UK defence spending is set to rise to 2.5% of GDP by 2027, with a long-term goal of 3%, as announced by Prime Minister Keir Starmer. To fund this increase, the government will cut the foreign aid budget from 0.5% to 0.3% of GDP. This move aligns with NATO commitments and follows pressure from US President Donald Trump for European nations to boost military funding. The decision marks the largest sustained defence investment since the Cold War, as the UK aims to strengthen its military capabilities while balancing economic priorities.