Connect with us

Published

on

Two serving ministers have broken cover to urge Rishi Sunak’s government to “lead the way” and increase defence spending to at least 2.5% at a time of growing threats.

In a highly unusual intervention, Anne-Marie Trevelyan, a foreign office minister and former defence minister, and Tom Tugendhat, the security minister and an experienced soldier, published an article online that does not appear to have been sanctioned by Downing Street.

“It’s clear to us that the UK needs to lead the way in increasing our own domestic defence and security spending commitments to 2.5% and beyond,” they wrote in a piece posted on Ms Trevelyan’s LinkedIn page on Friday evening.

“Former defence secretary Ben Wallace and prime minister Boris Johnson made inroads into growing our defence budgets, which had been shrinking in real terms for years. But that only filled the hole. Now we need growth.”

The alarm call by two serving ministers with deep expertise in defence and security comes amid growing disquiet among Conservative MPs and military insiders at a failure by Chancellor Jeremy Hunt to announce new funding for the armed forces in his spring budget, even though the defence secretary has warned the UK is in a “pre-war world”.

Instead, Mr Hunt just reiterated a vague pledge to increase defence spending to 2.5% of national income – from just over 2% at present – “as soon as economic conditions allow”.

Underlining their focus, Ms Trevelyan and Mr Tugendhat urged the government to strengthen the UK’s nuclear deterrent, regrow the Royal Navy, invest in more weapons and ammunition and accelerate plans to build a new generation of fighter jets for the air force.

They also stressed the need to invest in the UK’s defence industrial base.

“None of this is wasted cash. It’s investment in our own economy. And it protects our future economic security,” the ministers said.

“The sad truth is that the world is no longer benign. Protecting ourselves requires investment. And effective investment means that our industrial complex must grow and strengthen at much greater pace than at present.

“We cannot turn on the complex platforms and weapons which ensure military advantage overnight. We must start that growth now, invest at pace to support our allies and stay ahead of our adversaries.”

Read more from Sky News:
UK has no ‘credible’ plan to fund military equipment as multibillion-pound deficit revealed
Lord Cameron: UK involved in US port plans for Gaza ‘from the start’
Former prime minister Theresa May to stand down as MP at next general election

British Army soldiers crawl and fight through smoke and flares as they attack and move forward supported by armour during a Combined Arms Manouevre Demonstration on Salisbury Plain, Wiltshire. PRESS ASSOCIATION Photo. Picture date: Wednesday October, 21, 2015. Photo credit should read: Ben Birchall/PA Wire
Image:
British Army soldier training on Salisbury Plain, Wiltshire. Pic: PA

How UK defence spending compares to China and Russia

They pointed to how China has just announced a 7.2% rise in its defence budget to $230bn (£179bn) – more than twice what it was a decade ago.

Russia, they said, “is committed to spending 40% of its expenditure on defence and security this year. Vast sums by any standard to fight its illegal war in Ukraine”.

By contrast, UK defence spending has risen 28% from £43bn to £55bn over the last 10 years, they said.

The ministers did not specifically refer to this year’s budget, but military experts have expressed dismay that the level of funding set out in official tables on Wednesday appeared to track a decline of £2.5bn in defence spending in the financial year to March 2025 compared with the previous 12 months.

The Ministry of Defence said this was because the data did not include new money for the military that was pledged last autumn, as well as assistance to Ukraine.

British soldiers taking part in a NATO allied troops training exercise in North Macedonia. File pic: Reuters
Image:
British soldiers taking part in a NATO allied troops training exercise in North Macedonia. Pic: Reuters

Europe must secure borders, ministers say

Ms Trevelyan, who is charged with the Indo-Pacific region in the Foreign, Commonwealth and Development Office, underlined the importance of Europe stepping up to secure its borders as the United States increasingly focuses on the challenge posed by China.

Mr Tugendhat underlined the threats he sees at home “funded by illicit drug money, weapons trafficking and the abuses of modern slavery and people trafficking”.

He warned: “Those who wish our country, and our way of life, harm are more active than ever.”

Continue Reading

Politics

Building societies step up protest against Reeves’s cash ISA reforms

Published

on

By

Building societies step up protest against Reeves's cash ISA reforms

Building society chiefs will this week intensify their protests against the chancellor’s plans to cut cash ISA limits by warning that it will push up borrowing costs for homeowners and businesses.

Sky News has obtained the draft of a letter being circulated by the Building Societies Association (BSA) among its members which will demand that Rachel Reeves abandons a proposed move to slash savers’ annual cash ISA allowance from the existing £20,000 threshold.

Money blog: ‘I get paid to taste biscuits’

The draft letter, which is expected to be published this week, warns the chancellor that her decision would deter savers, disrupt Labour’s housebuilding ambitions and potentially present an obstacle to economic growth by triggering higher funding costs.

“Cash ISAs are a cornerstone of personal savings for millions across the UK, helping people from all walks of life to build financial resilience and achieve their savings goals,” the draft letter said.

“Beyond their personal benefits, Cash ISAs play a vital role in the broader economy.

“The funds deposited in these accounts support lending, helping to keep mortgages and loans affordable and accessible.

