Keir Starmer is set to face intense questioning in Parliament regarding a newly announced defense investment plan, which critics are labeling an 'unexploded bomb' due to its significant funding uncertainties. The plan outlines a £15 billion boost over four years, but a substantial portion, nearly £5 billion, has an undefined funding source that will be determined at a future budget, potentially under a new Prime Minister.
The Defence Investment Plan (DIP) has drawn criticism for being "too little too late," with a significant portion of the funding expected to come from cuts to other government departments. The Institute for Fiscal Studies (IFS) think tank has warned that tax increases or reductions in public services are likely consequences of the current funding model.
While the Prime Minister and Chancellor Rachel Reeves announced the plan at a drone factory, highlighting it as a crucial step for national security, details about the funding gap have emerged. Mr. Burnham was reportedly briefed on the DIP but appears to have become aware of the funding shortfall only recently. The Ministry of Defence is also tasked with finding £10.7 billion in efficiency savings to contribute to the package. Crucially, there is no set date for military spending to reach 3% of GDP, a target that is not projected to be met until the 2030s, with an ambition of 3.5% by 2035.
Armed forces minister Luke Pollard defended the funding gap, describing the £4.7 billion as "not unusual" and stating that such allocations are often finalized at a later budget. He indicated that the necessary funds could come from the Treasury's financial headroom or other spending decisions. Pollard also acknowledged that some planned improvements to armed forces family housing have been deferred to prioritize immediate military readiness, a decision he called a "tough decision."
Allies of Mr. Burnham had reportedly sought to delay the release of the DIP until after Sir Keir's expected handover of leadership on July 20. Sir Keir stated the proposals were the "right choice for the country" but conceded that some infrastructure projects, such as roads and energy initiatives, might be canceled as a result. The announcement has also led to speculation about upcoming challenges, including a potential confrontation with Donald Trump at a NATO summit, where increased defense spending is expected to be a key topic.
Former defense secretary John Healey, who resigned over the initial funding offers, argued that the £15 billion package is insufficient to address rising threats. Tan Dhesi, chair of Labour's Defence Committee, expressed disappointment over the lack of a clear timeline for increasing defense spending to GDP targets. The plan's reliance on departmental cuts and unspecified future funding has fueled concerns about its long-term viability and potential impact on other public services.