Core Defence at 3.5% of GDP by 2035: Trade-offs, Costs and How to Deliver
Published 16.09.2025
The headline ambition is crisp, the execution far less so. The government wants core defence spending to reach around 3.5% of gross domestic product by 2035. On the surface, that sounds like a simple matter of turning a dial in the budget. In practice, it is a decade-long programme stitched together from thousands of decisions across procurement, workforce, industry capacity and public finance. The aim is to strengthen the armed forces and the systems that support them while living within constrained fiscal headroom. Understanding what “core defence” actually includes, how the timeline interacts with the rest of the state, and what must change in delivery culture is the difference between a workable plan and an expensive promise.
Core defence refers to the narrow heart of national defence: the single-services and joint commands, the equipment plan that buys and sustains platforms, the munitions and stockpiles that underpin readiness, the estate and digital backbone that allow forces to train and operate, and the people who make those systems work. It is distinct from the parallel category of “security and resilience,” which covers wider cross-government investments such as cyber capacity, critical infrastructure protection and supply-chain hardening. The separation matters because each strand is funded and delivered in different ways. The resilience element will often be woven into departmental plans that were already set at the Spending Review, whereas the climb to 3.5% for core defence implies larger, dedicated uplifts later in the decade. Keeping the boundary clear avoids the familiar problem of rebadging existing spending while the front-line capabilities that voters and allies expect fail to materialise.
A target this large cannot be met evenly year by year. The path to 2035 will be lumpy because big programmes come in waves. Long-lead items in the maritime and air domains, replenishment and scaling of complex munitions, the integration of crewed and uncrewed systems, and modernisation of the digital backbone all carry different timelines and risk profiles. Sensible sequencing spreads peaks, protects critical skills pipelines, and prevents the entire equipment plan from bunching in the same two or three years. The temptation to announce everything at once is powerful; the discipline to phase approvals and funding tranches is what keeps the plan deliverable.
The fiscal arithmetic is tight even before you add new ambitions. The latest spending framework protects the National Health Service and sets expectations for other priority areas, while unprotected departments are expected to generate administrative savings to shield frontline services. A larger defence trajectory must therefore coexist with crowded priorities. If nominal growth is steady, debt-interest pressures ease and wage settlements across the public sector are moderate, the state can pursue the defence path without rupturing the wider plan. If any of those variables move the wrong way, choices sharpen quickly: defer elements of the ramp-up, reallocate from other programmes, stretch delivery timelines, or raise more revenue. None is a free option. That is why delivery discipline—doing fewer things faster and better, with fewer surprises—matters as much as the cash totals.
Procurement reform is not a supporting character in this story; it is the plot. For core defence to rise to 3.5% of GDP and buy real capability rather than delay and rework, the incentives inside the acquisition system must change. Over-specification that chases perfection, fragmented accountability that blurs responsibility, and commercial models that push risk onto contractors without equipping the Ministry to manage its side of the bargain all produce the same outcome: late, costly platforms that starve other lines of effort. A different approach starts with ruthless clarity at the business-case stage about what the capability must do and what it will not do, an honest schedule that reflects industrial capacity, and funding profiles that match reality rather than wishful thinking. It also means treating software, test, evaluation and certification as first-order capabilities rather than afterthoughts. In a world where many advantages are software-defined, the ability to iterate safely and quickly is not optional.
Industrial capacity is the other pillar that turns budget lines into kit in the hands of service personnel. The UK will need deeper resilience in complex munitions and their components, predictable work in maritime build and sustainment, integration across manned and unmanned air systems, and a stronger position in space-based services that are now central to command, control and precision. None of that is built on press releases. It rests on early, credible order books that justify investment, on export frameworks that protect sensitive technology while opening markets, and on security and compliance processes that are rigorous without being suffocating. The state must decide openly where it seeks sovereign capability, where it is comfortable as a trusted buyer in allied supply chains, and where genuine joint programmes create more value than going it alone. Those choices reduce risk and cost by narrowing the field of the possible to what is strategically necessary and economically sensible.
A plan of this scope fails or succeeds with people. Raising core defence to 3.5% of GDP will mean little if the system cannot attract and retain the engineers, programme managers, cyber specialists, logisticians, aviators, submariners and test professionals required to deliver it. Money helps, but it is not enough. Career structures must match how skilled workers actually live and plan families in the twenty-first century. Lateral entry routes should be normal rather than exotic. Reserve models have to reflect flexible careers rather than a narrow view of service. On the industrial side, small and medium-sized innovators need a path to meaningful work without drowning in process, and primes need stable pipelines that justify expanding apprenticeships and training. Skills policy is usually treated as an annex to defence; in reality, it is the engine.
