We need to talk about defence – Inside track

President Trump is warm towards Russia and hostile to Ukraine and Europe. We are in a new and dangerous world and the prime minister is increasing UK defence spending to 2.5 per cent of GDP by 2027. “That”, he says, “means spending £13.4 billion more on defence every year.” He also promises to “set a clear ambition for defence spending to rise to three per cent of GDP in the next parliament”.

Many are asking whether this is enough. Retired generals and admirals queue up to call for a bigger, faster increase, even if it means cuts to education, welfare and the NHS. Kemi Badenoch wants to increase spending to three per cent “sooner than the end of the decade”. Rachel Reeves says that, in addition to the increase in spending announced by the prime minister, the remit of the National Wealth Fund will be changed so that it can be spent on defence.

There can be no doubt that all is “changed, changed utterly”. Russia is dangerous.  President Trump’s bullying of Ukraine is shameful. We all know the dangers of appeasement. Nevertheless, we should take a breath and consider the impact a huge increase in defence spending will have on other priorities, how the money will be spent and what it will achieve.

What does it mean for other priorities?
Aneurin Bevan’s Delphic statement that “the language of priorities is the religion of Socialism” is well known. Less well remembered are the words that came next, that the Attlee government had decided “that the first claims upon the national product shall be… those of the women, the children and the old people”.

This government was elected to improve living standards and public services, strengthen the economy and improve the environment. What effect will a big increase in defence spending have on those priorities?

A Royal United Services Institute paper by Malcolm Chalmers sets out some of the implications of raising defence spending to three per cent of GDP. “There has”, he warns, “been very little attempt to ready the British public for the sacrifices that will be needed.” He calculates that such an increase would require a 5p in the pound increase in income tax or an increase in the standard VAT rate from 20 per cent to 25 per cent. “Alternatively, it would require a significant cut in the GDP percentage spent on other public services and/or other international spending commitments.”

We have already seen swingeing cuts to the UK’s development budget, something few expected from a Labour government. Anneliese Dodd’s resignation letter set out some of the consequences of the cut, both for people in need and the UK’s soft power. Others have pointed out that cutting the aid budget will make the UK less safe, including through cutting programmes to address climate change.

The immediate hike in defence spending was a play for US support on the eve of the prime minister’s visit to Washington. It did the trick. But we now need a serious debate on how to fund further increases. In Dodds’ words, “it will be impossible to raise the substantial sums needed just through tactical cuts to public spending”. The government has lacked a coherent economic strategy for some time. It needs one now more than ever.

In 1951, Labour split over the rising cost of defence spending in response to the Korean War. Later that year it lost the election. Churchill’s priorities were “houses and meat and not being scuppered”, to which he added a fourth priority, “not being broke”. After a couple of years, his government was able to cut defence spending and the Conservatives remained in power for 18 years.

Keir Starmer’s mantra, “country first, party second”, is admirable and he is right that his first duty as prime minister is “to keep our country safe”. But “not being scuppered” is also important for any government and that means delivering for its voters.

Where will the money go?
The defence review, led by George Robertson, will inform how the increased defence budget is spent. It should dig deep.

Huge waste and cost overruns have characterised defence spending for many years. We have, for instance, spectacularly expensive aircraft carriers that appear to serve no useful purpose.

The cost of the UK’s nuclear weapons has risen to £6.5 billion a year, prompting Richard Norton-Taylor, The Guardian’s former security editor, to ask whether they now undermine the UK’s security: “Trident’s growing cost threatens to overwhelm the entire British defence budget, diverting spending from cheaper conventional weapons systems.”

Nor should we kid ourselves about the state of the army, which has lost its last two major wars, in Iraq and Afghanistan, in the sort of humiliating circumstances that once brought governments down.

The government is committed to spending more on defence. It should make sure the money is, for once, well spent.

We must brace for a future of uncertainty, beyond just defence
Keir Starmer insists that the US will continue to lead NATO. All his efforts are aimed at ensuring its involvement in European security. That is sensible: it is hard to see how NATO could operate without US leadership. But we must also be open to the possibility that, in the words of Friedrich Merz, a longtime Atlanticist poised to be the next German chancellor, the Trump administration “does not care much about the fate of Europe” and Europe must aim to “achieve independence from the USA”. Rearming for a world in which Europe can no longer rely on US support will be a very different matter from contributing more to NATO under US leadership.

Green growth is the way to greater resilience and funding
I have not dwelt here on the implications of greatly increased defence spending for environmental policies but they are potentially huge. Money is finite and so is the attention of governments. Already, cuts to overseas aid are set to hit climate programmes. Economic growth is more important than ever if more of the nation’s wealth is to be spent on defence: with the green economy growing three times faster than the rest of the UK economy, is it really sensible to spend the  National Wealth Fund (NWF) on weapons? Diluting the NWF’s purpose certainly makes it less likely that it will be used, as Green Alliance has proposed, to boost private investment in nature restoration?

Defence is the priority of the day, but climate change has not gone away just because President Trump has banned the words. The need to build resilience and free ourselves from dependence on imported fossil fuels is more vital than ever. Alongside investment in defence, we need a much clearer clean growth strategy. The government should make clear that it will not aim to fund increased defence spending through a new round of austerity. It should look again at the fiscal rules, raise taxes if necessary and look again at the flawed tax system.

In these new times, we need a much more considered debate than we have had so far about how much to increase defence spending, to what end, how to fund it and how to do so in ways that do not undermine other priorities, not least green growth and the long term resilience that can only come from more concerted action on climate and nature.

Image credit to Number 10 on Flickr.