A Cabinet minister dramatically quit today over Keir Starmer slashing the aid the budget to boost defence spending.
Development minister Anneliese Dodds has resigned warning that the reduction will only increase the influence of Russia and China.
Swiping that Sir Keir seemed to be appeasing Donald Trump, she suggested taxes will need to rise anyway as the new military demands cannot be met by ‘tactical’ reductions to spending.
The move will fuel widespread anxiety on Labour benches about the decision, amid claims that Sir Keir ‘bounced’ his top team into it.
In a Commons statement before he headed to the US, Sir Keir revealed that defence spending will be hiked to 2.5 per cent of GDP by 2027 – adding an extra £6billion a year in real terms.
He said that would be funded by reducing the aid budget from 0.5 per cent of gross national income to 0.3 per cent. It had already been lowered from 0.7 per cent by the Tories, with no timetable for returning.
The announcement was seen as a pitch to Mr Trump ahead of Sir Keir’s crucial visit to the White House. Ms Dodds said she waited to confirm her departure until after the trip was complete.
The US president has been urging NATO states to spend 5 per cent of GDP on defence as he insists Washington will no longer underwrite protection for Ukraine or Europe.
Mr Trump praised the spending bump as a ‘great thing to do’ at a joint press conference last night.
Tory leader Kemi Badenoch swiped this afternoon that she would support the PM’s choice, even if he could not persuade his own ministers.
Ms Dodds – a former shadow chancellor and party chair who attended Cabinet in her most recent role – was previously seen as a close ally of Sir Keir.
However, she wrote in her letter to the premier that taxes should rise instead of deep cuts to aid.
‘Undoubtedly the postwar global order has come crashing down. I believe that we must increase spending on defence as a result; and know that there are no easy paths to doing so,’ she said.
‘I stood ready to work with you to deliver that increased spending, knowing some might well have had to come from overseas development assistance [ODA].
‘I also expected we would collectively discuss our fiscal rules and approach to taxation, as other nations are doing.
‘Even 3 per cent may only be the start, and it will be impossible to raise the substantial resources needed just through tactical cuts to public spending.
‘These are unprecedented times, when strategic decisions for the sake of our country’s security cannot be ducked.
‘Instead, the tactical decision was taken for ODA to absorb the entire burden.’
Ms Dodds said Sir Keir was clear he wanted to ‘continue support for Gaza, Sudan and Ukraine; for vaccination; for climate; and for rules-based systems’.
‘Yet it will be impossible to maintain these priorities given the depth of the cut; the effect will be far greater than presented, even if assumptions made about reducing asylum costs hold true,’ she added.
‘The cut will also likely lead to a UK pull-out from numerous African, Caribbean and Western Balkan nations — at a time when Russia has been aggressively increasing its global presence.
‘It will likely lead to withdrawal from regional banks and a reduced commitment to the World Bank; the UK being shut out of numerous multilateral bodies; and a reduced voice for the UK in the G7, G20 and in climate negotiations.
‘All this while China is seeking to rewrite global rules, and when the climate crisis is the biggest security threat of them all.’
Responding to the resignation, a No10 spokesman said: ‘The reality we face is that all of our spending must be laser focused on generating the maximum impact for national security and growth.
‘We are not pulling away, it is not a decision taken lightly.’
Defence Secretary John Healey suffered a bruising encounter with Labour MPs earlier this week as he attempted to defend the Government’s foreign aid cuts.
In a private meeting in Parliament, Mr Healey came under fire from a group of a dozen Labour MPs – mostly with backgrounds in development.
Mr Healey sought to reassure them that the Government would not halt spending programmes ‘abruptly’.
There were claims of Cabinet unrest at being presented with a fait accompli by Sir Keir during weekly meeting on Tuesday.
Alongside Ms Dodds, Net Zero Secretary Ed Miliband was said to have raised concerns.
Deputy PM Angela Rayner said the cut was ‘devastating’, but played down splits saying the government was united on the need to bolster national security and have a ‘balanced budget.’
The Prime Minister, who is visiting US President Donald Trump in the White House later today, has pledged an increase in military spending to combat Russia’s threat.
Ms Badenoch said she would support Sir Keir on cutting aid to boost defence.
‘I disagree with the PM on many things BUT on reducing the foreign aid budget to fund UK defence?’ she said.
‘He’s absolutely right. He may not be able to convince the ministers in his own cabinet, but on this subject, I will back him.
‘National interest always comes first.