More on Rachel Reeves

“Cutting Cash ISA limits would make this funding more scarce which would have the knock-on effect of making loans to households and businesses more expensive and harder to come by.

“This would undermine efforts to stimulate economic growth, including the government’s commitment to delivering 1.5 million new homes.

“Cutting the Cash ISA limit would send a discouraging message to savers, who are sensibly trying to plan for the future and undermine a product that has stood the test of time.”

The chancellor is reportedly preparing to announce a review of cash ISA limits as part of her Mansion House speech next week.

While individual building society bosses have come out publicly to express their opposition to the move, the BSA letter is likely to be viewed with concern by Treasury officials.

The Nationwide is by far Britain’s biggest building society, with the likes of the Coventry, Yorkshire and Skipton also ranking among the sector’s largest players.

Read more from Sky News:
Trump tariff deadline extended as new threats issued
What happens to your pension when you die?

In the draft letter, which is likely to be signed by dozens of building society bosses, the BSA said the chancellor’s proposals “would make the whole ISA regime more complex and make it harder for people to transfer money between cash and investments”.

“Restricting Cash ISAs won’t encourage people to invest, as it won’t suddenly change their appetite to take on risk,” it said.

“We know that barriers to investing are primarily behavioural, therefore building confidence and awareness are far more important.”

The BSA called on Ms Reeves to back “a long-term consumer awareness and information campaign to educate people about the benefits of investing, alongside maintaining strong support for saving”.

“We therefore urge you to affirm your support for Cash ISAs by maintaining the current £20,000 limit.

“Preserving this threshold will enable households to continue building financial security while supporting broader economic stability and growth.”

The BSA declined to comment on Monday on the leaked letter, although one source said the final version was subject to revision.

The Treasury has so far refused to comment on its plans.

Continue Reading

Politics

Govt declines to rule out wealth tax after ex-Labour leader Lord Kinnock calls for wealth tax

Published

on

By

Govt declines to rule out wealth tax after ex-Labour leader Lord Kinnock calls for wealth tax

The government has declined to rule out a “wealth tax” after former Labour leader Neil Kinnock called for one to help the UK’s dwindling finances.

Lord Kinnock, who was leader from 1983 to 1992, told Sky News’ Sunday Morning With Trevor Phillips that imposing a 2% tax on assets valued above £10 million would bring in up to £11 billion a year.

Politics latest: Reeves’s tax turmoil deepens

On Monday, Sir Keir Starmer’s spokesperson would not say if the government will or will not bring in a specific tax for the wealthiest.

Asked multiple times if the government will do so, he said: “The government is committed to the wealthiest in society paying their share in tax.

“The prime minister has repeatedly said those with the broadest shoulders should carry the largest burden.”

He added the government has closed loopholes for non-doms, placed taxes on private jets and said the 1% wealthiest people in the UK pay one third of taxes.

Chancellor Rachel Reeves earlier this year insisted she would not impose a wealth tax in her autumn budget, something she also said in 2023 ahead of Labour winning the election last year.

Asked if her position has changed, Sir Keir’s spokesman referred back to her previous comments and said: “The government position is what I have said it is.”

Please use Chrome browser for a more accessible video player

Welfare: ‘Didn’t get process right’ – PM

The previous day, Lord Kinnock told Sky News: “It’s not going to pay the bills, but that kind of levy does two things.

“One is to secure resources, which is very important in revenues.

“But the second thing it does is to say to the country, ‘we are the government of equity’.

“This is a country which is very substantially fed up with the fact that whatever happens in the world, whatever happens in the UK, the same interests come out on top unscathed all the time while everybody else is paying more for getting services.

“Now, I think that a gesture or a substantial gesture in the direction of equity fairness would make a big difference.”

The son of a coal miner, who became a member of the House of Lords in 2005, the Labour peer said asset values have “gone through the roof” in the past 20 years while economies and incomes have stagnated in real terms.

In reference to Chancellor Rachel Reeves refusing to change her fiscal rules, he said the government is giving the appearance it is “bogged down by their own imposed limitations”, which he said is “not actually the accurate picture”.

A wealth tax would help the government get out of that situation and would be backed by the “great majority of the general public”, he added.

His comments came after a bruising week for Prime Minister Sir Keir Starmer, who had to heavily water down a welfare bill meant to save £5.5bn after dozens of Labour MPs threatened to vote against it.

With those savings lost – and a previous U-turn on cutting winter fuel payments also reducing savings – the chancellor’s £9.9bn fiscal headroom has quickly dwindled.

In a hint of what could come, government minister Stephen Morgan told Wilfred Frost on Sky News Breakfast: “I hold dear the Labour values of making sure those that have the broadest shoulders pay, pay more tax.

“I think that’s absolutely right.”

He added that the government has already put a tax on private jets and on the profits of energy companies.

Continue Reading

Politics

UK sentences 2 men to prison over $2M cold-calling crypto scam

Published

on

By

UK sentences 2 men to prison over M cold-calling crypto scam

UK sentences 2 men to prison over M cold-calling crypto scam

Two men who admitted to running a crypto scheme that defrauded 65 investors have both been sentenced to over five years in prison.

Continue Reading

Trending