'Creative accounting' helped UK government meet Nato defence spending target say MPs

The Conservative government has been able to meet its commitment to spend 2% of the UK's GDP on defence each year by using "creative accounting", according to a group of MPs. The House of Commons' defence committee said it was "unclear" as to what accounts had been included in the Defence Budget, said reports on 21 April.

The MPs in question pointed out that the government had included war pensions and intelligence-gathering to meet the Nato target. The committee said the Ministry of Defence (MoD) can only refute claims of 'creative accounting' by outlining what the new inclusions are in the Defence Budget and from which department each was funded previously.

"It's good news that we have managed to achieve the 2% promise for Defence Spending but if the MOD has only achieved this by including things like war pensions or intelligence gathering which previously came under other budgets, you wonder what effective, battle-winning spending increases have actually been made. The MoD have shed insufficient light on this confusion," said Dr Julian Lewis MP, chair of the defence committee, according to The Independent.

The MoD has insisted that the reporting of spending on intelligence-gathering and pensions falls within Nato's guidelines. "When defence spending will increase by £5bn ($7.1bn) over this parliament it is nonsense to suggest there is no new funding," a spokesman for the department said.

"Our plans will deliver more ships, more planes, more troops at readiness, better equipment for special forces, and more on cyber to help Britain safe."

But Labour's shadow defence secretary, Emily Thornberry, accused the government of "fiddling the books". She argued: "After the crippling cuts to the Armed Forces imposed by the Tories throughout the last Parliament, we were promised that 2015 would mark a turning point.

"Instead, it's increasingly clear that the 2% commitment is being delivered not through increases in front-line defence spending but by fiddling the books. Time and again on defence, the Tories are shown to be all rhetoric and no reality, and it is our Armed Forces who are paying the price."