Former defence secretary John Healey was privately pushing for the UK to join an international investment bank to raise more money for defence spending, BBC News has been told.<\/p>\n
Allies of Healey claim the Treasury tried to shut down negotiations for the UK to join the Defence, Security and Resilience Bank (DSRB), an idea spearheaded by Canada.<\/p>\n
In his resignation letter Healey said there were “credible ways” to fund extra defence spending, including “working multi-nationally”.<\/p>\n
Treasury sources indicated to the BBC the chancellor had been looking at ways to fund defence with countries aside from the Canadian suggestion, including discussions with Poland about a “Multi-Lateral Defence Mechanism”.<\/p>\n
The DSRB, which aims to help member countries fund defence projects at low costs, is expected to be officially launched at a Nato summit next month.<\/p>\n
Countries wishing to join will be asked to contribute an upfront investment of around \u00a3870m.<\/p>\n
Canadian prime minister Mark Carney, who has been pushing the idea on the global stage, is said to be keen for the UK to join the project.<\/p>\n
Ministers have been mulling it for months but the chancellor is thought to have been unwilling to pay.<\/p>\n
Healey resigned as defence secretary on Wednesday, saying the amount of money attached to the government’s upcoming Defence Investment Plan fell “well short” of what was needed.<\/p>\n
Sir Keir Starmer told the BBC on Friday he had made “hard-edged” choices on defence spending, including asking government departments to make cuts to help pay for it. The Defence Investment Plan has yet to be announced.<\/p>\n
Healey said Number 10 and the Treasury were prepared to give around \u00a310bn in additional money in this plan, around \u00a318bn less than what military chiefs have reportedly asked for.<\/p>\n
It is understood Healey believed joining the DSRB could have helped bridge a funding gap as well as supporting British businesses in the defence sector.<\/p>\n
A group of defence-focused Labour MPs have been lobbying ministers to look more closely at the DSRB for months.<\/p>\n
One advocate of the UK joining the bank said it was likely that the up-front cost would have to be paid for by borrowing.<\/p>\n
Earlier this week Chancellor Rachel Reeves indicated she was not in favour of borrowing more money to increase defence spending.<\/p>\n
The Canadian High Commissioner to the UK told Politico Gordon Brown, who is advising the prime minister on global finance, has held direct talks with Carney about the DSRB.<\/p>\n
Supporters hope it will lead to direct low-cost lending to governments as well as credit guarantees for commercial banks that give loans to defence companies.<\/p>\n
But some in Whitehall have raised concerns the model being offered would be more likely to benefit smaller economies with lower credit ratings.<\/p>\n
The Treasury has been contacted for comment.<\/p>\n","protected":false},"excerpt":{"rendered":"Former defence secretary John Healey was privately pushing for the UK to join an international investment bank to…\n","protected":false},"author":2,"featured_media":636658,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[59,57,58,50,56,54,55],"class_list":["post-636657","post","type-post","status-publish","format-standard","has-post-thumbnail","category-united-kingdom","tag-gb","tag-great-britain","tag-greatbritain","tag-news","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/636657","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=636657"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/636657\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/636658"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=636657"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=636657"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=636657"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}