LONDON — U.K. Chancellor John Healey is set to deliver an unexpected increase in defense spending at his first budget on Wednesday, as Britain strains to reach its NATO commitment to spend 3.5% of GDP on defense by 2035.

Healey — who quit as defense secretary in the dying days of Keir Starmer’s government over a funding row — hopes he can show how Britain will start to reach that target now that he’s safely ensconced in the powerful Treasury.

Until last week, it was assumed that the top finance minister would defer decisions on ramping up funding until next year’s multi-year, government-wide spending review. So Wednesday’s move could represent an early win for the Ministry of Defence in Prime Minister Andy Burnham’s new government.

But with regular warnings in the press and in public about Britain’s unpreparedness for conflict, there’s much more to watch for beyond Wednesday’s headline hike. POLITICO walks through the seven key details and defense industry demands.

1) How will Healey play the numbers game?

Healey’s government-rocking resignation back in June was explicitly over a refusal in Downing Street and the Treasury to commit to spending 3% of GDP on defense by 2030.

Now that he is leading the Treasury, Healey is under pressure to deliver on that. But even that keeps Britain shy of the bigger NATO aim.

On existing plans, U.K. defense spending is set to rise to 2.7% next year and remain flat until 2030. Healey’s first move will be to fill the £4.7 billion black hole in defense funding in the Defence Investment Plan — meant to overhaul the armed forces and improve readiness — published earlier this year.

More money is now expected beyond this, briefed to the media in recent days as a “down payment” towards spending 3% on defense by 2030.

But two government officials, granted anonymity like others in this article to discuss internal thinking, said the pathway to meeting NATO’s larger, 3.5% target will only come in next year’s spending review, not the budget.

Even on the smaller measure, the margins for the chancellor are tight, with government spending rules and debt targets leaving little room for maneuver. Mike Martin, an MP on the House of Commons Defense Committee, told POLITICO: “They have got themselves into a straitjacket over defense spending and none of this will be resolved before the next election. This is why I think an early general election is inevitable.”

2) Will the chancellor move to funnel private capital into defense?

Britain’s defense industry has long called for more direct government spending on domestic contracts. But the sector also wants more private capital flowing into U.K. firms, and will be looking to Healey to set the conditions.

The Financial Times reported last week that Healey will allocate £15.4 billion to the country’s National Wealth Fund and £5 billion to the British Business Bank — a share of which could end up with defense companies.

Two key details to watch here are whether the government claims this money counts towards its wider defense spending commitments, or whether any cash is allocated purely for defense firms. Potential reforms to and incentives for pools of private capital, such as pension funds and venture capital funds, to invest in defense would also be welcomed by the sector in this budget — but the industry may be left waiting.

One of the government officials cited above said that a Defence Finance and Investment Strategy is slated for December, with a Defense Investment Summit coming December 1.

3) Where does Healey stand on global defense team-ups?

On Sunday evening, the Treasury disclosed that it would not join the Canadian-led Defence, Security and Resilience Bank (DSRB) — a proposed multinational financial institution with its own AAA credit rating that aims to provide cheap loans for countries to invest in defense.

The U.K. had previously considered joining the bank, or merging it with its own separate initiative, the Multilateral Defence Mechanism (MDM) — a planned scheme for joint defense procurement, stockpiling and supply chains for member countries.

But a joint statement with Ottawa said that the institutions will now work in partnership.

The MDM currently has £400 million allocated from June’s Defence Investment Plan, while none of the other member nations — the Netherlands, Finland and Poland — have confirmed whether they have contributed capital to the project.

Now that uncertainty over Britain’s membership of the DSRB has gone, the government will be looking to flesh out its plans for its own MDM.

4) Can the chancellor slash energy and manufacturing costs?

Two industry figures told POLITICO that one of the biggest barriers to doing defense business in Britain — making it less attractive than other nations — is the country’s comparatively high energy costs.

However, slashing costs for energy-intensive industries, including the industrial base of the defense sector is expensive, and schemes aimed at reducing costs — such as the British Industrial Competitiveness Scheme – already exist. Measures reportedly under consideration this time around appear to focus more on reducing households’ energy costs than on supporting businesses.

A third industry figure predicted that ministers would not offer immediate support for business energy bills because “every possible option” for instant help “is too expensive.” But a defense industry investor said the Treasury is, however, looking at reducing the financial burden of machinery — which they said is a key issue for small firms wanting to ramp up production as part of the supply chain.

5) What does Buy British actually mean?

