Defence Secretary Dan Jarvis has secured an extra £1.5bn for the UK's long-delayed defence investment plan, with the bulk of that funding directed towards drones to deter Russia and Iran. The announcement comes after rows over an £18bn funding gap led to the resignation of his predecessor, John Healey, and raised questions about Britain's commitments to Nato.
Funding Gap Reduced
Two sources confirmed that the deficit has been reduced by £15bn after Jarvis successfully persuaded Chancellor Rachel Reeves to give the Ministry of Defence slightly more than the £13.5bn promised to Healey, who quit in protest. The extra cash has allowed Jarvis to increase an already promised £4bn spend on drones to £5bn over the next four years, as part of a deal that Prime Minister Keir Starmer was keen to finalise before leaving office.
Some of the additional funding for defence was found by asking other government departments to take at least a 1% cut from their capital budgets, in one of the most acrimonious Whitehall rows in recent memory. Allies of Jarvis said he wanted to "look people in the eye" when the plan is published, while those close to Reeves noted she found him easier to deal with than Healey, who had become frustrated in his final weeks.
Direct Negotiations
A person close to the chancellor added that unlike Healey, Jarvis negotiated directly with Reeves rather than going through the prime minister, which facilitated an agreement. A week ago, Jarvis had secured an extra £1bn and was seeking more in a final round of negotiations. Healey has taken a close interest in developments since his departure and is expected to speak in the Commons on Tuesday as the 80-page document is presented to MPs.
The plan covers dozens of defence projects from frigates to nuclear submarines. Royal Marine commandos will receive additional uncrewed speedboats made by Kraken Technology from Fareham, Hampshire, as part of extra commitments secured by Jarvis from the Treasury. These will be deployed in a peacekeeping mission in the Strait of Hormuz to help detect hostile incoming drones, military sources said, should a durable peace agreement be reached between the US and Iran.
Economic and Strategic Justification
Prime Minister Starmer will unveil the plan at a defence firm on Tuesday morning, justifying it as creating jobs and strengthening national security. The outgoing prime minister said it would "help drive growth across the UK, giving our industrial base the confidence, certainty and support it needs." A similar argument was made by Andy Burnham, the likely next prime minister, in a speech in Manchester on Monday. He said future UK public procurement would be based on "helping our own British-based suppliers become more stable and competitive," which will apply fully to the defence investment plan.
Allies of the former Greater Manchester mayor indicated they want the row over the plan resolved before he takes office but added he would reserve the right to reopen it if needed, amid warnings from former service chiefs that the UK is not committing enough. Over the weekend, Tony Radakin, the previous head of the armed forces, warned there was a risk the UK would "fall short" of spending enough to deter future Russian aggression and called on Burnham to introduce a "Moscow test" to assess how decisions on UK defence spending would be perceived by the Kremlin.
Nato Commitments
Starmer had committed the UK to spend 3.5% of GDP on defence by 2035, an increase of nearly £30bn from the projected 2.6% spend in 2027. Healey had wanted Starmer to go to 3% by 2030 en route to the final target, but the prime minister was willing only to offer a modest increase to 2.68%. Nato Secretary General Mark Rutte said on Monday he was confident the UK would eventually meet its spending commitments, though he acknowledged he did not expect the UK to hit the 3.5% target "in one big step" in the plan.
Visiting the UK, where he met Starmer ahead of next week's Nato summit, Rutte said he believed Burnham would see broader value in boosting UK defence spending by nearly £30bn a year and that "judging from history," Labour prime ministers had shown "a consistent commitment to Nato." Referring to Burnham, Rutte also deployed an economic argument: "I can imagine that the new prime minister will be extremely interested in the issue of economic growth and more jobs. Defence spending does two things at the same time. One, your first priority as a government: keep the country safe, obviously number one. But also second [is the] impact of your defence investments. Next to keeping the country safe and strong, is [the fact] it will create jobs."
The Royal Navy will also build six "hybrid" air defence frigates, common combat vessels capable of coordinating with air, sea and underwater drones. They are intended to replace the navy's existing Type 45 destroyers in the mid-2030s and become the primary source of UK maritime air defence.
