The government has been “effectively raiding” the defence budget in times of peace and must now invest more to meet “growing” threats, the defence secretary has said.
Reports suggest Mr Wallace is looking to get up to £11bn in extra cash for the Ministry of Defence (MoD), but The Times says officials are reluctant due to recent failed projects and “wasteful spending”.
Asked by Sky News’ Kay Burley if the MoD was wasting money, the defence secretary said: “I think the Treasury will make that point as I asked for more money.”
He added: “Look, historically, the MoD has bought into equipment that I think hasn’t necessarily delivered. But remember, 85% of our procurements are on budget [and] on time.
“That doesn’t change the fact that the threat is growing and what we’ve seen since 1991, since the end of the Cold War, is a consistent, effectively raiding of the defence budget over time.
“Maybe a peace dividend was appropriate straight after the Cold War. We had huge armies in Europe. The Cold War finished and it was right that the taxpayer who’d invested in defence got a return on that.
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“The problem is that continued and has continued for many decades as the threat has increased. And I’ve been very open here that the threat has increased.
“And just like other parts of government, when demand threat increases, we should reconsider how much we fund it.”
“That, of course, means it’s going to pinch all of us in all our departments because, you know, ultimately the answer cannot therefore be to flood everything with extra spending or more borrowing,” he said.
“But I also know that we have a growing threat on the world stage.”
It’s been more than a year since a ceasefire was agreed in Lebanon, but data shows that the truce between Israel and Hezbollah is more fragile than ever.
The independent conflict monitoring organisation ACLED has recorded 1,846 Israeli attacks on Lebanon since the ceasefire began.
On average, only two days of each month have not seen an Israeli attack.
The bombings have grown more frequent in recent weeks, with an average of six per day so far in December, or one every four hours – the fastest pace of attacks since March.
The Lebanese children bombed by Israel
Israel says it is targeting Hezbollah military infrastructure
The ceasefire deal requires both sides to withdraw from southern Lebanon, the area south of the Litani river.
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The UN mission in southern Lebanon, UNIFIL, says the agreement has been violated more than 10,000 times – once every 53 minutes.
That includes the attacks monitored by ACLED, as well as more than 2,500 IDF ground activities and over 7,800 violations of Lebanese airspace.
It also includes the discovery, by UNIFIL, of more than 360 weapon and ammunition caches south of the Litani river.
Israel says that these caches are evidence that Hezbollah is seeking to rebuild its military infrastructure in southern Lebanon, an allegation denied by both Hezbollah and UNIFIL.
“None of these weapon caches were guarded,” says UNIFIL deputy spokesperson Kandice Ardiel. “They had no obvious signs of recent use and were presumably abandoned. Many were even destroyed already, or half-destroyed.”
An IDF spokesperson said that Hezbollah’s attempts to rebuild its military infrastructure in southern Lebanon “are not open to interpretation”.
“In the absence of sufficient enforcement by UNIFIL, and out of commitment to the security of the Israeli civilians, the IDF continues to operate in a focused manner against Hezbollah’s restoration attempts,” the spokesperson said.
At least 127 civilians have been killed by Israeli attacks since the ceasefire began, according to the UN.
Israel argues that the ceasefire agreement requires Hezbollah to disarm in all parts of Lebanon, not just the south. Hezbollah disputes this, and says it will not consider full disarmament until Israel withdraws entirely from Lebanese territory.
Israel has established five military bases inside Lebanon
This withdrawal was supposed to take place by 27 January 2025, a deadline that was later extended to 18 February.
But instead of withdrawing from its Lebanese bases, Israel began cementing its presence.
Sky News has confirmed, based on satellite imagery, that Israel started construction on a new base, shown below, between 8 and 18 February – within days of the withdrawal deadline.
Image: Israeli base on Tzivoni ridge, Lebanon, 18 November 2025. Pic: Planet Labs PBC
Israel retains control of four other bases on Lebanese territory, scattered along hilltops near the border.
