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Rishi Sunak contemplates defence budget boost amid warship concerns and foreign threats

15 February 2024, 15:39 | Updated: 27 February 2024, 08:18

HMS Prince of Wales departs Portsmouth on Monday 12th February  for Exercise Steadfast Defender in place of its sister ship HMS Queen Elizabeth
HMS Prince of Wales departs Portsmouth on Monday 12th February for Exercise Steadfast Defender in place of its sister ship HMS Queen Elizabeth. Picture: Alamy
Natasha Clark

By Natasha Clark

Rishi Sunak is considering boosting Britain's defence budget next month after a string of embarrassing reports about the state of our warships.

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Government sources said extra money for Britain's defence war chest was on the cards after Britain became involved in attacks on Iranian-backed Houthi rebels last month.

Meanwhile, former Defence Secretary Ben Wallace is lobbying for the Chancellor and PM to set firm dates in stone to hike defence spending to 2.5 per cent by 2028, and 3 per cent by 2030, LBC understands.

MPs are pressuring the PM and Chancellor to make defence a big pledge at what could be the last major fiscal event before the budget.

Mr Hunt has said it is an "aspiration" to raise defence spending but only "as the fiscal and economic circumstances allow".

Growing threats from the situation in the Red Sea, alongside ongoing conflict in Israel and Gaza, and in Ukraine, have pushed defence up the foreign affairs agenda in government, MPs say.

One government source said: “If, after we’ve used any headroom to do some of the things we want, we have spare for defence, then of course we will look at that.”

Another added: “We’re all keen if there’s headroom."

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However, LBC understands that the Chancellor received the final set of OBR figures last night - and the headroom is less than previously thought with billions fewer to spend.

The PM and Chancellor have said they want to prioritise tax cuts if they can in a bid to grow the economy and make people feel better off ahead of the election.

Ministers are also considering plans to upgrade Type 45 warships to allow them to fire missiles to hit more targets, Former Defence Committee Chair Tobias Ellwood has told LBC.

He claimed the upgrades could cost a few million pounds - compared to hugely costly billion-pounds hikes to defence spending.

Houthi fighters march during a rally of support for the Palestinians in the Gaza Strip and against the U.S. strikes on Yemen
Houthi fighters march during a rally of support for the Palestinians in the Gaza Strip and against the U.S. strikes on Yemen. Picture: Alamy

At the moment ships like HMS Diamond cannot attack Houthi targets on land, and have been carrying out drone attacks instead.

The Royal Navy are already in the progress of putting strike missiles on some Type 23 frigates and Type 45s already as part of a collaboration with the Norwegian government.

Britain's typhoon jets have helped to conduct both air and ground attacks - but have to fly in from 1,500 miles away from RAF Akrotiri.

The Chancellor has said he wants to use any cash headroom for tax cuts in the upcoming Budget as borrowing figures have come in at less than expected.

It comes after a committee of MPs warned last month that Britain could not take part in a full-blown war because of chronic underfunding and hollowing out of our armed forces.

Earlier today Mr Hunt refused to deny reports he was looking at some public spending squeezes in the upcoming Budget, which will take place on March 6.

He said: "Well, you will have to wait for the Budget for the decision that the Prime Minister and I eventually make.

"But what I would say is that I was Health Secretary for nearly six years, I negotiated a lot of extra money for the NHS, I am a passionate supporter of the NHS and all our public services.

"What you will see in everything I do in the Budget is prioritising economic growth."

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