A New Direction for the Ministry of Defence’s Budget? Implications of the November Spending Review

Taking full advantage of the government’s decision to award the MoD a multi-year spending settlement will not be easy. The government has chosen to devote the additional £24 billion for defence almost entirely to increasing defence investment, while simultaneously reducing real-terms running costs. It will therefore have to make difficult decisions on where to reduce day-to-day spending: a process made politically harder by the perception that the Spending Review now allows the MoD to embark on a ‘spending spree’. Until the full results of the Integrated Review are known, it remains unclear whether the MoD will be allowed to make these decisions. If not, it is still possible that the curse of budgetary overcommitment, which has overshadowed UK defence planning for the last decade and more, will remain alive and well.