The government has been consulting with the defense sector and wider British industry over what exactly constitutes a British company under its plans to implement a new “Buy British” scheme.

The plan aims to bring together Andy Burnham’s pledges of re-industrialization and more evenly-spread growth across the country, and comes after the EU proposed its own Made in Europe procurement plan to try and boost the bloc’s own firms.

The push is also designed to build sovereign capability, which has become increasingly important to Britain amid fears that the U.S. is an unreliable ally. The recent row over Ukraine’s constrained access to the Starlink satellite system has exacerbated such concerns.

Early suggestions indicate the government will take a broad definition — in a potential boost for multinational defense giants. Rupert Pearce, the Ministry of Defence’s National Armaments Director, told a recent industry event that, from his perspective, French defense company Thales, which has a headquarters in the U.K., “is a British company.”

6) Will Healey move further on AI and hybrid defenses?

Ahead of the budget, Healey’s Treasury announced a series of AI-specific policies with potential defense applications.

These include £165 million for AI-driven detection and surveillance of biological threats — a move first teased by the boss of Britain’s MI5 intelligence service.

The government will also put £60 million into its Sovereign AI fund to invest in British tech companies, including autonomous systems, robotics, and advanced manufacturing.

Watch to see whether the chancellor waves around more promises of boosting British resilience to malign actors on Wednesday.

7) Will Donald Trump even notice?

Britain’s comparatively slow progress on defense spending has already caught the eye of the Trump administration.

Warren Stephens, the U.S. ambassador to the U.K., warned earlier this year that Britain must make “sustained investment” in defense, rather than focusing on “other spending priorities,” and warned against “backloading” defense spending to a later date. 

A lack of a meaningful movement on defense spending — or at least eye-catching claims from opposition parties that Healey has fumbled it — could grab the attention of Trump’s team this time around. The timing is tricky: the Pentagon is currently undertaking a review of American military assets stationed in mainland Europe and the U.K.

he world is starting to understand that there is no way to fully and lastingly protect itself from President Donald Trump.

The man just can’t let things go — and he’ll get creative to get what he wants.

The latest blowup over Ukraine is emblematic of Trump’s wily persistence, and it suggests a challenging two years lie ahead for the international set even if Democrats gain some power in the midterm elections.

Not that long ago, Trump seemed to have patched up ties with Ukrainian President Volodymyr Zelenskyy as Kyiv made gains against Russia. Trump signed legislation last month that was championed by his late friend, Sen. Lindsey Graham (R-S.C.), to impose heavy new sanctions and tariffs to punish Russia for its war on Ukraine.

This month, the original Trump — the one who fawns over Russian leader Vladimir Putin and despises Zelenskyy — roared back. He waived many of the legislation’s penalties on Russia, moved to buy Russian diesel and signaled he’s more interested in doing business with Moscow than seeking justice for Kyiv. Ukrainians suspect the U.S. has pressured them by throttling its satellite connections and intelligence-sharing. (The Trump administration disputes much of this.)

“Russia, frankly, has been fine on Ukraine,” Trump said Monday as he welcomed the idea of an arms control summit with Putin and Chinese leader Xi Jinping that might include talks about Ukraine.

The lesson, foreign officials and others steeped in diplomacy tell me, is that you cannot truly change Trump’s mind or stop his overall trajectory. Even if Trump seems briefly chastened or stages a tactical retreat, he will eventually return in new, often-surprising modes to push his original views and goals. He will try to exhaust you into submission.

Imagine how startling it is to be Ukrainian these days as Trump pressures you to make concessions to Russia by blaming you for a global energy crisis he caused by launching a war on Iran. Or what it’s like for officials across European capitals trying to craft a response, knowing there’s never an end to the process.

“There is no immunity to Donald Trump. He makes a deal in order to make a better deal the next day,” one senior European official mused, having been granted anonymity because the topic involves sensitive diplomacy.

It’s hard to blame world leaders who think they’ve learned to manage Trump only to be bewildered by a sudden left hook on his part. Foreign policy is often driven by hope when you lack good options. And Trumpology is a confounding, but still a relatively new, subfield.

Besides, Trump’s messaging is inconsistent, incoherent and nonstrategic — characteristics that can obscure his single-minded pursuit of his goals. So the global actors dealing with him — whether it’s the Gulf Arab states who shower him with gifts or the Canadians furious over his trade and territorial threats — sometimes think they’ve come to terms with him only to find they’re fighting on a newly configured plane.

