MoD asked make £1bn of cuts which put Nato spending target at risk, source claims

As a member of the alliance, the UK is supposed to maintain defence spending at 2 per cent of GDP

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The Ministry of Defence has been asked to find cuts of £1bn to spending this year which analysts warned could lead the UK falling down on its commitment to Nato.

As a member of the alliance, the UK is supposed to maintain defence spending at 2 per cent of GDP, although many other countries spend less than that.

The Treasury has asked ministries – apart from health, education and international development – to make savings totalling £3bn, including £1bn from Defence, The Times reported.

A defence source told the paper: “The department is on budget so you would have to stop doing a lot of stuff.”

The insider added that reducing spending by £1bn this year “would not be a thing you could just swallow and carry on”.

Malcolm Chalmers, of the Royal United Services Institute, warned defence cuts of that level would put the 2 per cent target at risk.

“The UK might still be able to get to 1.951 per cent, which could be rounded to 2 per cent, if the economy grows more slowly than was forecast in the last budget and/or more use is made of the Treasury reserve for operational spending,” he said.

Defence analyst Paul Beaver, a defence analyst, said the MoD could delay delivery of F-35 fighter jets and other hardware, but this would not cover the required amount.

“The only way to [save £1bn] is by stopping doing things. That is really, really difficult,” he said.

An MoD spokeswoman said the Government expected to meet the Nato spending target.

“We are confident that we will spend 2 per cent of GDP on defence in this financial year. The prime minister has also made clear that there will be an annual 1 per cent real-terms increase in spending on defence equipment throughout this parliament,” she said.

An unnamed Government minister also told The Times that his department was “looking for savings of around 5 per cent in year cuts”.

“This can be achieved through efficiencies: I haven’t been asked to look at stopping providing specific services. We’ve been planning for this and [it] should not really come as a surprise to anyone,” the minister added.

A Treasury spokesman said departments had been asked “to identify options” and said there was “no savings target” for this year.