Starmer raises UK defence spending to 2.5% of GDP as Iran war reshapes British security calculus
Prime Minister Keir Starmer announced that the UK will reach 2.5% of GDP on defence within two years, bringing forward spending commitments that had been politically contested and allocating resources to naval and cyber capabilities.
World — March 11, 2026
Prime Minister Keir Starmer announced in March 2026 that the United Kingdom would bring forward its commitment to spend 2.5% of GDP on defence, with the target now to be reached within two years rather than by the end of the decade — a decision accelerated by the Iran conflict and sustained pressure from NATO allies who viewed Britain's 2.3% spending rate as insufficient given the scale of global instability.
Starmer, addressing the House of Commons, described the announcement as a reflection of 'a world that has changed beyond recognition' and said the government would prioritise investment in naval capabilities, cyber warfare, and intelligence — areas where officials assessed the UK had critical gaps.
The increase will require either higher borrowing or spending reductions elsewhere in the budget, a tension that Starmer's Cabinet has struggled to resolve. The Chancellor of the Exchequer indicated that the government would issue additional gilts to fund the rise rather than cut social spending, a decision that rating agencies said they were monitoring.
The announcement followed months of US pressure on European allies to increase defence contributions. The Trump administration had made explicitly clear that countries spending below 2.5% of GDP would face questions about the depth of America's Article 5 commitment under NATO's collective defence clause.
Britain's defence industry welcomed the increase. BAE Systems, Rolls-Royce, and QinetiQ all issued statements highlighting their capacity to absorb increased procurement contracts. BAE Systems shares rose 8% on the day of Starmer's announcement.
The opposition Conservatives accused the government of 'following rather than leading' on defence, arguing that the spending target should have been set higher. Reform UK's Nigel Farage called the announcement 'too little, too late.'
Analysts noted that the UK's decision to bring forward the 2.5% commitment aligned it with Germany and Poland as one of the European members most visibly responding to US pressure — a positioning that Starmer had previously been reluctant to adopt, given his concern about alienating the party's left wing.
