Defence Funding

Lord Dannatt Excerpts

Thursday 17th September 2026 Lords Chamber

[Lord Pitt-Watson (Lab)]

That the Government have an absolute commitment to the defence of this nation; that we already have the third-highest absolute expenditure among our allies; that we will honour our NATO commitment of 3.5% by 2035 and set a target for 3% on defence at the spending review; and that in 2025 we committed to the largest sustained increase in defence spending since the end of the Cold War. That is not bad.

[Lord Dannatt (CB)]

My Lords—

[Baroness Meyer (Con)]

My Lords—

[Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)]

My Lords, it is the turn of the Cross Benches.

[Lord Dannatt (CB)]

My Lords, does the Minister agree that progress towards the 3% and 3.5% targets for defence spending can best be described as glacial? Will he undertake that the Treasury will look at imaginative ways of funding defence, in particular the innovative contribution that small and medium-sized enterprises can make, along with their access to private funding? It does not all have to come from the Treasury.

[Lord Pitt-Watson (Lab)]

I think the reference to private companies and what defence spending can do for the economy is very important. If I have my figures right, the additional investment we will be making will create 60,000 more jobs in the private sector. So we are aware of this important point and I thank the noble and gallant Lord.