The UK will be forced to agree this month to increase defence spending to 3.5% of national income within a decade as part of a NATO push to rearm and keep the US on side, Sky News understands.
The certainty of a major policy shift means there is bemusement in the Ministry of Defence (MoD) about why Sir Keir Starmer‘s government has tied itself in knots over whether to describe an earlier plan to hit 3% of GDP by the 2030s as an ambition or a commitment, when it is about to change.
The problem is seen as political, with the prime minister needing to balance warfare against welfare – more money for bombs and bullets or for winter fuel payments and childcare.
Image: Prime Minister Sir Keir Starmer during a visit to a military base training Ukrainian troops in April. File pic: PA
Sir Keir is due to hold a discussion to decide on the defence spending target as early as today, it is understood.
As well as a rise in pure defence spending of 3.5% by 2035, he will also likely be forced to commit a further 1.5% of GDP to defence-related areas such as spy agencies and infrastructure. Militaries need roads, railway networks, and airports to deploy at speed.
This would bolster total broader defence spending to 5% – a target Mark Rutte, the head of NATO, wants all allies to sign up to at a major summit in the Netherlands later this month.
It is being referred to as the “Hague investment plan”.
Asked what would happen at the summit, a defence source said: “3.5% without a doubt.”
Yet the prime minister reiterated the 3% ambition when he published a major defence review on Monday that placed “NATO first” at the heart of UK defence policy.
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1:46
What’s in the UK Strategic Defence Review?
The defence source said: “How can you have a defence review that says NATO first” and then be among the last of the alliance’s 32 member states – along with countries like Spain – to back this new goal?
Unlike Madrid, London presents itself as the leading European nation in the alliance.
A British commander is always the deputy supreme allied commander in Europe – the second most senior operational military officer – under an American commander, while the UK’s nuclear weapons are committed to defending the whole of NATO.
Even Germany, which has a track record of weak defence spending despite boasting the largest economy, has recently signalled it plans to move investment towards the 5% level, while Canada, also previously feeble, is making similar noises.
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2:37
Is the UK battle ready?
The source signalled it was inconceivable the UK would not follow suit and said officials across Whitehall understand the spending target will rise to 3.5%.
The source said it would be met by 2035, so three years later than the timeline Mr Rutte has proposed.
Defence spending is currently at 2.3%.
A second defence source said the UK has to commit to this spending target, “or else we can no longer call ourselves a leader within NATO”.
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Sky News’s political editor Beth Rigby challenged the prime minister on the discrepancy between his spending ambitions and those of his allies at a press conference on Monday.
Sir Keir seemed to hint change might be coming.
“Of course, there are discussions about what the contribution should be going into the NATO conference in two or three weeks’ time,” he said.
“But that conference is much more about what sort of NATO will be capable of being as effective in the future as it’s been in the last 80 years. It is a vital conversation that we do need to have, and we are right at the heart of that.”
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New Sky News podcast launches on 10 June – The Wargame simulates an attack by Russia to test UK defences
Mr Rutte, a former Dutch prime minister, said last week he assumes alliance members will agree to a broad defence spending target of 5% of gross domestic product during the summit in The Hague on 24 and 25 June.
NATO can only act if all member states agree.
“Let’s say that this 5%, but I will not say what is the individual breakup, but it will be considerably north of 3% when it comes to the hard spend [on defence], and it will be also a target on defence-related spending,” the secretary general said.
The call for more funding comes at a time when allies are warning of growing threats from Russia, Iran, and North Korea as well as challenges posed by China.
But it also comes as European member states need to make NATO membership seem like a good deal for Donald Trump.
The leaders of all allies will meet in The Hague for the two-day summit.
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The US president has repeatedly criticised other member states for failing to meet a current target of spending 2% of national income on defence and has warned the United States would not come to the aid of any nation that is falling short.
Since returning to the White House, he has called for European countries to allocate 5% of their GDP to defence. This is more than the 3.4% of GDP currently spent by the US.
Mr Rutte is being credited with squaring away a new deal with Mr Trump in a meeting that would see allies increase their defence spending in line with the US president’s wishes.
The NATO chief is due to visit London on Monday, it is understood.
Two senior Labour MPs have suggested the prime minister may have to go within months if the government continues to perform poorly.
Sky News’ deputy political editor Sam Coates said his sources – a member of the government and a prominent politician – have “put Sir Keir Starmer on notice”.
Both warned that, if Labour performs badly in next May’s elections across Wales, Scotland and London, it could mark the end of his time in Downing Street.