Governance sounds dry, yet it is the cheapest way to buy value. A credible path to 3.5% requires clear accountability for portfolios, independent challenge before and after approval, and reporting that exposes reality rather than coats it in gloss. When programmes slip, the system must surface the problem early, adjust the plan and explain the trade-offs in public. That culture of candour builds trust, which in turn buys political space for long-term investment. Without it, a higher budget invites cynicism and becomes harder, not easier, to defend.
The politics of trade-offs cannot be wished away. Protecting the NHS while funding a defence ramp-up means unprotected departments will feel real-terms pressure unless the economy delivers strong nominal gains. That is not a counsel of despair. It is a reminder that long-term defence ambition is tied to a broader growth and productivity story. Planning reform that unlocks investment, export performance that deepens order books, and digital transformation that makes public services cheaper to run are not distractions; they are how the state pays for strategic choices. A defence plan that is integrated with an industrial strategy and a growth strategy is sturdier than one that lives only in a budget annex.
Households and businesses will ask what any of this means for them. The honest answer is that the benefits show up both directly and indirectly. Directly, a more resilient defence ecosystem sustains skilled jobs in shipyards, factories, laboratories and software houses across the country. It creates apprenticeship ladders that matter in towns where opportunity is uneven. It supports export earnings in high-value sectors. Indirectly, credible defence and resilience investments reduce the frequency and severity of shocks—cyber outages that cripple hospitals, supply bottlenecks that push up prices, infrastructure failures that strand commuters and freight. The return is not only measured in military terms; it is measured in steadier daily life and lower long-run costs for the state.
None of this negates the risks. Global energy prices can jump and keep inflation sticky, complicating the fiscal picture. Interest rates can take longer than hoped to settle into a comfortable range, raising the cost of servicing debt and shrinking the room for manoeuvre. Labour markets can tighten in precisely the specialist roles the plan depends on, pushing up wage bills and forcing delays. The housing market can ebb in ways that dent consumer confidence and tax receipts. These shocks do not invalidate the goal. They do demand sequencing and portfolio management that can absorb turbulence without flipping the table. That is why early wins matter: small, well-chosen programmes delivered on time and on budget create confidence and momentum for the larger waves to come.
There are also tailwinds that make the path easier. If inflation keeps gliding down and nominal growth holds up, debt-interest costs will ease while receipts grow, quietly expanding headroom. If procurement reform shortens delivery cycles and weeds out slow-burn failures, more value is delivered from each pound. If industry sees credible pipelines, it will invest ahead of need in people and plant, reducing later bottlenecks. And if collaboration with allies continues to deepen, shared development and production can lower unit costs and spread risk, particularly in space, cyber and complex munitions.
The next two years will tell readers whether the 2035 target is turning into reality. The signs to watch are simple, even if the underlying systems are not. Watch whether approvals are paced instead of bunched, so the equipment plan looks like a portfolio rather than a pile-up. Watch whether enabling infrastructure—test ranges, secure digital platforms, logistics nodes—gets funded early, because it is the difference between glossy plans and working capability. Watch whether recruitment and retention move in the right direction in critical trades, since money without people is paper strength. Watch whether resilience projects are defined in plain language with measurable outcomes, not vague labels that invite rebadging. And watch how candid ministers and officials are about setbacks, because openness is the best indicator that the system is learning and adapting.
By 2035, if the plan is executed well, core defence at 3.5% of GDP should mean more than a larger budget line. It should mean forces that are better equipped, stocked and trained for the threats they actually face. It should mean a defence-industrial base that can surge when required and compete globally in peacetime. It should mean a state whose essential systems—digital, energy, transport, health—are less fragile and faster to recover. Those outcomes justify the ambition. They also justify the insistence on discipline along the way, because in public spending, delivery is destiny.
The United Kingdom has set a clear course: protect what must be protected, invest in the capabilities that underwrite national security, and do so in a way that commands public trust. Raising core defence to 3.5% of GDP by 2035 is not a slogan; it is a demanding test of whether the country can plan, buy and build with focus. The difference between success and drift is not a mystery. It lies in patient sequencing, honest governance, resilient industry and the skills to make it all work. If those pieces come together, the target will read not like a boast, but like a brief description of the defence the country already has.
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