The Ministry of Defence is facing a black hole in its budget of more than £2 billion, according to reports. A leaked internal spending estimate from the summer shows the department was forecast to spend £1.6 billion more on day-to-day costs and £1 billion more on capital investments in the 2025/26 financial year.
High inflation has pushed up the cost of weapons, while the national insurance rise for employers has hiked spending on wages for the Armed Forces. The Army, Navy and Air Force are being told to suggest areas that can be cut, The Telegraph reports.
Tory shadow defence secretary James Cartlidge said it “exposed the shocking truth behind Labour’s national security rhetoric”.
He added: “At a time of war in Europe, when we urgently need to strengthen our defences, they are instead telling the Armed Forces to make ‘savings’.
“The stark reality of defence under Labour is that they are putting our veterans back in the dock; wasting billions surrendering Diego Garcia, and now we’ve learned they’re starving the front line of cash.
“Those who defend our country deserve far better.”
It comes after Prime Minister Sir Keir Starmer announced plans to increase defence spending from 2.3% of GDP to 2.5% by 2027.
A spokesman for the MoD said: “This Government has boosted defence spending by £5 billion this year alone.
“We have also stepped up with the largest sustained increase in defence spending since the end of the Cold War, which is increasing to 2.6% of GDP from 2027, with an ambition of hitting 3% by the end of next Parliament.
“As the public would rightly expect, this Government is committed to securing value for money for taxpayers.
“As part of routine budget management, and to ensure we can respond to the changing nature of threats we face defence budgets are continually assessed and reprioritised.”