Chancellor John Healey delivered his Growth Speech on September 7, 2026, which included details of the UK's Defence Investment Plan (DIP). This plan outlines a substantial investment in the Royal Navy, focusing on the development of at least six new modern "hybrid" vessels equipped to deploy drones. This initiative replaces earlier plans to procure Type 83 destroyers and Type 32 frigates, instead opting for Common Combat Vessels designed for coordinating uncrewed systems across air, surface, and underwater domains.
The DIP commits to significant defense spending over the next four financial years: $35.3 billion in FY26/27, $31.2 billion in FY27/28, $32.7 billion in FY28/29, and $34.5 billion in FY29/30, totaling $125 billion. Key areas of investment include $63.6 billion for the Defence Nuclear Enterprise, $18.0 billion for naval capabilities, and $11.1 billion for weapons and munitions, including long-range strike weapons and low-cost cruise missiles. A notable $1.5 billion is allocated to a Hybrid Navy fleet, which will include uncrewed missile, sensor, and undersea platforms. Another $1.5 billion is designated for Atlantic Bastion to rebuild anti-submarine warfare capacity in the North Atlantic.
This plan comes despite the recent resignation of John Healey as Defence Secretary on June 12, 2026, and Al Carns as Armed Forces Minister, due to disagreements over the adequacy of funding for the DIP. Healey stated that the Treasury's financial settlement "falls well short of what is required" to meet the UK's defense needs, particularly for the initial two years after 2026. He expressed concern that the plan's proposed spending would only reach 2.68% of GDP by 2030, contrary to his advocacy for a 3% target by that year and the agreed 3.5% NATO commitment by 2035. However, the announced DIP, while representing an additional $15 billion in spending power, did not significantly alter the funding levels that prompted Healey's resignation.