A Supreme Court ruling that gutted many of Trump’s tariffs earlier this year was good news in many capitals. But since then, the so-called Tariff Man has moved to impose the import taxes under pretexts not considered by the court, including turning to accusations involving forced labor.

The White House doesn’t dispute Trump’s aggressive tactics.

“There is no greater fighter for America First interests than President Trump — and he is willing to look anyone in the eye to deliver wins on behalf of the United States,” spokesperson Anna Kelly told me in a statement.

The Greenland saga shows the limits of trying to mollify Trump.

In his first term, Trump wanted to buy the frozen island. The idea was shelved amid global laughter, but authorities in Greenland and Denmark made it clear to Trump that they welcomed more U.S. investment in the Danish territory.

In his second term, Trump huffed and puffed about an all-out U.S. takeover of Greenland, only to agree in September to an expanded U.S. military footprint that he could have gotten anyway under existing, decades-old diplomatic accords without all the drama. The whole affair has led to lingering anger in Europe about what Canada’s leader called a “rupture” in the global order — but many European officials hoped that the saga had faded away.

Yet, it’s far from certain that Trump has given up on possessing Greenland. Just days ago, he touted on social media plans to start oil, gas and mineral exploration in “our new and beautiful Greenland.”

The use of “our” is more than a little suggestive.

Defying Trump, too, can get you only so far.

Brazilians effectively told Trump to take a hike when he used tariffs and sanctions to punish the country for charging its former president, Jair Bolsonaro, in a coup attempt.

A few months later, as Bolsonaro was about to start his prison sentence, Trump seemed to admit defeat in his effort to help his political ally. “That’s too bad,” he said in November 2025, with little emotion. (“Brazil Defied Trump and Won,” The New York Times declared.)

But Trump wasn’t done with Brazil. He and his team have pursued efforts to undercut the current Brazilian government while quietly backing Bolsonaro’s son, Flávio, in his efforts to win the presidency this year. The runoff election is on Sunday, and it’s tight.

World leaders are doing what they can to make their countries Trump-resistant, if not all-out Trump-proof.

That has meant everything from diversifying their sources of trade and security alliances to joining Trump on ventures that, on the surface at least, can be helpful to them. (Then there are the many countries, especially in Africa, that diplomats privately tell me are happy to be off Trump’s radar.)

My takeaway from watching all of this, though, is that it’s not enough to stay one step ahead of Trump. You have to stay several steps ahead, and you have to be wildly imaginative about the lengths to which Trump and his devoted aides are willing to go to complicate your life.

The second Trump administration is filled with people who have turned to unique, bizarre and clever interpretations of law and reality to push his agenda. It’s not always clear who is behind which move, but it’s hard to imagine Trump isn’t fine with most of what’s happening.

It’s why a teenager is being held in immigration detention for the actions of his grandmother decades ago. It’s why Congress can scream and shout about its spending orders yet Trump ignores it.

Sen. Chris Murphy (D-Conn.) said other nations should not hope that the Republican Party will shed Trump’s worldview, including his disdain for allies, once Trump’s out of power.

“I would love for our allies to know that we have consistent common adversaries that we’re going to work together to fight. I just don’t know that you can make that guarantee,” Murphy, a frequent Trump critic, told me. “That’s painful to say, but given the state of the Republican Party right now, it’s true.”

I understand why Ukraine and the European Union are trying to diversify their sources of intelligence and military industrial bases as Trump keeps chasing love from Russia.

Despite Secretary of State Marco Rubio’s claims, the reality is that the United States can no longer be trusted for such security assistance.

But it’s not enough to find new intelligence partners or weapons manufacturers. You have to ask bigger questions, like, “What are the untapped streams of intelligence that no one knows are out there? What’s a potential weapon no one has considered? How can I acquire what I need before Trump stops me?”

Governments need to have plans — now — for scenarios that seem completely crazy. Better to be wrong than unprepared.

Still, even if you do all of that … “I don’t think it’s possible to stay two or three steps ahead of Trump,” said Charles Kupchan, a former senior national security official during the Obama administration who apparently enjoys raining on parades.

“He acts on impulse,” argued Kupchan, who has a new book out on the crumbling world order. “We need to try to limit the damage he’s causing and ride him out.”

A Democratic win in November’s midterms — one or both chambers of Congress — is unlikely to do much to rein in Trump’s actions abroad during his final years, current and former U.S. and foreign officials tell me.

He still has the veto and has been willing to ignore congressional demands. There’s also the fact that presidents have significantly more power to act in unilateral ways overseas than they do domestically.

