HM Treasury and the Ministry of Defence published the funding breakdown for the Defence Investment Plan on 30 June 2026, identifying £10.3bn: £4.0bn from a 1p-in-every-£1 cut to departmental capital budgets, £1.1bn from asset sales, £2.4bn of Treasury support for international objectives and procurement, £0.8bn of savings from the Department for Transport and £2.0bn from the Department for Energy Security and Net Zero1. A further £4.7bn is deferred, in the government's own words "to be funded at Budget 2026".
The parts do not behave the same way, which is why the single total is the misleading version. Asset sales and Treasury support come to £3.5bn between them, roughly a third of the package, and neither can be repeated next year. You can sell a building once. The defence bill arrives every year. Funding a permanent commitment with one-off receipts is a recognised presentational device in UK fiscal accounting, and it has form: the same structure appeared in the privatisation receipts of the 1980s and in local authority capital receipts through the 2010s. It ends the same way each time, when the saleable assets run out.
The capital budget cut behaves differently again. Reducing departmental investment by a penny in the pound produces a clean saving now and a cost that surfaces years later as a maintenance backlog on roads, schools and estates that were not renewed on schedule. Whether the 1p cut saves money or merely defers it depends on which projects were dropped.
One consequence has already been made explicit. A written ministerial statement of 19 March 2026 confirmed official development assistance falling to 0.3% of gross national income by 2027/28 to help pay for defence, with a stated intention to return to the long-standing 0.7% target when finances allow2. The autumn Budget is where the remaining £4.7bn either becomes money or becomes another round of reprioritisation.
