I doubt it.
As has been said, the first duty of any Government is the safety and security of the British people at home and abroad. I am proud that the Government have delivered on their NATO pledge to spend at least 2% of GDP on defence. They will be spending more than £186 billion on equipment and equipment support between 2018 and 2028. Aside from ensuring that our armed forces have the latest and best capability, our investment of around £19 billion a year underpins a world- class British industry, providing direct employment for 115,000 people and nearly 400,000 more across the wider supply chains. That substantial and sustained investment is not only vital to our national capability and prosperity and to supporting economic growth. It is also vital to our ability to counter the rising threats that menace us and all NATO members, including a resurgent and increasingly assertive Russia, and extremist terrorism across the world.
This year NATO celebrates 70 years as the foundation of our mutual security. The UK is one of very few NATO members that meet both their core spending guidelines by spending 2% of GDP on defence, of which 20% goes on major equipment and associated research and development. Defence spending in many NATO states is still too low, and although our allies are making progress on burden sharing, they must do more. The increase mirrors rising defence spending across the world, which makes it vital that the UK maintains its position as a leading player on the world stage.
The upcoming spending review is an opportunity to reprioritise our national investments across defence, ensuring that we can meet whatever the future may throw at us in an era of intensifying threats. The Department has done a great deal to drive out inefficiencies in defence, and there is more to be done, but we must also invest in new capabilities and in transforming the way defence operates, so that we can continue to defend the UK and project our influence.
First, we must mobilise defence to meet rising threats. The international situation is darkening. The rules-based order that has kept the peace for so long is under constant pressure and the external threats that confront us increasingly come from multiple directions. Despite the coalition’s success in degrading the power of Daesh, the threat of terrorism is still with us, while malign cyber-warfare and proxy warfare are rapidly changing the face of conflict. The nation’s approach to future spending decisions must reflect those new realities.
Secondly, we have to modernise and innovate—to embrace new technologies to ensure we have a competitive edge over our adversaries and to identify opportunities to sustainably reduce our cost base, which will require some up-front investment. The Department is investing about £800 million through the defence innovation fund to keep us ahead of the curve, and ring-fencing £160 million of its budget this year for the new transformation fund. Thirdly, on efficiencies, defence has to transform the way it does business by liberating new industry thinking and tackling the behaviours and practices that have racked up excessive costs in the past. That means tackling the mindset of short-term decision making that leads to poor value for money. We must invest in technology now for long-term savings.
I want to answer a couple of points raised in the debate. The MOD does not collate defence expenditure figures for regions, but the average spend per person in the UK was £290 in 2017-18, and the MOD spends some £19 billion a year supporting 115,000 jobs. That means that one in every 220 jobs in the UK is in defence. On the accusation that there have been cuts under the present Government, since 2014 defence spending has increased year on year and we now spend £39 billion—rising to £40 billion by 2020. [Interruption.] I would also say to Mr Jones, having served in Afghanistan in 2006, that the sort of commitment that we had, with so many of our troops serving on operations overseas in Iraq and Afghanistan, made for an environment very different from today’s. With the different threats we face at any one time, it is sometimes difficult to compare like with like. Our relationship with strategic suppliers in the UK defence and security sector is vital. The armed forces support an industrial base in the UK providing employment to about half a million people.
I was delighted that many Members raised the issue of mental health in the debate. In the autumn Budget the Chancellor announced £10 million to support veterans’ mental health and wellbeing needs, and in January the armed forces covenant fund opened a £3 million funding programme to fund innovations and improvements to veterans’ community centres. We are considering investing more in veterans’ mental health. Accommodation is another key issue for many service personnel. We are looking closely at the new accommodation model, which is aimed at giving choice to service personnel. Equally, on pay, the Armed Forces Pay Review Body has recently presented its latest findings, to which the Government will respond in due course.
I end on a note of consensus again. I am delighted that in this Chamber at least we are committed to armed forces personnel, and to a rising defence budget.