Keir Starmer has declined to confirm whether money spent on the Chagos Islands deal will be included in the rise in defence spending.
The UK is in talks with Mauritius about handing over sovereignty of the British Indian Ocean Territory but leasing back the strategic Diego Garcia military base, which the US uses.
The Prime Minister yesterday announced he would bring forward a rise in Britain spending 2.5 per cent of GDP – up from 2.3 per cent – by 2027, funded by cutting the international aid budget, and would aim for a new target of three per cent within the next Parliament.
Sir Keir made the move just days ahead of his first visit to US President Donald Trump, amid increasing international uncertainty over the future of the conflict in Ukraine, and America’s role in European and NATO security infrastructure.
But he was quickly challenged over a claim that this amounted to £13.4bn more being spent on defence next year, after economists at the Institute for Fiscal Studies (IFS) said this was a “misleadingly large figure” and implied the defence budget would have been frozen in cash.
“An extra 0.2 per cent of GDP is around £6bn, and this is the size of the cut to the aid budget,” the IFS’s Ben Zaranko said.
And at Prime Minister’s Questions (PMQs) in the House of Commons on Wednesday, Starmer was challenged by the Conservative Party leader Kemi Badenoch over the £13.4bn defence spending claim.
She asked: “He announced £13.4bn in additional defence spending yesterday. This morning his defence secretary said the uplift is only £6bn – which is the correct figure?”
And Starmer insisted: “If you take the numbers for this financial year and then the numbers for the financial year 2027-28, that’s a £13.4bn increase.
“That is the largest sustained increase in defence spending since the Cold War, which will put us in a position to ensure the security and defence of our country and of Europe.”
The opposition leader also asked Starmer: “This morning the defence secretary could not say if the Chagos deal would come out of the defence budget.
“Can he confirm to the House that none of the defence uplift includes payments for his Chagos deal?”
Earlier on Wednesday, defence secretary John Healey did not say whether the Chagos money was included when asked by Times Radio, instead insisting the money was “about our mainstream defence budget” and that the Chagos deal was still “in the pipeline”.
Starmer responded: “The additional spend I announced yesterday is for our capability on defence and security in Europe, as I made absolutely clear yesterday.
“The Chagos deal is extremely important for our security, for US security. The US are rightly looking at it. When it’s finalised I’ll put it before the House with the costings.
“The figures being bandied around are absolutely wide of the mark, the deal is well over a century but the funding I announced yesterday is for our capability to put ourselves in a position to rise to a generational challenge, that is what that money is all about and I thought she supported it.”
Following PMQs, Badenoch’s spokesman said: “I think this all points to what amounts to really a cover-up of where this money for the Chagos surrender is coming from.
“It is incumbent on the government as soon as possible to come and explain where the money is coming from, and if it is coming from the defence budget it makes all of the announcements over the last 24 hours seem (to be) ringing increasingly hollow.”