Nato confirms UK is meeting defence spending targets

The announcement came amid a furious row over a think tank’s claim – firmly rejected by the Ministry of Defence – that UK spending dipped below the politically sensitive threshold last year.

The International Institute for Strategic Studies (ISS) put last year’s figure at 1.98 per cent, a level that would marginally breach the Government’s commitment to meet the Nato target.

But speaking in Brussels, the alliance’s secretary general Jens Stoltenberg unveiled figures showing that European members and Canada had between them increased defence spending by 3.8 per cent above inflation last year.

Mr Stoltenberg said the figures were “significantly higher than what we had originally foreseen” and showed Nato had “turned a corner” after many years of steep cuts in spending.

A national breakdown is not due to be released until later in the year, but based on the new data, a Nato official said: “According to our calculations, five allies, including the United Kingdom, currently meet or exceed Nato’s 2 per cent spending benchmark for 2016.”

The 1.98 per cent figure was contained in the IISS annual Military Balance report, unveiled a day before a meeting of Nato defence ministers, including the UK’s Sir Michael Fallon, in Brussels.

IISS director-general John Chipman said: “In 2016, only two European Nato states – Greece and Estonia – met the aim to spend 2 per cent of their GDP on defence, down from four European states that met this measure in 2015.

“The UK dipped slightly below this at 1.98 per cent, as its economy grew faster in 2016 than its defence spending.”

The think tank calculated that Britain fell short by around £380 million (500 million US dollars) in 2016, out of a budget recorded as £39.8 billion by Nato and £36.9 billion by the United Nations.

But the MoD branded the figures “wrong”, pointing to official Nato statistics from last July which put the UK’s defence spending for 2016 at 2.21 per cent of GDP.

A spokesman said: “These figures are wrong: Nato’s own figures clearly show that the UK spends over 2 per cent of its GDP on defence.”