UK defence spending to rise to 2.5% of GDP by 2027 - as Starmer hits out at 'tyrant' Putin

25 February 2025, 12:10 | Updated: 25 February 2025, 13:57

Defence spending will increase to 2.5% of GDP by 2027 while the foreign aid budget will be cut, Sir Keir Starmer has announced ahead of a meeting with Donald Trump.

The prime minister, in an unexpected statement in parliament, announced spending would be increased to 2.5% of the UK's GDP by 2027 from the current 2.3%.

That will mean £13.4 billion more for defence each year after 2027, the PM said.

He also said he wants defence spending to increase to 3% of GDP in the next parliament, but that would rely on Labour winning the next election, set for 2029.

The number is much lower than the US president has demanded NATO members spend on defence, with Mr Trump saying they should all be spending 5% - an amount last seen during the Cold War.

Sir Keir also announced the government would cut back on foreign aid to fund the increase, reducing current spending from 0.5% of GDP to 0.3%.

Moments before the announcement, the Foreign Office said it was pausing some aid to Rwanda due to its role in the conflict in neighbouring Congo.

Foreign Secretary David Lammy just two weeks ago criticised Mr Trump's decision to freeze USAID, saying his party, in opposition, was hugely critical of how the Tory government closed down the Department for International Development as development remains a "very important soft power tool".

He said without it, he "would be very worried that China and others step into that gap".

Sir Keir said the reduction in foreign aid is "not a renouncement I'm happy to make", as charities said the cuts would mean more people in the poorest parts of the world would die.

He reiterated the government's commitment to NATO, which he described as the "bedrock of our security", and criticised Russian president Vladimir Putin, saying "tyrants only respond to strength".

Addressing his upcoming visit to the White House to meet Mr Trump, he said he wants the UK's relationship with the US to go from "strength to strength".

Conservative leader Kemi Badenoch welcomed the defence spending increase and said she had written to him over the weekend to suggest how he could redirect money from the overseas development budget.

"This is absolutely right," she told the Commons.

"And I look forward to him taking up my other suggestion of looking at what we can do on welfare."

She urged him to not increase taxes further or to borrow more to fund the rise, but to ensure the economy grows to support it.

Former Conservative defence secretary Ben Wallace said an extra 0.2% was "a staggering desertion of leadership".

"Tone deaf to dangers of the world and demands of the United States," he wrote on X.

"Such a weak commitment to our security and nation puts us all at risk."

Labour MP Sarah Champion, chair of the international development committee, said cutting the foreign aid budget is "deeply shortsighted and doesn't make anyone safer".

"The deep irony is that development money can prevent wars and is used to patch up the consequences of them, cutting this support is counterproductive and I urge the government to rethink," she wrote on X.

Charities condemned the cut, with ActionAid saying cutting the aid budget to fund the military "only adds insult to injury" and "flies in the face of UN charters", adding it was a "political choice with devastating consequences".

Christine Allen, CEO of CAFOD (Catholic Agency for Overseas Development), said the cut means "in some of the most vulnerable places on earth, more people will die and many more will lose their livelihoods".

She said the cut coming just after the US froze its aid programme "is another lifeline being pulled away from those in desperate need".

Labour promised in their manifesto to increase defence spending to 2.5% of GDP from the current 2.3%, however, ministers had previously refused to set out a timeline.

They had insisted a "path" to get to 2.5% would be set out after a defence spending review is published this spring.