Fact check: Defence spending fell below 3 of GDP in the 1990s

At Prime Minister’s Questions on Wednesday 7 January, Opposition leader Kemi Badenoch said the last time UK defence spending was at 3% of GDP was under a Conservative government. It is correct that defence spending was last above 3% of GDP in 1994, during John Major’s Conservative administration. However, it is also the case that the same government presided over the subsequent fall below 3%, and the UK has not returned above that level since.

What the data show

• Defence spending was above 3% of GDP in 1994.
• It fell below 3% in 1995, while John Major was prime minister, and has remained below 3% ever since.
• Between the 1992 general election (when Mr Major won) and 1997 (when he left office), defence spending fell from about 3.9% to 2.6% of GDP.
• Looking further back: in 1979, defence spending was roughly 4.7% of GDP; by 1990 it was about 4.0%; by 1992, 3.9%; and by 1997, 2.6%.

In other words, whether you date that Conservative government’s record from 1979 (Thatcher takes office), 1990 (Major becomes prime minister), or 1992 (Major wins a general election), the share of GDP devoted to defence declined over the period and crossed below 3% in the mid‑1990s.

Real-terms changes

An independent fiscal analysis in 2001 found that the 1992–1997 Major government reduced defence spending by an average of about 3% per year in real terms (after inflation). Across the broader 1979–1997 Conservative period, the average real-terms change amounted to a small annual decrease of roughly 0.2%.

Why spending fell in the 1990s

The UK’s experience was part of a wider international trend following the end of the Cold War:

• Global defence outlays were about 3.5% of world GDP in 1979. By 1997, that share had fallen to around 2.3%.
• The drop is particularly stark comparing the mid-1980s (about 4.3% of world GDP in 1985) with roughly a decade later (around 2.4%).

Key geopolitical shifts drove these changes: the fall of the Berlin Wall in 1989, the rapid replacement of eastern Europe’s communist regimes with democratic governments by 1990, and the dissolution of the Soviet Union in 1991. In this context, NATO and member states, including the UK, redefined roles and force structures. In 1991, the British government announced a smaller Army as part of this strategic realignment.

How the claim stacks up

Ms Badenoch’s statement that the last time defence spending was at 3% of GDP was under a Conservative government is accurate. But a fuller picture shows that the same Conservative government also oversaw the drop below 3% in 1995, and the UK has not returned to that threshold since.

Bottom line

Yes: the last time UK defence spending exceeded 3% of GDP was in 1994 under a Conservative government. Yet by 1995—also under that government—it fell below 3% and remained there. The decline reflected both domestic policy choices and a broader post–Cold War reduction in defence burdens across advanced economies.