To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of recent trends in borrowing costs on the Government's capacity to increase defence spending to 2.5% of GDP expenditure.
Answered on
14 January 2025
This government is fully committed to economic stability and sound public finances. That is why the Chancellor has made clear that meeting the fiscal rules is non-negotiable.
Economic stability is one of the foundations that underpins the Prime Minister's Plan for Change, and the government has restored it with tough decisions, strict spending rules and robust institutions.
The Spending Review will rewire government spending, to deliver the Plan for Change priorities, focusing on driving growth and reforming public services, whilst living within the spending envelope that has been set out.
The first duty of government is to keep the country safe and protect our citizens. Under this government the Ministry of Defence’s budget is increasing by £2.9 billion from 2024-25 to 2025-26. It means the Defence budget will grow in line with the economy in 2025-26, ensuring the UK comfortably exceeds the NATO target of 2% of GDP.
As the Chancellor set out at Budget, we will set a path to spending 2.5% of GDP on defence at a future fiscal event.