The UK government published its Defence Investment Plan on 30 June 2026, promising to raise annual defence funding from £54 billion to almost £80 billion by 2029. This is a real-terms increase of 27%, with defence spending rising from 2.3% to 2.7% of the country's economic output.

The Ministry of Defence budget for 2027–28 is set at £74 billion, according to the published plan. That is £20 billion more than the final year under the previous government. The government has accelerated the 2.5% of GDP threshold to 2027 — five years earlier than previously scheduled. Ministers have also stated an ambition to reach 3% within the next planning period, which would exceed any formal NATO commitment currently on the books.

What the money buys

The largest new programme is drone transformation. More than £5 billion is earmarked over four years — the biggest investment in UK Armed Forces history, the MoD says. Within that sits more than £1 billion for a digital-targeting system that lets ground troops co-ordinate attacks in real time. Full operational use is planned for 2027.

Royal Navy and Armed Forces accommodation receives more than £1.5 billion in additional funding. Military bases have deteriorated across decades of tight budgets, and this money is intended to upgrade housing and facilities.

The RAF's Eurofighter Typhoon fighters gain £204.6 million for the ECRS Mk2 radar upgrade. This is a next-generation system that substantially improves the aircraft's electronic warfare capability — its ability to detect, evade and counter enemy radar and missiles. That contract was confirmed in June 2025.

Ukraine support sits alongside the core spending commitments rather than within them. The UK announced a £450 million surge package for Kyiv's armed forces, with £350 million drawn from this year's £4.5 billion military support allocation for Ukraine.

The political argument

The scale of the numbers has not insulated the plan from challenge. Liberal Democrat leader Ed Davey said on 30 June 2026 that the investment plan was "late and underfunded." His party's defence spokesperson, James MacCleary MP, questioned the government's approach. The Lib Dems indicated they would table a Humble Address — a parliamentary mechanism that compels the government to release documents or answer specific questions — to force disclosure of details they said were missing. They have also separately proposed Defence Bonds as an alternative funding model, though the government has not taken that up.

The Humble Address is an unusual move but not unheard of. It has been used in recent Parliaments on sensitive subjects where opposition parties judged that routine questions or select committee scrutiny would yield too little.

Reading the numbers

The trajectory from 2.3% to an ambition of 3% of GDP represents a substantial shift in how Britain allocates its public spending. For context: the UK last sustained defence spending at or above 3% in the early 1990s. Reaching that level again would, on current economic projections, mean an annual defence budget of well over £90 billion — larger than the entire NHS budget was at the start of this decade.

What the plan does not yet resolve is what happens after 2029. The ambition to reach 3% is clear; the timetable and the Treasury budget room needed to get there are not. That gap is exactly where the Lib Dems' Humble Address challenge is aimed, and where the Treasury's position matters as much as the MoD's.

The heavy investment in drones and digital targeting reflects a doctrinal shift drawn from the war in Ukraine. The fighting there has shown that large numbers of autonomous systems — drones and networked weapons — carry weight in modern conflict in ways that older, larger platforms alone cannot match. The £5 billion drone commitment is the clearest expression of that conclusion in the plan.