Ministry of Defence’s settlement at the Spending Review 2015
The Chancellor has published the results of the spending review, including details of the MOD budget over the course of this parliament.
The Spending Review and Autumn Statement delivers on the government’s priority to provide security to working people at every stage of their lives. It sets out a four year plan to fix the public finances, return the country to surplus and run a healthy economy that starts to pay down the debt. By ensuring Britain’s long term economic security, the government is able to spend £4 trillion on its priorities over the next four years.
For the Ministry of Defence this means:
- increasing the MOD’s budget by 3.1% in real terms to 2019-20 as part of the government’s commitment to spend 2% of GDP on defence;
- an investment of £1.2 billion over 10 years to ensure a Queen Elizabeth Class carrier is able to deploy with 24 jets on board from 2023, as well as investing almost £2 billion in UK Special Forces;
- £2.1 billion from the Joint Security Fund to fund and deliver the MOD’s SDSR commitments in full, maintaining the current levels of the Armed Forces and building four new submarines to renew the nuclear deterrent;
- savings of £9.2 billion, including £2 billion from pay restraint, £2.1 billion from improved commercial terms in the Equipment Plan, and reprioritisation of £2 billion of existing funding, all of which will be reinvested to fund the SDSR commitments.
| Ministry of Defence | ||||||
| £ billion | ||||||
| Baseline | Plans | |||||
| 2015-16 | 2016-17 | 2017-18 | 2018-19 | 2019-20 | 2020-21 | |
| Resource DEL (1) | 27.2 | 27.8 | 28.5 | 29.2 | 30.0 | 31.0 |
| Capital DEL | 7.1 | 7.3 | 7.5 | 7.8 | 8.1 | 8.7 |
| Total DEL | 34.3 | 35.0 | 36.0 | 37.0 | 38.1 | 39.6 |
(1) In this table, Resource DEL excludes depreciation
Security
The MOD will make over 170 investments to sustain and enhance defence capabilities. The government will invest £11 billion in new capabilities, innovation and the defence estate, to ensure that the Armed Forces are able to continue to project power with greater global reach. This includes creating two new strike brigades of up to 5,000 personnel, fully equipped to deploy rapidly and sustain themselves in the field, additional squadrons of upgraded Typhoon aircraft, increased provision of Intelligence, Surveillance and Reconnaissance aircraft and further support to UK Special Forces to conduct global counter terrorism operations. As a result of new investments the 10-year Equipment Programme will rise from £166 billion to £178 billion.
Long term investment
The defence estate will become more efficient and better suited to modern needs. Land will be released, creating space to build 55,000 homes including in areas of high demand. Investment in new and renewed equipment will continue to support UK industry. Renewing the nuclear deterrent secures 6,800 jobs at Faslane alone, meaning it will continue to be one of the largest single site employers in Scotland.
Reform
The MOD will deliver £9.2 billion of savings while maintaining the current number of Armed Forces personnel. All of these savings will be directly reinvested into the defence budget to enable investment in new capability to protect the UK’s national security. These savings will be made from military and civilian pay restraint, reductions to the civilian headcount, the ending of military commitment bonuses, reductions in travel expenditure and professional fees as well as further efficiencies within the Equipment Programme by ensuring that the MOD gets the best commercial terms when buying new equipment.
Defence Secretary Michael Fallon said:
National Security is the top priority for this government. This Spending Review will enable us to invest in the cutting edge equipment our world-class Armed Forces need to keep Britain safe at home and abroad. We will increase our 10-year Equipment Programme by £12 Billion and continue to meet the NATO 2% GDP target for the rest of this decade. This means more ships, more planes, more troops ready to act, better equipment for Special Forces and more money for cyber.