Broken Promises: Labour’s tax pledges have to go

Raunaq Mohammad

3rd March 2025

Written by Raunaq Mohammad

The government is set to increase defence spending from 2.33% of GDP to 2.5%. Keir Starmer as it stands has been rejecting calls from defence chiefs to increase spending to 2.65%.

To fund 2.5%, this currently costs and additional £5bn-£6bn a year showcasing the huge cost associated with this visually small percentages.

The UK now faces the most dangerous and difficult situation in its own theatre since the Cold War with a US president who is far different from any of the presidents that the UK has worked with from 1966 to 1990.

It is interesting to think whether it is truly possible for the UK to meet its defence needs in 2020s without increasing spending back to the level it was from 1966 to 1990.

Obviously, increasing defence capacity for the entire nation is not something that can be done overnight and although it would be nice, it is not logical to say the UK should go from 2.3% of GDP to 4% or 5% tomorrow, but it is clear that there needs to be some sort of increase.

It is worth asking whether we really think that the British electorate would put up with that level of increase in defence spending. While at the same time, being asked to tolerate a worse standard of public services than those it felt was inadequate at the time of the 2024 general election.

The constrain here is Labour’s pledges on tax: promises the party made in opposition and must keep in order to be re-elected. At some point however, the government has to choose between whether it wants to meet any of the objectives it set for itself at the election or to meet the challenges that have been thrust upon it in office.

In general, the politics tends to catch up with the policy sooner or later and eventually the government is going to have to abandon its commitments on tax if it wants to meet that urgent policy provided that it has itself identified on defence.

The biggest worry and concern here for the British public is how long and painful this journey will turn out to be in the long run.