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“We need to remain at those points at the moment to defend Israeli citizens, to make sure this process is complete and eventually hand it over to the Lebanese armed forces,” IDF spokesman Nadav Shoshani said in February.
Lebanon has raised complaints with the UN about these bases, as well as Israel’s recent extension of its border wall. The UN says that two sections of the wall cross into Lebanese territory, putting around one acre on the Israeli side.
Image: Israeli border wall under construction near Yaroun, 18 November 2025. Pic: Planet Labs PBC
Sky News asked the IDF whether it accepted the UN’s findings, but did not receive a response to this question.
In the image below, part of the newly constructed wall can be seen passing between border posts, highlighted in green, into Lebanese territory.
Image: A newly-constructed portion of Israel’s border wall is seen crossing into Lebanon, with border posts highlighted. Pic: AP
Construction of the wall resumed over summer, having been halted since hostilities erupted in October 2023. Based on satellite imagery, Sky News estimates that a total of 12km of wall have been erected in recent months.
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The continued presence of Israeli forces has hampered reconstruction efforts. More than 64,000 Lebanese people remain displaced from their homes.
Sky News visited one of the towns that sits in view of the Israeli base on Mount Balat. The town, Aita al Chaab, has been almost entirely destroyed.
Image: Wreckage in the border town of Aita al Chaab
Satellite imagery, taken on 24 November, shows the town in ruins. Out of 326 buildings in the town centre, 293 (91%) have been destroyed.
Since the ceasefire began, the destruction has continued and has spread to the Aita al Chaab’s outskirts.
“Anyone who comes to rebuild is attacked [by Israel],” one resident told Sky News.
The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.
EU leaders will meet in Brussels today to try to agree the release of €210bn (£184bn) to help fund Ukraine’s war with Russia.
The money, which comes from Russian assets frozen after Moscow’s full-scale invasion of Ukraine in 2022, is mostly held in the Belgian-headquartered clearing house, Euroclear.
The money is seen as vital to Ukraine’s ability to keep fighting, because the country faces bankruptcy in early 2026 if it doesn’t receive more international assistance. That means Kyiv would no longer be able to pay soldiers, police and civil servants or buy weapons to defend itself.
Image: Volodymyr Zelenskyy, Sir Keir Starmer, French President Emmanuel Macron and German Chancellor Friedrich Merz. Pic: Reuters
Last night, Volodymyr Zelenskyy, who is expected to brief the EU leaders today, wrote on X: “The result Europe produces – must make Russia feel that its desire to continue the war next year is pointless, because Ukraine will have support. This rests entirely with Europe.”
The Belgian government has so far prevented the move amid fears it will expose the small country to Russian legal action in the future.
The EU is racing to find solutions to Belgium‘s concerns, including passing an emergency bill that secures the sanctions against Russia indefinitely, superseding the need to renew them every six months and thereby insulating it from veto votes from Russian-leaning EU member states like Hungary and Slovakia.
Belgium also wants guarantees that all EU members will share any financial cost of Russian action against it.
Starmer tells Abramovich to pay £2.5bn
Why the push to use Russian assets?
The US, which has so far given billions of dollars to Kyiv, is losing interest under Donald Trump and can no longer be relied upon for financial support.
Previously, the EU had been giving the interest generated from the frozen assets to Ukraine, but was worried it might destabilise the Eurozone economy if it touched the assets itself.
That has changed, however, as Ukraine’s need has become more acute and fears over Russia’s wider imperialist ambitions have grown in recent months.
This unlocking of seized Russian assets is also being seen as a way to buy Brussels more leverage in peace negotiations, as well as reducing Kyiv’s dependency on Washington.
German Chancellor Friedrich Merz, who has been leading the campaign to release the funds, warned that “Europe would be severely damaged for years” if they fail to pass the vote and “this step is not about prolonging the war but about bringing the war to an end as soon as possible”.
In short, the consequences of using the frozen assets are now considered less risky than the consequences of not taking this action.
What’s at stake?
