Overview
- The Treasury confirmed on Friday that Healey will not set a headmark of 3% of GDP for defence by 2030 in the October 28 Budget and will instead leave any target date to the 2027 spending review.
- Ministers plan to prioritise filling a reported roughly £5 billion shortfall in the Defence Investment Plan, equivalent to about £1.2 billion a year, rather than funding a near-term uplift to hit 3% by 2030.
- Critics including former defence ministers and opposition figures have called the move hypocritical because Healey resigned as defence secretary in June over the exact 3% demand.
- Independent analysis cited across the coverage says reaching 3% by 2030 would cost about £10 billion a year in today’s terms and meeting NATO’s 3.5% commitment would cost substantially more, while current plans project roughly 2.7% by 2030.
- Markets reacted negatively after the announcement, with listed defence firms losing value, and the government says it will outline a pathway to meet NATO commitments at next year’s spending review as fiscal limits and procurement reform remain central constraints.