Rishi Sunak has pledged to increase Britain’s defence budget to 2.5 per cent of national wealth by 2030.

The Prime Minister unveiled the biggest uplift to military spending in a generation, which will add £23 billion to the military budget over the next six years.

Speaking during a trip to Poland, he challenged European countries to follow suit as he warned that the continent’s future security was at risk from Russia.

Mr Sunak said £10 billion would go on growing the domestic defence industry and boosting Britain’s stockpiles of weapons, including air defences.

He will nearly double annual spending on arms production, with a focus on hypersonic missiles, lasers, anti-tank rockets and artillery shells. A new Defence Innovation Agency, modelled on the US Defense Advanced Research Projects Agency, will be set up to develop weapons. 

Under the plan, Britain will spend £4.5 billion more on defence in 2028-29, with two-thirds of the cost set to be funded by cuts to the Civil Service.

Mr Sunak said: “In a world that is the most dangerous it has been since the end of the Cold War, we cannot be complacent. 

“As our adversaries align, we must do more to defend our country, our interests, and our values. That is why today I am announcing the biggest strengthening of our national defence for a generation. 

“We will increase defence spending to a new baseline of 2.5 per cent of GDP by 2030 – a plan that delivers an additional £75 billion for defence by the end of the decade and secures our place as by far the largest defence power in Europe.

 “Today is a turning point for European security and a landmark moment in the defence of the United Kingdom. It is a generational investment in British security and British prosperity, which makes us safer at home and stronger abroad.”

This year the UK is set to spend £64.6 billion on the military budget, which is just over 2.3 per cent of GDP. 

That figure will rise to £67.5 billion next year and £71 billion in 2026-27, before climbing more rapidly to a total of £87.1 billion in 2030-31.

Downing Street said the announcement set “a new standard” for other European countries. If all Nato countries increased their spending to 2.5 per cent, then the alliance’s collective budget would increase by more than £140 billion a year.

Jeremy Hunt, the Chancellor, said the move was possible because of the “improving economy” and represented the UK’s “commitment to peace and security in Europe”.

He said: “It also sends the clearest possible message to Putin that as other Nato European countries match this commitment, which they will, he will never be able to outspend countries that believe in freedom and democracy.” 

The spending increase is set to be directly funded by plans to cut the number of civil servants to pre-Brexit levels. Downing Street said cutting 70,000 Whitehall officials by 2028-29 would save £2.9 billion, covering two-thirds of the £4.5 billion uplift.

The remaining £1.6 billion would come from funds earmarked for research and development, ministers said.

The Prime Minister has faced months of pressure from Tory MPs including Grant Shapps, the Defence Secretary, to increase military spending to help counter the threat from Russia.

Last month, Mr Shapps, called for spending to increase to three per cent of GDP, saying: “I do believe that it’s a more dangerous world”.

Last week, senior Conservatives called for the Government to invest in a new “Iron Dome” air defence system to protect the UK against future rocket attacks. 

The Prime Minister announced on Tuesday that he was appointing General Gwyn Jenkins, the vice-chief of the defence staff, as his new national security adviser. Gen Jenkins will be the first person from a military background to hold the role and will replace Sir Tim Barrow, a diplomat who is moving to become ambassador to the US.

Last month, Mr Sunak faced calls from three former Tory defence secretaries to promise to increase defence spending to three per cent of GDP in his party’s election manifesto. It came after no new money was allocated to the Ministry of Defence in the Budget, despite the perilous situation in Ukraine.

Sir Michael Fallon, Sir Gavin Williamson and Ben Wallace, who together headed up the Ministry of Defence for almost a decade, argued that promising three per cent spending was essential for the Armed Forces.