Burnham faces a £4.7bn defence gap as Starmer’s military pledge sparks fury

Andy Burnham is set to inherit a £4.7bn funding gap in his first budget after Keir Starmer unveiled a £298bn defence investment plan without fully setting out where all the money will come from.

The outgoing prime minister announced the long-delayed programme on Tuesday, presenting it as a major reset for Britain’s armed forces. He said the plan would make the country safer, rebuild readiness, restore ammunition stockpiles and prepare the military to fight and win if required.

But behind the show of resolve, a difficult bill remains. Sources close to Burnham said the Makerfield MP would not try to reopen the defence investment plan, even though allies accept he must find almost £5bn more than expected over the next four years. One ally compared the funding gap to an unexploded bomb.

Burnham was not told about the missing £4.7bn when he was briefed on the plan, according to people familiar with the matter. A defence insider called it madness to leave such a black hole for someone else to solve, while the Conservatives labelled the package a delayed-action poison pill for the likely next prime minister.

Starmer said the defence investment plan would drive a generational transformation of the armed forces. Overall defence spending is due to rise from 2.6% of GDP in 2027 to 2.7%, close to £80bn, by 2030. He said that would put the UK on course to reach 3% in the next parliament, although it still sits below Nato’s 3.5% target for 2035.

The package places nuclear capability, drones and fighter aircraft at the centre of Britain’s military future. It includes £47bn for new nuclear submarines, covering the Dreadnought replacement for Trident and the Aukus attack submarine project with Australia and the US.

It also sets aside £13bn for a new nuclear warhead and £1.7bn for nuclear fuels. A further commitment to spend £1bn on 12 Lockheed Martin F-35A jets capable of carrying nuclear bombs would come after 2030.

The defence investment plan also includes £8.6bn for the Gcap next-generation fighter aircraft being developed with Italy and Japan, plus £1.1bn to keep Typhoons flying into the 2040s. Drones receive another £5bn, covering air, land, sea and underwater systems designed to operate alongside troops, warships and fighter jets.

Ministers intend to fund part of the programme through £10.7bn in Ministry of Defence efficiency savings. Those savings include cutting civil servants by 10%, reducing consultant spending by £1bn and retiring some military capabilities early. The army’s 34 Wildcat helicopters would go, and Storm Shadow missile development would stop.

Other departments will also feel the squeeze. The plan draws £4bn from a 1% cut to capital budgets across Whitehall, £1.1bn from government asset sales and £2.8bn from further reductions to road and energy projects. Hamish Falconer, a Foreign Office minister, has already objected to the possible cancellation of work to widen the Newark bypass near his Lincoln constituency.

The energy department has not yet identified which projects will be squeezed to deliver £2bn of savings from its budget.

The Treasury says £4.7bn still needs to be allocated at the next budget, including £1.8bn in the next financial year. A Treasury source argued that chancellors often leave some money to be settled at a later fiscal event.

Starmer warned against using defence bonds, calling them borrowing by another name. Critics still say the defence investment plan lacks certainty. John Healey, who resigned as defence secretary over the funding offer, said Britain would still spend only 2.7% of GDP in 2030, while Labour defence committee chair Tan Dhesi said the defence investment plan lacked detail on operational risks.