However, it is not clear which element of the welfare budget might be singled out. Keir Starmer’s government was forced into a major climbdown last year after facing a revolt over plans to reduce the cost of disability benefits, and is currently attempting to draw up alternative reforms.
The investment plan is now effectively “on hold” until the Treasury finds new sources of revenue, two people working on the DIP said.
No. 10 Downing Street and the U.K. Treasury declined to comment.
The defense industry has been warning for months of the damage caused to businesses by the failure to publish the DIP, which was originally scheduled for last fall. Asked about it Monday, Defence Secretary John Healey failed to give assurances that the document would be published before the pre-election “purdah” period, meaning it would not come until May.
Separately, Starmer has stressed that the U.K. needs to go “faster” on overall defense spending, raising the expectation that Reeves will need to hunt for additional billions during this parliament.
John Bew, an academic and former adviser to several prime ministers including Starmer, wrote last week: “There is currently no route to higher defence spending — which is inevitable unless the nation is content to continue on a path towards greater insecurity and irrelevance — without major cuts elsewhere in the public spending stack.”
The PM and chancellor have both spoken of a wish to collaborate more closely with the EU on defense funding after the collapse of talks on British entry into the SAFE loan program, but details remain scant.