Rising European Defence Budgets?

A curious thing is happening in continental Europe: defence spending is rising. The United Kingdom may soon be among only a handful of nations with fewer resources for defence at a time of increasing commitments.

Earlier this week, France joined a growing number of European nations including Germany, Sweden, the Netherlands and Poland to increase defence spending (see table 1). The revision of military spending plans by key European allies prompts questions for the UK’s own military spending and even broader defence policy ahead of general elections next week.

Table 1: Revised military spending plans of selected European states


Revised spending plans

Date of announcement


+ €3.8bn between 2016 and 2019

April 2015


+ €1.1bn between 2016 and 2020

April 2015


+ €8bn between 2016 and 2019

March 2015


+ €175 million in 2015

October 2014


+ €50 million  in 2015
+ €150 million in 2016
+ €100 million p.a. from 2017 onward

September 2014


+ €33.6bn till 2022
2 per cent of GDP pa from 2022 onwards

December 2012

Source: authors’ analysis based on governmental and media resources.

A recent report by the Stockholm International Peace Research Institute (SIPRI) looking at defence budgets for 2015 suggests this trend is much broader. Only seven out of the twenty-two European nations examined have planned any real term decreases in 2015 and that number will drop even further  in 2016 when France and Germany start to boost their spending with the former realising a real term increase of 1.11 per cent and the later an even stronger real term increase of 2.44 per cent from 2015 to 2016 when accounting for the latest IMF inflation projections.

In France, the €4bn increase in total defence spending over the next four years is driven by domestic security concerns and the threat from extremist non-state actors rather than threats from a resurgent Russia. A significant share of the French uplift will be used to sustain the 7,000 soldier strong contribution of their armed forces to the domestic security operation ‘Sentinelle’, initiated following the Charlie Hebdo attacks in January. The additional funding will also enable the French Ministry of Defence to preserve 18,500 of the originally planned 34,000 jobs to be cut thereby easing the pressure on the French armed forces committed to operations overseas. As General Denis Mercier pointed out in a recent speech in Washington DC, threats to national security often need to be mitigated at range. ‘I believe we will remain [in Iraq] and keep fighting terrorism there because if we do not do that, for sure, in a few months terrorism will be there in Paris.’

In Germany, of the €8bn uplift, €1.2bn is earmarked for investments into the future development of the Bundeswehr, €0.3bn for increased NATO exercises and €1bn for new procurement projects in between 2016 and 2019. As for the rest of the uplift some qualifications need to be made. €1.7bn are merely the result of a change in accounting with redundancy payments for civilian Bundeswehr staff being moved from the general expenditures budget into the defence budget. Further €3.3bn are the result of the latest civil servants’ salaries review that also applies to military staff. There is also increasing public support for additional military expenditures demonstrated by the reactivation of a tank battalion and the re-acquisition of 100 Leopard2 main battle tanks.

Poland, which has recommitted to the NATO 2 per cent target has attributed an additional €33.6bn between 2013-2022 and embarked an incredible programme of modernisation over the next seven years including the procurement of 97 UAVs, 70 helicopters, Leopard II main battle tanks, Patriot missile defence system and the Homar multi-rocket launcher systems. The scale of this acquisition list is indeed exceptional among European allies.

Scandinavian nations are also investing in military capability in response to the Russian threat. Norway has increased its defence budget in order to purchase F-35 aircraft, and is partnering with Sweden, whose defence budget will increase by 1.1 per cent in real terms from 2015 to 2016, to buy multirole military vehicles over the next 10 years. The project will procure a total of 2,000 vehicles and is worth $2.7bn. Sweden is also building two A26 submarines, upgrading its anti-submarine capabilities and investing further in the Gripen programme. Moreover, it is  moving troops back to the island of Gotland.

These decisions present fundamental revisions of long-standing military spending practices in most of the countries that saw their defence budgets in more or less constant decline since the end of the Cold War. Although many of the uplifts come from a low base and most of the countries will still fall short of NATO’s 2 per cent of GDP target for defence spending, the recent developments might therefore be regarded as being indicative of a substantial change in the countries’ defence discourse both at the political level and within the broader public debate.

Britain’s 2 per cent Poisoned Chalice

Meanwhile, the UK (traditionally a leader in European defence matters) has remained silent on the matter. If anything, the continuing deficit means that the defence budget is likely to face further cuts. As a consequence, the UK government’s call to its fellow NATO members during last year’s summit in Wales to re-commit to NATO’s 2 per cent of GDP target for defence spending is looking increasingly foolish.

Of course, as credibly outlined by Claudia Major of the German think-tank, SWP: ‘the arbitrary correlation between GDP and defence spending sends absurd messages. [..] It does not care about output, or what countries get for their money, be it tanks or well-trained soldiers. Yet, what counts is what resources NATO ultimately has at its disposal, not how much its member states pour into their defense establishments.’

By that measure, the UK still has a lot to contribute. The UK Ministry of Defence spends £36bn or $55bn every year and it has not been shy in committing its forces. The UK’s operations have increased from around ten concurrent operations (including one ‘Main Effort’ operation in Afghanistan) to well over twenty across the globe.

These span small training teams of 2-3 personnel building capacity with partner nations through relief efforts in Nepal to NATO reassurance exercises across Europe and Operation Shader over Iraq.  In Europe, the UK has contributed to NATO reassurance exercises, Baltic Air Policing Mission and the current EU efforts to help save migrants from North Africa.

A UK defence budget of 2 per cent of GDP may not be achievable in the next parliament given the economic pressures but in terms of alliance solidarity, even a small increase in the UK’s defence spending along with commitments to specific capabilities (such as Scout AFV, ISR,  Maritime Patrol Aircraft and  the UK’s carrier strike package (both in terms of aircraft and Royal Navy personnel)) would add to the broader European message that defence – and more importantly collective defence - is being taken increasingly seriously across the continent.

See also: Video - The 2% Explained


Elizabeth Quintana

Associate Fellow

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