Home›Global Markets›Europe›UK Treasury has not analyzed how to reach Nato 3.5% de…

UK Treasury has not analyzed how to reach Nato 3.5% defence target

MPs said the step up to the Nato target would require about 30 to 40 billion pounds more spending, roughly 3p to 4p on all income tax.

Reported · Written up by our desk · Europe

The UK Treasury has not carried out analysis of the trade-offs needed to reach a Nato pledge to spend 3.5% of GDP on defence, according to testimony reported by the Guardian Economics.

During a joint session of the Treasury and defence committees, Lucy Rigby said any funding changes would be a matter for the next prime minister. She also noted that Keir Starmer has promised the UK will hit the 3.5% target by 2035, while Whitehall has not yet set out a spending path to get there.

MPs pressed Rigby on the scale of the shift, with one committee member saying it would mean 30 to 40 billion pounds in additional defence spending, equivalent to 3p to 4p on all rates of income tax. Rigby said the issue would require debate about “public consent” and that the interim goal is 3% defence spending in the next parliament, though the path has not been defined.

The Guardian Economics reports the lack of a future spending route was cited as one reason for John Healey’s resignation as defence secretary. Rigby said an additional 4.7 billion pounds would also need to be found by the time of the autumn budget, and that the broader question would be left for the next spending review, due in mid-2027.

More like this

Sources