Brexit could reduce defence spending, says Parliamentary committee

10 July 2016 (Last Updated July 10th, 2016 18:30)

The Joint Committee on the National Security Strategy has announced that the UK's decision to withdraw from European Union (EU), also called Brexit, could see defence spending reduced in real terms.

The Joint Committee on the National Security Strategy has announced that the UK's decision to withdraw from European Union (EU), also called Brexit, could see defence spending reduced in real terms.

The committee in its report, National Security Strategy and Strategic Defence and Security Review (NSS & SDSR) 2015, revealed that the economic contraction caused by Brexit could limit the ability of the armed forces to carry out their role effectively.

According to the Institute for Fiscal Studies (IFS), despite the government's commitment to spend at least 2% of GDP on defence, the shrinking UK economy would result in a significant reduction of the defence budget.

"After Brexit, the nation's GDP could be reduced by between 2.1% and 3.5% in 2019."

After Brexit, the nation's GDP could be reduced by between 2.1% and 3.5% in 2019.

The reduction in GDP might have an impact on public finances of between £20bn and £40bn during the period between 2019 and 2020.

The report also highlighted that despite the government's commitment to maintain the size of the regular army at 82,000 and to increase the Royal Navy and Royal Air Force by a total of 700 regular personnel, the manpower fielded by the UK armed forces is inadequate.

In addition, the planned reduction in the number of MoD civilian staff could undermine the effective use of the equipment to be purchased as a result of the NSS & SDSR 2015.

The EU is facing security challenges, such as large-scale migration and an emerging domestic terrorist threat.

The UK is also at risk from such threats irrespective of whether it is a member of the EU.

A new security review has been recommended to address how the UK will engage with these issues from outside the EU.