Ministry of Defence: Budget Shortfall

Lord Stirrup Excerpts

Thursday 15th January 2026 Lords Chamber

[Lord Coaker (Lab)]

The defence investment plan will deal with choices according to the budget that it has set for it. Even if you increase the budget, you still have to make choices about what you spend that money on. The Chief of the Defence Staff and the other chiefs are involved in this, discussing what capabilities we need, with the budget that we have, to ensure that we have the war-fighting readiness we need. Those choices are taking place.

Considerable sums of money are being spent at present—billions of pounds. I keep repeating this: under current plans, the total budget in 2024-25 was £60.2 billion; in 2008-29, on current plans, it will be £73.5 billion. Billions of pounds of additional money is being spent. We are seeking to ensure that we spend it properly and appropriately to fight the wars of the future.

[Lord Stirrup (CB)]

My Lords, the Minister is quite right, but he knows as well as the rest of us that those are meaningless figures: what really matters is how much you can buy for the money you are spending. Given the accounting changes that have taken place over the intervening years, we are currently spending a lower percentage of GDP on defence than we were in 2010, when we were not facing the very serious threats to European security that we see today. How do the Government explain this?

[Lord Coaker (Lab)]

The Government explain it by using the figures I have just outlined. There is billions of pounds of additional money. You cannot alter the fact that it is going from the figure I just gave to the noble Lord, Lord Young, to the figure it will be. The noble and gallant Lord knows far better than me that choices have to be made within that budget about what capabilities you will spend it upon. One of the choices that confronts us is what lessons we learn from Ukraine, and what capabilities we need to ensure that we fight the war of the future and not the war of the past. That is part of the discussion that is going on at present.