Funding defence by decimating development is a strategic mistake and moral failure

Monica Harding (Credit: Parliament UK)

They relied on American hyperpower and a belief that full-scale wars in Europe were a thing of the past. This continued for far too long – the last Conservative administration, for example, presided over a cut of 10,000 troops from our forces.

With Putin’s brutal invasion of Ukraine and the radical change in American policy since the return of Donald Trump, however, all previous assumptions and status quo thinking has been upended. The UK must ready itself to meet the threats of a rapidly changing world.

The government is therefore right to raise defence spending to 2.5 per cent of GDP with a view to moving towards 3 per cent, and right to lay out steps to reform procurement and deliver value for money. However, the government’s decision to fund defence by decimating development is a strategic mistake and a moral failure.

The choice between defence and development is a false economy

Our development work serves vital British interests. It is one of the ‘Ds’ of our foreign policy: defence, diplomacy and development. Each supports the other; and without any, the other legs of the stool are weaker. 

Through international aid and development, we invest in resilience-building and deconfliction measures across the world, because we know that preventing wars is cheaper than fighting them.

We also protect our borders, because when conflicts escalate – even far away from Britain – it can displace and disperse people who often end up on our shores. In 2024, the UNHCR recorded over 40 million refugees around the globe. That same year, at least 2,000 people from Sudan, where the world’s largest humanitarian catastrophe is currently unfolding, arrived in the UK via small boats, an increase of 16 per cent on the previous year. Put simply, international development spending is our investment in a more stable world.

Development also promotes growth. Being a global leader in international development has given us influence in the world. The cut to 0.5 per cent from the 0.7 per cent enshrined in law in 2015 threatened this influence.  We all looked forward to the new government’s stated ‘reset’ of Britain on the world stage – and the commitment to ‘soft’ power to build back our influence and forge the partnerships which lay the groundwork for future trading relationships with the UK.  That promise has come undone.

And when we retreat, Russia and China advance. China is already moving rapidly to fill the gap left by USAID – in the Indo-Pacific, in South-East Asia, in Africa, and elsewhere. Doubtless, the Prime Minister’s decision will afford Beijing further opportunities to amass soft power at our expense.

When previous cuts to the BBC World Service forced a reduction in radio broadcasts to Lebanon and the Occupied Palestinian Territories, the same frequencies that once carried impartial British journalism were co-opted by Sputnik – Russian state radio – and used as an authoritarian state’s mouthpiece.

The Liberal Democrats were the first British political party to commit to spend 0.7 per cent of GNI on international development, now more than half a century ago. This bold view gathered momentum and support. Between 1997 and 2010, the Labour governments more than doubled development spending as a percentage of GNI; this new government has made the decision to halve it.

I am not alone in being surprised at the incoherence of Labour values, as shown by this new Labour government cutting international aid more harshly than any other government this century. It is a sad inheritance from the 1997 Blair government that aimed to “make poverty history”. Even the austerity chancellor George Osborne chose to protect the world’s poorest in his budgets, knowing that in doing so he protected British interests too.

And so, from 1990 to 2019, billions were lifted from poverty, and global extreme poverty steadily declined from almost 40 per cent of the world’s population to below 10 per cent. Since the pandemic, this trend has reversed. Much of the remarkable progress made in recent decades is presently imperilled by rising global tensions and spiralling regional conflicts.

Additionally, the vicious attack on USAID by President Trump and Elon Musk, which gutted an agency responsible for more than $40bn in development spending, has thrown global humanitarian relief into crisis. Amid reports that the USAID freeze has forced 80 per cent of emergency food kitchens in Sudan to close their doors and left $489m in nutrition assistance to rot in ports and warehouses, I had hoped Britain would step into the breach and reject this Trumpian politics. I was disappointed.

The choice between defence and development is a false economy. To cut a crucial pillar of our global influence and national security in the name of our global influence and our national security is an incoherence.

While there is wide recognition and welcome consensus across the House that defence spending must rise, there are different funding choices available.

The Prime Minister should consider the Liberal Democrat proposals to raise billions through an increase from 2 per cent to 10 per cent in the Digital Services Tax. He must explore the construction of a European Rearmament Bank to mobilise private finance quickly and at scale, in service of our collective defence. And finally, the Prime Minister should look at options to deploy the £40bn in frozen Russian assets – not just their profits – against Russian aggression. 

Instead the Prime Minister has made the easiest choice, a morally shameful one and a strategically unwise one. 

Monica Harding, Liberal Democrat spokesperson for International Development

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