually quite simple: real defense capability requires real defense spending.

• Luke Coffey is a senior fellow at the Hudson Institute. X: @LukeDCoffey