Increase defence spending to 3% of GDP
Reform UK · what the evidence says
An independent, source-checked look at Reform UK’s policy “Increase defence spending to 3% of GDP” — what it would actually do across the things that affect your life. Every claim below quotes the source behind it. How this works.
Public finances & the next generation — Hurts
moderate · moderate confidence
Raising defence spending to 3% of GDP would cost around £17 billion extra per year by 2030, and the policy does not specify how this would be funded. Without a clear funding plan, the most likely result is higher borrowing, worsening the debt path for future generations.
The evidence
- The policy commits to raising defence spending to 2.5% of GDP by year three and 3% within six years. — reformparty.uk (manifesto) — “increase defence spending to 2.5% of national GDP by year three, then to 3% within six years”
- UK defence spending was 2.3% of national income in 2024-25. — ifs.org.uk (institutional) — “The UK's defence spending was 2.3% of national income in 2024-25”
- The OBR estimated that achieving 3% of GDP would require an additional £17.3 billion in 2029-30. — investing.com (media) — “The Office for Budget Responsibility (OBR) estimated that achieving 3% of GDP would require an additional £17.3 billion in the 2029-2030 fiscal year.”
- The IFS states that funding such an increase would require reducing other public spending, raising taxes, or increasing borrowing. — ifs.org.uk (institutional) — “Funding such an increase would necessitate difficult choices: reducing spending in other public services, raising taxes, or increasing government borrowing.”
- The ERC warns that reaching the 3% target could widen the fiscal deficit, leading to increased borrowing and strain on fiscal stability. — ercouncil.org (media) — “reaching the 3% target could widen the fiscal deficit, leading to increased borrowing, potentially higher interest rates, and strain on fiscal stability.”
Biggest unknown: Whether the spending would be offset by tax rises or cuts elsewhere, or instead borrowed — only the latter materially worsens the debt path.
Our reading: The policy commits to a substantial, permanent uplift in defence spending — an additional ~£17 billion per year by 2030 on OBR figures. The policy text contains no stated funding mechanism: no identified tax rises, no specified offsetting cuts, and no borrowing rule. The IFS is explicit that the only options are cuts elsewhere, tax rises, or borrowing. Where no mechanism is identified, the default fiscal risk is increased borrowing. The ERC similarly flags widening deficits and higher interest rates as likely consequences. These are projected rather than certain outcomes — if a future government offset the spending with tax rises or cuts, the debt-path impact would be contained. That is the biggest unknown. The net picture, absent a stated funding plan, leans toward a worsening of the debt path — moderate in magnitude given the scale of the spending commitment, and felt over the long term as the ramp-up builds to the 3% target. Confidence is moderate because the actual fiscal outcome depends heavily on the unspecified financing mix.
Good work & fair pay — Mixed picture
minor · low confidence
Spending more on defence could create jobs in military and manufacturing sectors, but it may also mean cuts to other public services that support workers. The net effect on ordinary people's pay and job security is small and uncertain.
The evidence
- The policy commits to raising defence spending to 2.5% of GDP by year three and 3% within six years, including improving quality of life for personnel. — reformparty.uk (manifesto) — “improve equipment, quality of life for personnel, and boost morale”
- UK defence spending was 2.3% of national income in 2024-25. — ifs.org.uk (institutional) — “The UK's defence spending was 2.3% of national income in 2024-25”
- Funding such an increase would require reducing other public spending, raising taxes, or more borrowing. — ifs.org.uk (institutional) — “Funding such an increase would necessitate difficult choices: reducing spending in other public services, raising taxes, or increasing government borrowing”
- Defence projects are expected to create jobs in military production and supporting sectors like construction and manufacturing. — ercouncil.org (media) — “Defence projects are expected to create jobs directly in military production and indirectly in supporting sectors such as construction and manufacturing”
- The defence industry represents only 0.4-0.5% of UK Gross Value Added, limiting the economic boost from higher spending. — lordslibrary.parliament.uk (government) — “the defence industry represents a relatively small portion of the UK economy (0.4-0.5% of Gross Value Added in 2023), limiting the overall economic boost”
- To effectively spend at 3% of GDP, a 25-30% increase in service personnel would likely be needed. — rusi.org (media) — “to effectively spend 3% of GDP, a 25-30% increase in service personnel numbers would likely be needed, raising regular personnel from 148,000 to approximately 190,000 by 2030”
- Increased borrowing to fund this commitment could add to the structural deficit and strain fiscal stability. — ercouncil.org (media) — “reaching the 3% target could widen the fiscal deficit, leading to increased borrowing, potentially higher interest rates, and strain on fiscal stability”
Biggest unknown: Whether the fiscal cost is met by borrowing, tax rises, or cuts to other public spending will determine whether workers gain or lose overall.
