LONDON: Prime Minister Keir Starmer said on Tuesday he would increase annual defence spending to 2.5 per cent of GDP by 2027 and target a 3pc level last seen just after the Cold War, a signal to US President Donald Trump that Britain can boost Europe’s security.

On the eve of his departure to meet Trump in Washington, Starmer told parliament he was bringing the increase in defence spending forward to offer Europe more support as the US spearheads peace talks with Russia over its war in Ukraine.

With public spending already stretched in Britain, Starmer said the increase from its current 2.3pc would be fully paid for by a 40pc cut to international aid, an announcement he said he was not happy to make but one which was necessary to offer Ukraine and Europe support in a “new era”.

Since Trump seemingly abandoned the United States’ more Ukraine-friendly approach to Russia’s war, blindsiding much of Europe, Starmer and other European leaders have stepped up diplomatic efforts to show a united front to support Kyiv.

“Starting today, I can announce this government will begin the biggest sustained increase in defence spending since the end of the Cold War,” Starmer said, adding that combined with spending on intelligence services it would reach 2.6pc from 2027.

“We must go further still. I have long argued that ... all European allies must step up and do more for our own defence,” he said. He added that Britain would set a target for spending 3pc of gross domestic product in the next parliament, which will convene after a national election due in 2029.

US Defence Secretary Pete Hegseth welcomed the spending rise after speaking to British defence minister John Healey. “A strong step from an enduring partner,” Hegseth said on X. The increase would see Britain spending 13.4 billion pounds ($17 billion) a year more on defence from 2027, Starmer said.

The Institute for Fiscal Studies, a non-partisan think tank, said this seemed “misleadingly large” as an increase of 0.2 percentage points of GDP amounted to only around 6 billion pounds. Britain’s defence ministry said it spent 53.9 billion pounds in the 2023/24 financial year.

To meet the increase in spending, the international aid budget will be cut from 0.5pc of gross national income to 0.3pc in 2027, meaning borrowing levels would not change, Starmer said. Britain last cut its aid budget in November 2020, during an economic crisis resulting from Covid-19, reducing the level to 0.5pc of GDP from 0.7pc, a move criticised by some development groups for diminishing the nation’s global influence.

“This is a short-sighted and appalling move,” said Romilly Greenhill, chief executive officer of Bond, a network for organisations working in international development and humanitarian assistance.

Pre-Trump visit gambit

Starmer’s statement was a clear opening gambit before meeting Trump in Washington, signalling Britain will try to lead other European countries in offering more support to the US-led military Nato alliance — a demand Trump has repeatedly made, suggesting nations should spend 5pc of GDP.

Nato Secretary General Mark Rutte has also called on member states to step up defence spending beyond their common goal of 2pc of national output set a decade ago. According to Nato, Britain was the third-largest spender in cash terms in 2024, behind the United States and Germany.

Germany’s likely next chancellor, Friedrich Merz, has pledged to significantly raise defence spending but will need to navigate the possibility of far-right and left parties blocking his plans.

Starmer heads to Washington, hoping to reassure Trump that Europe will provide support and security guarantees to Kyiv if peace talks with Russia are successful.

The British leader has said he is open to British troops providing security guarantees to Ukraine alongside other European nations.

Published in Dawn, February 26th, 2025