Defence budget was falsely inflated by MOD, claim MPS

BRITAIN’S defence spending has fallen below 2 per cent of GDP after the Ministry of Defence used pension contributions to mask the true figure, an MPS’ report has said.

A special report by the defence select committee, using data covering the past four years, claims that the real level of spending has been below the sum established by Nato members.

Despite the Government saying it spends 2.1 per cent of GDP on defence, the figures suggest Britain first dipped below the agreed total in 2014-15 and has not recovered since.

The MPS claim the MOD only met the 2 per cent benchmark by adjusting what was counted as “defence expenditure”, such as £1 billion in war pensions and MOD civilian pensions, in 2016.

The new accounting method also allowed for British defence expenditure to be officially increased if troops were deployed overseas in greater numbers than anticipated. The Treasury has allocated about £500million annually for such an eventuality.

The Government accepts it included new sources of spending in the figures, but that this was in line with Nato guidelines and was not a Whitehall decision. The figures in the special report had not included these new provisions in order to compare current spending with levels before the policy change.

Speaking in a debate on defence spending yesterday, Julian Lewis, committee chairman, asked if spending 1.8 per cent was credible against an “adversarial Russia” and the revival of a “threat from Islamist terrorists”.

He said he had written to both Conservative Party leadership contenders seeking assurances that the MOD would be adequately supported if they become prime minister.

Both Boris Johnson and Jeremy Hunt wrote back and agreed to raise defence spending above Nato’s target.