Our reading: The policy would expand the armed forces and increase procurement, generating some direct employment — particularly for service personnel and workers in defence-linked manufacturing and engineering. A 25-30% rise in personnel numbers would be a meaningful improvement in military employment and, per the stated text, in quality of life for those workers. However, the defence sector is very small (0.4-0.5% of GVA), so spillover job creation across the broader economy would be limited. The fiscal cost is large — an additional £17.3 billion by 2029-30 — and must be met through some combination of spending cuts, tax rises, or borrowing. Each route carries risks for ordinary workers: spending cuts could reduce public-sector employment or services workers depend on; tax rises could reduce disposable income; and higher borrowing risks higher interest rates. The opportunity cost to other public services is real, as analysts note funds could be diverted from infrastructure, healthcare, and education — sectors that also employ large numbers of workers. The net effect on O4 indicators (real wages, employment rate, job security, in-work poverty) is therefore mixed: modest direct job gains in defence and related industries, offset by fiscal pressures that could harm workers elsewhere. The defence industry's small share of the economy means the upside is bounded, while the fiscal downside is large. This makes the overall direction mixed at minor magnitude, materialising over the long term as the spending ramp-up and its fiscal consequences play out.
Crime, justice & national security — Helps
moderate · moderate confidence
Raising defence spending to 3% of GDP would meaningfully grow the size, equipment, and capacity of the UK armed forces, improving national security. The main caveat is that building up personnel numbers and industrial capacity takes many years, and fiscal pressures may slow or qualify the commitment.
The evidence
- The policy commits to raising defence spending to 2.5% of GDP by year three and 3% within six years, to increase armed forces size and capacity, improve equipment, and boost morale. — reformparty.uk (manifesto) — “increase defence spending to 2.5% of national GDP by year three, then to 3% within six years, to increase the size and capacity of the armed forces, improve equipment, quality of life for personnel, and boost morale”
- UK defence spending was 2.3% of national income in 2024-25, projected to rise to 2.5% by 2027-28 under existing plans. — ifs.org.uk (institutional) — “The UK's defence spending was 2.3% of national income in 2024-25, and it is projected to rise to 2.5% (or 2.6% including security services) by 2027-28”
- RUSI estimates that effectively spending 3% of GDP on defence would require a 25-30% increase in service personnel, from 148,000 to approximately 190,000 by 2030. — rusi.org (media) — “to effectively spend 3% of GDP, a 25-30% increase in service personnel numbers would likely be needed, raising regular personnel from 148,000 to approximately 190,000 by 2030, a return to 2010 levels”
- Soldiers are currently at a historic low, and the Defence Secretary does not expect numbers to rise until the early 2030s. — apnews.com (media) — “Defence Secretary John Healey stated that he does not expect the number of soldiers, currently at a historic low, to rise until the early 2030s”
- Achieving 3% of GDP on defence would require an additional £17.3 billion in 2029-30, per OBR estimates. — investing.com (media) — “The Office for Budget Responsibility (OBR) estimated that achieving 3% of GDP would require an additional £17.3 billion in the 2029-2030 fiscal year”
- The IFS notes that funding such an increase would require reducing spending on other public services, raising taxes, or increasing borrowing. — ifs.org.uk (institutional) — “Funding such an increase would necessitate difficult choices: reducing spending in other public services, raising taxes, or increasing government borrowing”
Biggest unknown: Whether the fiscal headroom exists to reach 3% on the stated timeline without crowding out other spending, and whether personnel numbers can be recruited at the scale required.
Our reading: The policy commits to a substantial and time-bound increase in defence spending — from the current 2.3% to 3% of GDP — with explicit aims to grow armed forces size and capacity, improve equipment, and raise personnel welfare. For O5, the relevant question is whether this improves national security and defence posture. The evidence supports a moderate improvement over the long term. A larger, better-equipped military with improved morale directly strengthens the UK's national security and resilience to external threats, which are core O5 indicators. RUSI's analysis indicates that reaching 3% would likely require growing personnel from 148,000 to around 190,000 — a return to 2010 levels — which represents a real structural improvement in defence capacity. The increase in capital budgets noted in the evidence also prioritises investment in equipment and capability. However, several factors cap confidence and magnitude. Personnel numbers are currently at a historic low and the Defence Secretary does not expect growth until the early 2030s, suggesting the timeline for the security benefit is genuinely long-term. The fiscal challenge is real: the OBR estimates an additional £17.3 billion would be needed by 2029-30, and the IFS notes this must come from cuts elsewhere, tax rises, or borrowing. These constraints create delivery risk. The policy text's trajectory (2.5% by year three, 3% by year six) is more ambitious than current government plans, which already project reaching 2.5% — meaning the genuine additionality of this policy vs. the counterfactual is primarily the step from 2.5% to 3%, and its faster timeline. That increment is real but bounded. Direction is 'improves' because the mechanism — more spending on forces, equipment, and personnel — directly and plausibly strengthens defence capacity, and the evidence from RUSI and others supports it firing at scale. Magnitude is moderate rather than major because delivery risk and fiscal constraints are substantial.