Coates added: “The level of unhappiness and despair in parts of the Labour Party is so striking that right now, on the first anniversary, I am hearing from ministers in government that Starmer might have to go in months.”
Reform UK is surging in the polls in Wales, while Labour faces a threat from left-wing parties such as the Greens in London.
It comes as the prime minister made it clear that Rachel Reeves has his “complete support” as chancellor and remains integral to his project, Sky News’s political editor Beth Rigby understands.
She looked visibly upset during Prime Minister’s Questions, with a spokesperson claiming she had been affected by a “personal matter”.
A day earlier, Sir Keir’s controversial welfare bill was passed despite a sizeable rebellion from Labour MPs, with major U-turns meaning a new £5bn black hole has appeared in the country’s finances.
One senior figure told Rigby that the pair were as “as close politically” as any chancellor and prime minister have ever been.
“She is going absolutely nowhere,” they added.
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2:58
Welfare vote ‘a blow to the prime minister’
Ms Reeves’s tears sent markets spiralling, with the value of the pound and long-term government bonds falling sharply.
Later in the day Sir Keir, said Ms Reeves will be chancellor for a “very long time to come”.
The prime minister said it was “absolutely wrong” to suggest her tearful appearance in the Commons related to the welfare U-turn.
“It’s got nothing to do with politics, nothing to do with what’s happened this week. It was a personal matter for her,” he said while speaking to the BBC’s podcast Political Thinking with Nick Robinson.
“I’m not going to intrude on her privacy by talking to you about that. It is a personal matter.”
Asked if she will remain in post, he said: “She will be chancellor by the time this is broadcast, she will be chancellor for a very long time to come, because this project that we’ve been working on to change the Labour party, to win the election, change the country, that is a project which the chancellor and I’ve been working on together.”
He said Ms Reeves has done a “fantastic job” and added: “She and I work together, we think together. In the past, there have been examples – I won’t give any specific – of chancellors and prime ministers who weren’t in lockstep. We’re in lockstep.”
Wes Streeting, the health secretary, also offered a strong defence for the prime minister and chancellor.
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11:07
Health Secretary: Reeves is ‘resilient’
He told Sky News this morning that Sir Keir has been “consistently underestimated” and was “of course” safe as prime minister.
And he said Ms Reeves was a “tough character” who was ” resilient” and “here to stay”.
Despite making “significant improvements”, Greater Manchester Police (GMP) has lost the “trust and confidence” of some victims of grooming gangs, according to a report by the police watchdog.
Michelle Skeer, His Majesty’s Inspector of Constabulary, said that since 2019, when GMP started to review its non-recent child sexual exploitation investigations, “the force has improved its understanding and approach to investigating allegations of child criminal and sexual exploitation”.
The document, published today, said police have live investigations into “multi-victim, multi-offender” child sexual exploitation inquiries, involving 714 victims and survivors, and 1,099 suspects.
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2:00
‘Our chance for justice’
But despite recording improvements, a report by His Majesty’s Inspectorate of Constabulary and Fire & Rescue Services (HMICFRS) also identified:
• Various training gaps within the investigation team • Lack of consistency in evaluating case files between social care, health and police • Failures to initially support victims meant they had “lost trust and confidence” in police
The report was commissioned by the Mayor of Greater Manchester Andy Burnham in 2024 to evaluate whether police, councils and health services can protect children from sexual exploitation in the future.
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1:40
Starmer to launch new grooming gang inquiry
The findings were issued as the final part of the CSE (child sexual exploitation) Assurance Review process which started in 2017. The first three reports examined non-recent child sexual exploitation in Manchester, Oldham and Rochdale.
Mr Skeer said that the force has been trying to improve its service to those who have experienced sexual exploitation, but previous failings have badly affected trust in GMP.
He said: “For some, trust and confidence in the police had been lost, and the force would not be able to rectify their experiences.
“It is vital that improvements are led by victims’ experiences, and if they do come forward, they are supported, protected and taken seriously.”
A recent report by Baroness Casey found a significant over-representation of Asian men who are suspects in grooming gangs in Greater Manchester, adding though authorities are in “denial” more needs to be done to understand why this is the case.
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6:52
Teen caught in child sex exploitation
Inspectors also said there were “training gaps” in some investigation teams and issues with data sharing, with local councils sometimes not willing to provide detectives with information, leading to “significant delays in investigations” into grooming gangs.
It cites problems with intelligence provided by Manchester City Council, which took months to arrive and “was so heavily redacted that some pages contained only a few words”, the report said.
