Rachel Reeves says she will resist calls to raise taxes to increase defence spending

Chancellor Rachel Reeves has indicated she will resist calls to raise taxes further to fund increased defence spending, despite growing concerns over global security threats from Russia, Iran, and China. Reeves emphasized that she has already significantly increased the tax burden and would prefer not to do so again. The UK’s armed forces face a projected financial shortfall of around £28 billion over the next four years, amid pressure from NATO allies and the US to boost defence budgets. Reeves highlighted that her recent spending review delivered the largest uplift in defence funding since the Cold War’s end, including reallocating funds from the overseas development budget. The UK’s slower pace in increasing defence expenditure has drawn criticism from senior military figures. Former NATO chief Lord Robertson accused the government of “corrosive complacency” and criticized Treasury officials for what he described as “vandalism” of military budgets. Similarly, former Chief of Defence Staff Lord Stirrup warned that the UK is “badly exposed” and requires a decade to rebuild its military capabilities. NATO has revised down its forecast for UK defence spending this year from 2.4 percent to 2.31 percent of GDP, reflecting ongoing concerns about the country’s preparedness. Reeves defended the government’s approach at the International Monetary Fund summit in Washington DC, stressing the importance of prioritizing national security while managing fiscal responsibility. She noted that the government is carefully reviewing a 10-year defence investment plan to ensure funds are effectively allocated to meet the country’s strategic needs. Reeves also pointed to rising government borrowing costs, exacerbated by conflicts such as the situation in Iran, as a factor limiting the scope for further tax increases or debt accumulation. The debate highlights the tension between fiscal prudence and the urgent need to address defence shortfalls amid a challenging international security environment.