Prime Minister Andy Burnham is expected to postpone a decision on whether to increase the United Kingdom’s defence spending to 3 percent of GDP by 2030. The government had initially planned to outline the details of achieving this target at a comprehensive spending review scheduled for early 2027. However, the review is now likely to be delayed until late 2024 to coincide with the annual Budget.

The proposed delay comes amid ongoing uncertainty within the government over defence funding commitments. John Healey, who resigned as defence secretary in June, stepped down citing the government’s reluctance to commit to the 3 percent target by 2030. Healey argued that such an increase was necessary to safeguard Britain against potential threats from Russia to NATO within the coming decade. Since Burnham and Healey have been in office, neither has firmly committed to a clear plan for reaching this spending goal.

Alongside the 2030 target, Britain is also expected to meet a NATO guideline of allocating 3.5 percent of GDP to defence spending by 2035. Details on how the government intends to meet this longer-term commitment were also anticipated in next year’s spending review but now appear set to be delayed as well.

The news of a potential postponement had an immediate impact on defence-related equities. More than £2.8 billion was shed from the value of defence stocks on the London Stock Exchange. BAE Systems, a major defence contractor, experienced a decline of up to 2.5 percent, while Rolls-Royce shares fell by 1.1 percent.

Meanwhile, the Conservative opposition has called for urgent action to bolster the UK’s defence capabilities. Kemi Badenoch, the Conservative Party leader, unveiled plans for a homegrown equivalent to the Israeli Iron Dome missile defence system. Speaking on a national broadcast, Badenoch emphasized the need for the government to prioritize defence preparedness and criticized Burnham’s administration for its perceived lack of clear policy or funding commitments. “We need to start getting ready now,” she said, highlighting concerns over further delays.

The Treasury has refrained from confirming any changes to the timing of the spending review. A spokesperson described reports of a delay as “pure rumour and speculation.”

Burnham faces growing pressure to clarify how he intends to finance increased defence expenditure ahead of the upcoming Budget later this month. The government’s approach to defence spending remains a key focus amid evolving security challenges and expectations from both domestic and international stakeholders.