NATO: Member State Spending

Lord Touhig Excerpts

Wednesday 1st February 2017 Lords Chamber

Asked by

[Lord Touhig]

To ask Her Majesty’s Government what progress they have made in discussions with other NATO countries about ensuring that all member states commit to spending two per cent of GDP on defence.

[Lord Touhig (Lab)]

My Lords, in the two weeks since he was sworn in as the 45th President of the United States, Donald Trump has been in the news every day. An anxious world has sometimes been stunned by his words, whether spoken or tweeted in the middle of the night. But I recall the words of another United States President, who said:

“To be prepared for war is one of the most effectual means of preserving peace”.


Those words were spoken by America’s first President, George Washington, in the very first State of the Union Address in 1790. I am not suggesting that a conflict is looming, but I echo Washington in saying that to keep the peace, we must be always be prepared for conflict. Do I believe that Britain is prepared for a sudden and unexpected conflict? Sadly, my answer is that I have serious doubts, and I am not alone in that, as I will show in my remarks.

As I stand at the Dispatch Box this evening, one word comes to mind about the Government’s commitment to the NATO 2% spend: disappointed. I am disappointed that our Government are playing fast and loose with defence spending. The Government continue to say that we have the fifth largest defence budget in the world and that we are one of five nations out of 28 NATO members committed to the 2% target. However, in the SDSR 2015, a new creative accounting was orchestrated by the Government so that they could reach that 2%. Professor Malcolm Chalmers, the deputy director at RUSI, told the Defence Select Committee that the Government had included £820 million on war pensions, £400 million on UN peacekeeping and £200 million on pensions paid to retired civil servants. The committee concluded that this “redefinition”, as it described it, of defence expenditure undermined the credibility of the Government’s assertion that the 2% represents a significant increase in defence spending. The Government responded by saying that all they were doing was capturing all spending contributing to our defence in the 2%. I am certainly interested to see whether the Minister will explain how paying pensions to civil servants contributes to Britain’s defence.

On these Benches we welcomed the Government’s commitment to spending 2% of GDP on defence. However, how can we persuade other member states to reach that 2% target if we are using creative accounting to reach that goal ourselves? Let us not forget that 2% is the minimum spend, not the maximum. It must concern all of us that the other 23 members of NATO are in no rush to increase their defence budgets when we see Russia spending $90 billion and China spending $150 billion on modernising their forces. Russia has placed a number of nuclear-capable missiles in Kaliningrad, on the border of Lithuania and Poland. That is but one measure of the challenge that we and NATO face.

I have been encouraged by the comments attributed to US Defence Secretary James Mattis, who has reassured our Defence Secretary of the United States’s “unshakable commitment to NATO”. I was more encouraged when, following her meeting with President Trump, our Prime Minister spoke of his unshakable commitment to NATO, although I would like to have heard the man himself say it. I remember candidate Trump’s comments about NATO in the election campaign. He said then:

“We have many NATO members that aren’t paying their bills … Many NATO nations are not making payments, are not making what they’re supposed to make”.


The new President has been busy signing executive orders almost every day since he walked into the White House. I hope we will not wake up one morning to see that he has tweeted in the middle of the night his intention to sign an executive order reducing American support for NATO.

Our NATO partners have to wake up to the fact that the Americans may well do things differently under this President and must take seriously his challenge about their GDP spend on defence. NATO is the bulwark of our defence and the United States plays the leading role. At the start of January, NATO began deploying 4,000 troops to the Baltic states. Britain, rightly, in support, committed 800 personnel to Estonia, four Typhoon aircraft in Romania and 150 personnel to Poland. A resurgent Russia is testing our resolve to deter and defend. Only last week, the Royal Navy was tasked with escorting the Russian aircraft carrier and its support group through the channel. We are also having to monitor increasing numbers of Russian submarines in the waters around the UK, and we do so without any marine patrol aircraft. In addition, we are seeing more and more Russian military aircraft flying dangerously close to our airspace. There is much more we have to do and my concern is that the Government, driven by a passion for an austerity policy which has failed miserably, are not sufficiently engaged to meet these challenges, and nor will they ever do so without increased defence spending, at least to a genuine minimum spend of 2% of GDP.

No one put it better than my noble friend Lord Robertson of Port Ellen, who said in a speech in 2015 that,

“the 2% only makes sense if it is spent on the right things—deployable troops, precision weapons, logistics and specialist people”.

He was quite right on that. When he opened the defence debate in this House on 12 January, he warned that we were sleepwalking into a potential calamity. Like my noble friend, I worry about our ability to meet the unforeseen.

I think that all the more having read the report from the Centre for Historical Analysis and Conflict Research. Based at Sandhurst, the centre examines past and current operations, carries out analyses and research, and acts as the Army’s think tank. The participants, some of the Army’s brightest minds and all serving officers and soldiers, are encouraged to speak out of turn to help inform our approach to requirement setting and procurement and to influence the perception of the Army. The report said that we may not be facing an immediate military threat but that there are several scenarios in which our allies may face a threat and we may need to engage. It asked the question: is the British Army ready if we become engaged in a war that we did not foresee? The soldier-scholars concluded:

“If one merely sees preparedness through net manpower and kinetic force capacity, the answer might be a simple ‘no’: the British Army is at its smallest and has faced years of budget cuts”.


I make no criticism of the Army, but I am critical of the way the Government have starved our Armed Forces of investment. We can have the latest equipment at our disposal but, if we do not have the manpower, how do the Government expect our Armed Forces to defend the liberties that we uphold?

I am proud of the fact that during the 13 years of the Labour Government, we spent an average of 2.5% of GDP on defence. This excluded the cost of conflicts in Iraq and Afghanistan, where expenditure was met from the Treasury reserve and not the defence budget.

In a recent Written Question, my noble friend Lord West of Spithead asked the Government whether there had been any consideration of reviewing the decision made by the previous Chancellor on funding for the new Dreadnought nuclear submarines. He and I agree that the funds should come from the contingency controlled by the Treasury and not from an overstretched defence budget. The Minister responded by saying that the funding of the new submarines—around £31 billion—would remain part of the defence budget. This is disappointing, and yet another example of the way in which this Government are stretching a limited defence budget and, at the same time, shamelessly massaging the figures to give the impression of meeting the 2% spend of GDP on defence.

Britain and the United States must be at one, doing everything possible to persuade our NATO partners to meet the 2% pledge they made in 2014. If Britain is to join the US in taking a moral lead, we can do so only if we spend a genuine 2% of GDP on defence.