GMP is the only force in the country to set up a dedicated team to investigate grooming gangs. Called the Child Sexual Exploitation Major Investigation Team (CSE MIT) it has about 100 staff and a ringfenced budget.
In October 2024, the force told inspectors there were 59 live multi-victim, multi-offender child sexual exploitation investigations, of which 13 were being managed by the CSE MIT.
The report adds: “The force fully accepts that it made mistakes in the past.
“It has taken positive and effective steps to learn from these mistakes and improve how it investigates recent and non-recent child sexual exploitation.”
Separately, the Baird Inquiry published in July 2024 found officers at GMP were abusing their power – making unlawful arrests, unlawful and demeaning strip searches, sometimes treating victims as perpetrators, and traumatising those who have suffered sexual abuse or domestic violence.
The health secretary has offered a strong defence of the prime minister and chancellor – ahead of Sir Keir Starmer setting out his 10-year vision for the NHS.
Wes Streeting dismissed suggestions the prime minister could be forced out in months following the toughest week of his premiership yet, and described Rachel Reeves as “resilient” and would “bounce back” following her tearful appearance in the Commons on Wednesday.
Overnight, two senior sources – a member of the government and a prominent politician – told Sky News’ deputy political editor Sam Coates that they had “put Sir Keir Starmer on notice”.
The health secretary, who was speaking as Sir Keir prepares to set out his 10-year vision for the NHS, said the prime minister had been “consistently underestimated”.
Asked by Kamali Melbourneon Sky News Breakfast whether Sir Keir was “safe”, Mr Streeting said: “Of course.
“Keir Starmer has been consistently underestimated. I wonder when people will learn.
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2:36
Reeves has ‘complete support’
“They said he couldn’t win the Labour leadership, but he did. They said he couldn’t change the Labour Party, but he did.
“They said he couldn’t take the Labour Party from its worst defeat since the 1930s to election victory last year. And he did and now the cynics say he can’t change the country, but he will.”
As for Ms Reeves – whose tearful appearance in the Commons spooked markets after the prime minister initially failed to back her, Mr Streeting said the chancellor was a “tough character” who was “resilient and she will bounce back”.
The health secretary declined to expand on why Ms Reeves was in the chamber at all yesterday, repeating that it was a personal matter.
“Rachel Reeves as chancellor is here to stay,” he continued.
“We need her to get the economy from strength to strength, to make sure that family finances are in better health than we were when we came into office.”
Speculation about the futures of the two most senior members of the government threaten to overshadow the announcement today, which the government says is “one of the most seismic shifts” in the health service’s history.
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3:05
Why has Starmer axed NHS England?
Sir Keir will pledge three main facets of the plan: moving care into the community, digitising the NHS, and a focus on sickness prevention.
The prime minister will announce neighbourhood health services will be rolled out across England to improve access to the NHS and to shift care out of overstrained hospitals.
Sir Keir has already promised thousands more GPs will be trained, and to end the 8am “scramble” for an appointment.
He also previously said his government will bring the NHS into the digital age, with “groundbreaking” new tools to support GPs rolled out over the next two years – including AI to take notes, draft letters and enter data.
And he will promise new contracts that will encourage and allow GP practices to cover a wider geographical area, so small practices will get more support.
Unite, one of the UK’s largest healthcare unions, welcomed the plan cautiously but said staff need to be the focus to ensure people are better looked after.
Sir Keir said: “The NHS should be there for everyone, whenever they need it.
“But we inherited a health system in crisis, addicted to a sticking plaster approach, and unable to face up to the challenges we face now, let alone in the future.
“That ends now. Because it’s reform or die.”
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2:04
Do you want AI listening in on chats with your doctor?
Neighbourhood health services
The newly announced neighbourhood health services will provide “pioneering teams” in local communities, so patients can more conveniently access a full range of healthcare services close to home.
Local areas will be encouraged to trial innovative schemes like community outreach door-to-door to detect early signs of illness and reduce pressure on GPs and A&E.
The aim is to eventually have new health centres open 12 hours a day, six days a week to offer GP services as well as diagnostics, post-operative care and rehab.
They will also offer services like debt advice, employment support, stop smoking help or weight management.
More NHS dentists
Dentists will also be part of the plan, with dental care professionals part of the neighbourhood teams.
Dental “therapists” will carry out check-ups, treatments and referrals, while dental nurses could give education and advice to parents or work with schools and community groups.
Newly qualified dentists will be required to practice in the NHS for a minimum period, which they have said will be three years.