UK defence spending has entered its largest expansion in a generation — driven by Russia's war in Ukraine, Trump's pressure on NATO allies, and a fundamental reassessment of Western security. The budget hits £62 billion in 2025-26, with targets to reach 3.5% of GDP by 2035 — requiring an additional £40 billion per year. But Britain's procurement record is one of the worst in the alliance, and the political crisis that culminated in the Defence Secretary's resignation in June 2026 casts doubt on whether the money will be spent effectively.
How Much Does the UK Spend — and Where Is It Going?
In the 2025/26 financial year, the UK spent £62.0 billion on defence. Under plans set out in the Defence Investment Plan, spending is expected to reach £79.1 billion in 2029/30. On the NATO measure, the latest NATO estimates show that the UK spent 2.3% of GDP on defence in 2025 and is expected to spend 2.6% in 2026.
Defence spending as a share of GDP fell steadily from over 5% in the 1980s to under 2% by 2014-2021 — the so-called "peace dividend" from the end of the Cold War. Russia's invasion of Ukraine in 2022 ended that era. In February 2025, the government committed to increase defence spending to 2.5% of GDP by 2027, and to 3% of GDP in the next Parliament. It has since further committed to increasing spending to 3.5% of GDP by 2035, in line with a new NATO target.
NATO Comparison — How the UK Compares to Allies
The UK is the second-largest defence spender in NATO in absolute terms (after the US), and above the 2% GDP baseline that all 32 NATO members met for the first time in 2025. But relative to some Eastern European allies who face more immediate threats, UK spending looks modest.
| Country | Defence Spend % GDP 2025 | vs 2% Target | Notes |
|---|---|---|---|
| 🇵🇱 Poland | 4.7% | +2.7pp | Largest land army expansion in Europe |
| 🇪🇪 Estonia | 5.1% | +3.1pp | Shares border with Russia |
| 🇱🇻 Latvia | 4.9% | +2.9pp | Border state — defence existential issue |
| 🇬🇷 Greece | 3.7% | +1.7pp | Long-standing high spending vs Turkey |
| 🇬🇧 United Kingdom | 2.3% | +0.3pp | 2nd largest NATO spender by £ value |
| 🇺🇸 United States | 3.4% | +1.4pp | Largest NATO spender by large margin |
| 🇫🇷 France | 2.1% | +0.1pp | Independent nuclear deterrent |
| 🇩🇪 Germany | 2.1% | +0.1pp | Major expansion after decades of low spending |
| 🇮🇹 Italy | 1.5% | −0.5pp | Below 2% target despite 2025 commitment |
| 🇪🇸 Spain | 1.3% | −0.7pp | Consistently below NATO baseline |
Procurement — Britain's Chronic Failure to Spend Money Effectively
Increasing the defence budget is one thing. Spending it competently is another — and the UK's defence procurement record over the past 30 years is among the worst in the alliance. The pattern is consistent: contracts awarded on optimistic timelines and budgets, followed by years of delays, cost overruns, and capability gaps.
The Ajax Armoured Vehicle — The Facts on Record
The following information is drawn from official Parliamentary sources — Hansard debates, House of Commons Defence Committee reports, and National Audit Office publications — which carry qualified privilege when accurately reported. All facts stated below are on the public record from official government and Parliamentary sources.
According to the House of Commons Hansard record (25 June 2025) and House of Commons Defence Committee reports: the Ajax armoured fighting vehicle programme was contracted in 2011 for delivery in 2017, then deferred to 2020-21. Trials were halted due to safety concerns — soldiers reported hearing loss, vibration injuries and nausea; this is documented in NAO report HC 125 (2022) and Parliamentary debate. The contract was renegotiated for 2024 delivery. Full operating capability has been forecast for 2027, though the programme's future was noted as uncertain in Parliamentary debate.
The Ajax programme was originally contracted for 589 vehicles. According to House of Commons Defence Committee reports and Parliamentary debate, fewer than 26 vehicles had entered limited service by early 2026 against a target of 589. The vehicle was intended to replace the army's ageing Scimitar reconnaissance vehicle. Programme costs have been the subject of multiple Parliamentary questions; the Ministry of Defence has not published a definitive total cost figure, but estimates cited in the House of Commons have exceeded £5 billion.
The Morpheus Battlefield Radio System
According to a statement in the House of Commons on 25 June 2025, the Morpheus battlefield radio system contract has cost £828 million to date. The programme has experienced significant delays relative to its original schedule — a matter raised repeatedly in Parliament and by the National Audit Office in the context of UK defence procurement performance.
The Pattern of Failure
Academic analysis identifies consistent causes across UK defence procurement failures:
• Immature design given go-ahead too early — contracts signed before designs are sufficiently developed, leading to expensive changes during production
• Unrealistic cost estimates driven by political optimism — the same bias that affects HS2 and other major projects
• Commercial structures that misalign contractor incentives — fixed-price contracts for novel equipment give contractors incentive to underbid, then recover costs through contract changes
• Insufficient competition — many contracts go to a small number of large defence contractors with limited competitive pressure
• Revolving door between MoD and contractors — senior officials moving between the Ministry and defence companies raises governance questions
The June 2026 Political Crisis
On 11 June 2026, Defence Secretary John Healey resigned — posting a letter to Prime Minister Keir Starmer that amounted to a public indictment of the Treasury's approach to defence funding. Healey accused the PM and Chancellor of failing to provide the funding needed to implement the Strategic Defence Review, leaving the entire Defence Investment Plan in a state of uncertainty.
The Defence Secretary's resignation came as the most politically turbulent week in British defence policy in decades. The SDR's entire implementation architecture depends on a funding settlement that, as of the time of resignation, had not been agreed.
The resignation revealed a fundamental tension at the heart of UK defence policy: commitments to NATO allies to reach 2.5% by 2027 and 3.5% by 2035 — made publicly and repeatedly — sit in conflict with Treasury fiscal rules that limit borrowing. Bridging this gap requires either significant tax rises, cuts to other departments (NHS, benefits, education), or a formal suspension of fiscal rules for defence spending — none of which the government had committed to at the time of writing.
What the Money Actually Buys
The Strategic Defence Review set out a vision for rebuilding UK capabilities across all domains — land, sea, air, cyber and space. The key commitments include:
Naval expansion: A "New Hybrid Navy" combining new Type 26 and Type 31 frigates, autonomous vessels, and deeper use of the two Queen Elizabeth-class aircraft carriers. The carriers are operational but have faced persistent challenges with aircraft availability and crew numbers.
Land forces: The British Army is currently below its target size set in the 2021 Defence Command Paper. The numbers of personnel in all three branches of the armed forces are currently below target sizes, and the Strategic Defence Review referred to a longstanding recruitment and retention crisis in the MoD. Pay, housing quality and operational tempo are cited as primary retention problems.
Air power: The F-35B fleet is expanding but at slower rates than planned. The Tempest next-generation fighter (now Global Combat Air Programme — GCAP with Japan and Italy) has been confirmed but is a 2030s programme.
Ukraine support: At the 2024 NATO summit, the Prime Minister pledged £3 billion a year in military support for Ukraine until 2030/31 or for as long as needed. This is additional to the core defence budget and represents a significant ongoing commitment.
Cyber and space: Growing investment in GCHQ, National Cyber Security Centre, and space surveillance capabilities — areas where the UK has genuine world-class capabilities that require sustained investment to maintain.