Next UK chancellor must find nearly £5bn for defence funding gap, document says
6 reported
Government figures reveal that the next UK chancellor will need to find almost £5bn over four years to fund the remainder of the Defence Investment Plan (Dip), according to a document jointly produced by the Ministry of Defence and the Treasury. The document explains how the £15bn Dip is being funded, with all departments asked to cut capital spending by 1%, generating £4bn over four years. Two departments face larger cuts: transport will cut £800m over four years, and energy will cut £2bn over four years. The transport cuts include potential cancellation of the A38 Derby Junctions and A46 Newark bypass schemes, while energy savings will come from reshaping the Department for Energy Security and Net Zero’s capital budget. Chancellor Rachel Reeves stated in a written statement that the remaining £4.7bn will be found at the next budget “in a fair and balanced way.” The article notes that Reeves is expected to leave her post when Andy Burnham becomes prime minister.
What’s reported
The next chancellor must find almost £5bn over four years (including almost £2bn for 2026-27) to fund the rest of the Defence Investment Plan.
All government departments have been asked to cut capital spending by 1%, generating £4bn over four years.
Transport faces further cuts of £800m over four years, including potential cancellation of the A38 Derby Junctions and A46 Newark bypass schemes.
Energy faces further cuts of £2bn over four years, with the Department for Energy Security and Net Zero finding additional savings.
Chancellor Rachel Reeves said the remaining £4.7bn will be confirmed at Budget 2026 “in a fair and balanced way.”
The article states that Reeves is expected to leave her post when Andy Burnham becomes prime minister.
Key figures
Keir Starmer (prime minister, gave speech on cuts)
Rachel Reeves (chancellor, published written statement)
Andy Burnham (expected to become prime minister)
Zack Polanski (Green party leader, criticized refugee tax plan)
David Lammy (deputy prime minister and justice secretary)
Capt Jacob Wulfson (US fighter pilot, subject of case raised by Lammy)
Jess Brown-Fuller (Liberal Democrat justice spokesperson)
Max Warner (senior research economist at Institute for Fiscal Studies)
Lord Hermer (attorney general)
Sources: The Guardian
