New UK Chancellor Healey delays setting defence spending target date

The UK Treasury has confirmed that new Chancellor John Healey will not announce a timeline for reaching the target of spending 3% of GDP on defence in his first budget on 28 October. That decision has been pushed back to next year's spending review, for which no date has yet been set.

Healey resigned as defence secretary in June under then prime minister Keir Starmer, accusing Starmer of being unable, and the Treasury unwilling, to commit the resources needed to defend the country. In his resignation letter, he insisted Britain needed to set 2030 as the target date for reaching 3% of GDP on defence.

Since taking over as chancellor from Rachel Reeves following Andy Burnham's arrival as prime minister, Healey has stopped short of committing to that same 2030 deadline. Treasury sources said the budget's focus would instead be on fully funding the three-year defence investment plan (DIP), one of Starmer's final major announcements before leaving office. The plan currently has a funding gap of roughly £1.2bn a year, which Reeves had suggested would need to be covered by cuts elsewhere in Whitehall.

A government spokesperson said the prime minister and chancellor remain committed to fully funding the defence investment plan, and that next year's spending review will set out a pathway to meeting the UK's Nato commitment of 3.5% of GDP on defence by 2035, including a target date for reaching 3%.

Defence spending is currently projected to reach 2.7% of GDP by 2030, funded in part by Starmer's decision to cut the UK's international aid budget. Speaking to Sky News, Healey said fiscal discipline remained any chancellor's top priority, describing it as the foundation of economic stability. He is due to travel to North Carolina this weekend for a G20 finance ministers' meeting, where discussions are expected to cover global growth prospects amid high energy prices and trade tensions.