Trump wanted the money to be invested in two US investment funds, something the EU rejects. The US president has recently been scathing of European leaders, and the EU sees Thursday’s meeting as an opportunity to show its strength and unity.
In theory, the EU could pass the policy by majority vote, thereby sidelining the Belgian government, but officials are reluctant to go down this path for fear of alienating Belgium and causing a diplomatic rift in the alliance.
Much is riding on the meeting. If the EU fails to pass the vote, its credibility will take a severe blow. It will likely become even more irrelevant in peace talks, and Vladimir Putin might look to take advantage of a divided Europe.
Some 22 victims remain in hospital following the shooting, carried out at an event marking the start of the Jewish celebration of Hanukkah.
THE CONFIRMED VICTIMS
Eli Schlanger, a 41-year-old British-born rabbi
Rabbi Yaakov Levitan, secretary of a local Jewish group
Matilda, a 10-year-old girl whose family moved to Australia from Ukraine
Dan Elkayam, a French citizen
Alexander Kleytman, 87, a Holocaust survivor
Peter Meagher, a retired policeman
Reuven Morrison, a businessman
Tibor Weitzen, 78
Marika Pogany, an 82-year-old Slovakian woman
Boris and Sofia Gurman, a Russian-Jewish couple who were killed trying to confront one of the gunmen
Reuven Morrison, 62, who was also shot dead when trying to intervene, according to CBS who spoke to his daughter
Image: People look at flowers laid out for the victims. Pic: Reuters
At the first of the funerals, relatives mourned the death of British-born Rabbi Eli Schlanger, a 41-year-old father of five, who organised the Chanukah by the Sea event.
Often speaking through tears, his father-in-law, Rabbi Yehoram Ulman, expressed his “biggest regret” that he “could have done more” to tell him “how much we love him”.
“I hope he knew that. I’m sure he knew it,” he added. “But I think it should’ve been said more often.”
Image: Relatives of Rabbi Eli Schlanger next to his coffin during his funeral. Pic: Reuters
The father of 10-year-old victim Matilda, whose surname has been withheld at her family’s request, spoke at a vigil on Tuesday night.
Local media reported him as saying: “We came here from Ukraine… and I thought that Matilda is the most Australian name that can ever exist.
Police have said the two alleged gunmen – who were shot by officers – were motivated by Islamic State ideology.
A recent trip to the Philippines is under investigation. The older Akram used an Indian passport to travel, while his son used an Australian one.
The Akrams stayed at the GV Hotel in Davao from 1 November to 28 November, according to a source, who said police had visited on Wednesday.
The pair are said to have only left their rooms for meals and no one was seen visiting them.
Davao is in an area associated with Islamic extremism but a spokesman for the president of the Philippines said he rejected the claim the country is an “ISIS training hotspot”.
New details revealed on Bondi gunmen
New South Wales to debate gun reforms
The Australian government and intelligence services have come under pressure because the alleged attackers were legally able to acquire the high-powered rifles and shotguns used in the attack.
Prime Minister Anthony Albanese has vowed to toughen the country’s gun laws after its deadliest mass shooting in three decades, and the state parliament in New South Wales will reconvene next week to discuss reforms.
They include capping the number of guns allowed by a single person and making some shotguns harder to access.
State premier Chris Minns told a news conference: “We’ve got a monumental task in front of us. It’s huge.
“It’s a huge responsibility to pull the community together.
“We need a summer of calm and togetherness, not division.”
Woman shielded children from bullets
Mr Albanese has vowed to work with the Jewish community to “stamp out and eradicate antisemitism”. The prime minister has been accused of not doing enough to prevent its spread since the war in Gaza began two years ago.
Fellow world leaders have expressed their shock and anguish since the attack, including British Prime Minister Sir Keir Starmer, who hosted a Hanukkah event at Downing Street on Tuesday.
PM hosts Hanukkah event at Downing Street
And speaking at the White House last night, US President Donald Trump said: “We join in mourning all of those who were killed, and we’re praying for the swift recovery of the wounded.”