UK Defense Spending & Capability - UK government will begin the biggest sustained increase in defense spending since the end of the Cold War [1] - The British army's combat power is much less than it has been [1] - The army is at its smallest size since the Napoleonic era, losing more people than it's recruiting [2] - Security experts believe Britain is incapable of defending itself against a ballistic missile attack [4] - There is a significant gap between Britain's rhetoric/reputation and its actual military capabilities [5] Financial Constraints & Political Challenges - Voters want more security and greater defense spending, but don't necessarily want to pay for it [4] - Since 1955, there's been a correlation between the UK's ballooning health and welfare bill and cuts to defense spending [10] - In the 50s, defense spending was at 7-1/2% of GDP and health spending at around 3% of GDP; those percentages are almost flipped now [11] - Raising defense spending to 5% of GDP will add 350 billion pounds to the level of government debt by 2032 [19] - By 2030, upping the NATO target to 5% would mean an extra 87 billion pounds worth of spending on defense [18] Strategic Considerations & Industry Impact - The current target strength is 72,000 personnel, but available strength is around 55,000 [6][7] - Defense spending will now rise to 2-3/5% of GDP by April 2027, including the contribution of intelligence agencies [17] - Focus expenditure on investments in this country, not importing from the US, to provide a domestic boost to the economy [23] - Military spending focused on research and development could lift UK productivity [23] - Industry needs commitments from the UK government or allied governments to know exactly what they need to make [26]
Can the UK Afford to Defend Itself?
Bloomberg Originalsยท2025-06-20 08:00