In April 2024, when Grant Shapps (who was then the defence secretary) introduced that the UK was going to spend an additional £75bn on defence, the shadow defence secretary John Healey identified that this determine was arrived at by some decidedly dodgy maths. The Sunak authorities had cooked up the quantity by pretending that defence spending would in any other case not have modified in any respect between 2024 and 2030, and added up the distinction between that (unimaginable) situation and its plan to spend 2.5 per cent of GDP on defence by the top of the last decade. It was a plan to spend extra, however the determine was grossly overstated. Healey rightly advised the Commons the £75bn was a “pretend determine”.
Healey – now the Defence Secretary – was just a little quieter on the maths of Keir Starmer’s announcement from Downing Road yesterday that defence spending would profit from “a rise of £13.4bn yr on yr in comparison with the place we’re at the moment”. This isn’t as grotesque a maths crime because the earlier authorities’s declare, however it makes use of the identical trick. Technically, we shall be spending £13.4bn extra on defence than we’re at the moment, however the choice the federal government has made is to spend an additional 0.2 per cent of GDP, which at that time will in all probability imply an additional £6bn of spending per yr.
The rationale that is vital is that, in contrast to the earlier authorities (which pretended it was going to sack a load of civil servants, and by no means did) Starmer additionally defined how the federal government goes to pay for the rise to 2.5 per cent – by reducing about £6bn from abroad help. As Andrew Marr writes this week, it is a “brutal selection” that underscores simply how ruthless Starmer is now ready to be.
What the Prime Minister didn’t clarify was how the nation will afford his additional ambition to take defence spending to three per cent of GDP within the subsequent parliament. Ben Zaranko, of the Institute for Fiscal Research, advised me this could contain an extra £10bn dedication per yr. The one option to pay for that is via taxes or cuts: “If it’s a everlasting, recurring improve in defence spending, you may’t sustainably borrow for that. You need to pay for that via larger taxes or decrease spending.” We will in all probability stay up for the stealth tax of frozen thresholds being prolonged past 2028, or a further penny on revenue tax, to make up the distinction.
The opposite essential level Healey made final yr was that in 14 years of Conservative authorities, “no less than £15bn” had been wasted on “mismanaging defence procurement”. Usually, a authorities plans to do one thing after which tries to determine how a lot it’ll value; the defence spending dedication is a plan to spend some huge cash, with particulars of what it’ll obtain to comply with. A key goal is to not be invaded, however past that the main points start to waver.
Defence spending is an space that’s already one thing of a procurement catastrophe. There are causes for this. You’re not allowed to inform the general public an excessive amount of about what you’re spending the cash on, or who’s spending the cash, as a result of then you definitely’re telling the enemy what number of bombs you’ve, and also you in all probability shouldn’t do this. There are additionally only a few corporations you may go to if you wish to purchase, say, an plane provider, and the listing is made shorter nonetheless by the truth that you’ll in all probability be advised to purchase it from a British producer.
A few of these corporations are additionally slightly efficient and chronic at lobbying, and the revolving door between authorities and the defence business spins so persistently it might be used to energy a small city.
It will, subsequently, be an excellent thought if the plan to extend Britain’s defence spending was accompanied by a plan to make that spending extra clear and accountable. Duncan Hames, director of coverage at Transparency Worldwide, says there are “components of defence procurement which you’ll be able to nonetheless do in an open and aggressive method, even when sure details about the capabilities of what you’re procuring don’t find yourself within the public area”. Hames warns that with out higher safeguards about the best way defence spending selections are made, we’d find yourself with a repeat of the spending rush that occurred throughout the pandemic: amid the “obligatory haste” of emergency spending, “an enormous quantity of waste, some opportunism by people who wished to win contracts, and large questions on privileged entry”. If we enable that to occur once more, Britain’s defence will grow to be even tougher to pay for.
This piece first appeared within the Morning Name e-newsletter; obtain it each morning by subscribing on Substack right here
[See also: America and Russia’s plot to end the Ukraine war on their terms has left Europe scrambling to secure its future]