Broken-down warships and Army in limbo: Inside UK’s defence row with Nato

Britain’s military is in limbo as Sir Keir Starmer tries to overcome resistance from his own ministers to unleash billions in spending for the UK defence industry.

Expectations have been high among military chiefs and contractors that the Government will next week finally launch a multi-billion pound package to fund upgrades to the UK’s weapons capabilities and better equip the country for war.

The long-awaited Defence Investment Plan (DIP), which was originally set to be published last autumn but has been delayed by Cabinet rows about spending, is expected to backed with billions of Government funding for new contracts with defence companies.

Starmer is facing increasing pressure from allies to boost defence funding in the wake of Russia’s invasion of Ukraine and conflicts in the Gulf, with the UK’s target for defence spending to reach 2.5 per cent of GDP by next April still leaving it lagging behind other European nations.

The i Paper revealed on Tuesday that Starmer was poised to unveil the DIP next week. However, some senior military officers have suggested that if the Government isn’t able spell out its plans by then, that defence reform may not happen for at least another year.

“I don’t think it will happen at all, as originally envisaged,” a former MP, defence minister, and Army veteran, told me this week.

A member of a Nato planning and equipment committee agreed that the Government’s plans appear to be being kicked into the long grass.

“Britain is now seen as suffering from its ‘say-do’ gap. It says a lot about supporting, and even leading, Nato and allied peace missions. And does very little – unlike the French,” said the official.

Nato sources believe that Starmer now risks open censure at the upcoming Nato summit in Turkey in early July for Britain’s poor performance, and failure to live up to its obligations under Articles 3 and 4 of the Nato treaty. These hold that a Nato partner must be capable of defending itself and be capable of helping an ally in need.

Before the Ankara meeting, Britain is obliged to produce a fully-funded defence plan. It must also spell out what it can and will contribute to Nato, beyond its Trident nuclear missile system.

The DIP is a key recommendation of the Strategic Defence Review of last June. The review called for a sustained increase in the UK’s defence budget, which currently stands at around £62 billion.

Last year the Government pledged to boost defence spending to 2.3 per cent of GDP immediately, rising to 2.5 per cent by 2027/28.

The Treasury found around £5bn in extra funds last year, but Chancellor Rachel Reeves has ruled out changing her fiscal rules or providing Treasury cash to bridge a reported £28bn funding gap faced by the Ministry of Defence (MoD).

Money needed for drones, missiles and AI systems

All four service chiefs have drawn up detailed plans of their requirements, and these plans were due to be answered and funded in the announcement originally scheduled for next Tuesday.

Most of the money is needed for acquiring new drones and missiles for Europe and the adoption of AI drive systems in all major services and departments. Above all ammunition and ordnance stocks need to be replenished as so much has been sent to Ukraine since 2022.

“The Government knows what we want – we’ve put the plans in, and they must decide. If they don’t, I fear that it will all drift into next year,” said one service source.

Despite clear earlier indications that DIP (Defence Investment Plan) was to appear next week – with sums like an extra £10bn to £15bn being mentioned, the MoD has gone into flat denial mode. Asked if an announcement is due next week, I got a flat “no” from the spokesman. “When is the DIP due ?” I asked. “No confirmed date,” was the reply.

This leaves the services in limbo. The Navy now has no patrol submarines of the Astute class available since HMS Anson returned from Australia and the Gulf. Only the two subs of the Trident force are available, one now on deep patrol.

There is a lack of deep dock repair facilities, stemming from the Cameron defence cuts. Only five frigates are listed as operational, only three fully available. The Type 23 class is very old, some physically cracking up.

HMS Iron Duke undertook a short deployment after a £100m refit involving 1.7 million maintenance worker hours. Three of the Type 45 destroyers are available – one, Dragon is now with the French-led Charles De Gaulle carrier group guarding the Gulf.

The British aircraft carrier Prince of Wales, 70,000 tonnes of it, is on exercise, requiring allied ships for escorts, and with a handful of Merlin and Wildcat helicopters as its main strike force.

Exercise exposes lack of missiles and equipment

Service chiefs are pressing ahead with upgrades in training and capability as much as the meagre funding will allow.

General Sir Gwyn Jenkins, head of the Navy is building a new hybrid fleet of manned and unmanned ships and submarines. Britain is offering to command a new Nordic Fleet within Nato, but what it can offer in ships and firepower is meagre.

Similarly, Britain is slated to lead, with France, a peace operation in Ukraine, should a deal ever be struck there. The same for the Gulf – Britain and France will lead a maritime mission to secure the Hormuz Strait, following a peace deal with Iran.

Britain’s forces are needed by allies as Putin’s Russia, increasingly desperate in Ukraine, is spreading its disruptive activities. Drone threats, signal jamming and spoofing is routine against Estonia and Latvia – and recently flying a drone into Romania.

Cyber bombardment and disruption is accelerating as Anne Kearst Butler, head of GCHQ, noted this week. Aggressive submarine patrolling and surveillance of vital energy and communications nodes is relentless in the Atlantic and North Sea.

The British Army is now embedding with the Strategic Defence Headquarters of Estonia, lending all the expertise and key equipment it can.

The crisis the forces face was illustrated brilliantly in an exercise ARRCADE Fire last week, at an underground bunker in London last week. The exercise simulated the use of the Asgard surveillance and targeting system, using AI to process targeting information – taking seconds and minutes at most, to strike at a major land attack from Russia.

The concept and architecture of project worked fine, but the glaring shortage of ordnance, missiles and equipment was obvious. The journalists watching were joined by the organisers of the exercise to press the Government to invest urgently in defence industries for this – a vital aspect of British security.

Labour leadership uncertainty could delay plans

Several groups in the City are prepared to put together a defence investment bond fund exclusively for defence equipment and systems. One has suggested it could raise £120bn on the bond market. This has received no response from the Government, the Treasury and armaments directorate of the MoD.

This may be a piece of party politics, which is why many in the UK defence and security world believe that if Starmer doesn’t declare the new fund for defence and security modernisation next week, it will all be put off to next year, or maybe never.

“It all goes into the political churn now – and if we have leadership contests we’ll have a sort of purdah,” said one close observer. They, are acutely aware that neither Wes Streeting nor Andy Burnham appear to see defence as a priority.

But a surprising source was prepared to lighten the gloom on defence prospects, based on acute observation from the touchline.

“I don’t think there will be a DIP. But I think the prime minister does understand the importance of this, and he is sweating on it. The problem is getting other ministers to support the need to find at least some money for defence. He [Starmer] will find some money – because he sees this as an important part of his legacy.

“He will find money. But the Ministry of Defence will be the last to know about it – as usual.”