The Germans are funding increased defence spending through debt so why can’t we? The Chancellor needs to start telling a better story about the future direction of our economy, says Paul Ormerod

President Trump wants European countries to spend five per cent of GDP on defence. Kier Starmer plans to increase UK spending from 2.3 to 2.5 per cent.

The proposal of the Prime Minister involves what is, in the context of the overall state budget, a trivial amount of money. Public spending is around £1,200bn a year, and the extra defence monies are under £6bn, more or less a rounding error.

A commitment to the five per cent Trump target involves serious money. An additional £70bn a year spent on defence is necessary in order to achieve it.

Last week, German political parties struck a deal to allow an extra €100bn a year to be spent on defence and infrastructure over the next decade. Crucially, given the restrictions on debt embodied in the German constitution, defence spending........

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