Ukraine, the European Union, the world — all will be dealing with a politically wounded Trump who’s likely to double down on what he feels he must have.

“He’s going to be angrier,” Murphy predicted.

Czech President Petr Pavel says a ceasefire between Russia and Ukraine was “quite close” – until President Donald Trump lifted sanctions on Russian diesel. 

In an interview conducted on Tuesday with the Axel Springer Global Reporters Network, which includes POLITICO, Pavel said coordinated U.S.-European sanctions on Russian oil, oligarchs, and other industries were putting Russia “under strain.” But the deal Trump announced earlier this month, in which Russia would supply hundreds of thousands of tons of diesel to the U.S., gave Russia “time to breathe.”

“It will be much harder now,” said Pavel. “Russia uses this momentum to get out of pressure, and it’s kind of a moral boost for them.”

The White House on Wednesday said Trump “successfully negotiated” the deal in order to supply the global market with “massive amounts of diesel and bring prices down.”

The deal quickly drew backlash and, at one point, a bipartisan group of U.S. senators urged Trump to rescind the deal.

Meanwhile, Ukrainian President Volodymyr Zelenskyy said in a post to social media that the deal “plays into Russia’s hands” and allows Russia “to kill more, wage war for longer, have even less respect for America, and inflict even greater losses and damage on the world.” He accused Trump of using peace talks in Florida as a “smokescreen” as the administration pursued its deal with Russia.

Zelenskyy’s criticism was the latest indicator of rising tensions between Kyiv and Washington. Trump has repeatedly expressed frustrations with Zelenskyy, accusing him of elongating the war. By contrast, of late he has spoken warmly of Putin and said this week that “Russia frankly has been fine on Ukraine.” 

But Pavel offered the Ukrainian president words of support on Wednesday. 

“I believe that President Zelensky and the whole of Ukraine is a victim of a conflict,” said Pavel. “So, I would be probably the last to blame Ukraine for being guilty of the conflict. It was not Ukraine who attacked Russia. It was not Ukraine who was threatening Russia.”

He added that Trump shows a more open approach to Russia than any European leader. 

“To some extent, he may be attracted by Vladimir Putin as a leader with authority, but I don’t think that … President Trump sees it from a position of a struggle between democracy and autocracies because he’s looking at it simply from the point of view of economic prosperity for the United States,” Pavel added.  

Though Pavel indicated concerns about the diesel deal, he declined to say the U.S. had betrayed Ukraine or other European partners. 

“I don’t know yet if we can call it betrayal, but I would call it a mistake,” he said. “Because … it’s now giving Russia a new hope: New hope that they can disregard Europe, they can disregard Ukraine, they can focus on making a deal with the United States, potentially with China, and arranging all things up to their priorities and strategies. I believe that it’s clearly against our interest in Europe.”

Pavel also didn’t rule out a future in which European countries would buy Russian oil, but added that it “will take time” before that happens. 

“If one day Russia is a country respecting other countries’ sovereignty and borders, why not have regular business with such a country? But Russia is not there yet,” he said. 

The Axel Springer Global Reporters Network harnesses the resources of the company’s newsrooms to publish ambitious scoops, investigations, interviews, opinion pieces and analysis. It allows journalists — including those from POLITICO, Business Insider, WELT, BILD, The Telegraph, Onet and Fakt — to collaborate on major stories for an international audience of hundreds of millions across platforms: online, print, TV and audio.

Starlink restrictions hampering Ukraine’s war effort are “a planned operation,” Ukrainian President Volodymyr Zelenskyy said on Saturday.

The satellite service operated by Elon Musk’s SpaceX is still deactivated in Ukraine at speeds over 160 km/h, which prevents some of its drones to intercept high-speed Shahed drones used by Russia, Zelenskyy told reporters in a WhatsApp chat.

He added that Ukraine conducted a test by sending Starlink-equipped vehicules to European Union countries, at speeds over 180 km/h. “Starlink kept working … The conclusion is this: the restrictions are in effect in Ukraine, but they are not in effect in European Union countries. So, this is a planned operation,” Zelenskyy said.

The restrictions have revived questions on Ukraine’s reliance on the satellite system operated by a U.S. company amid escalating tensions between Kyiv and the White House. “This will cost many of us our lives,” an experienced Ukrainian officer told POLITICO and the Axel Springer Global Reporters Network earlier this week.

“We’re reaching out to everyone at the military level, at the Ministry of Defense level, and at the diplomatic level, including to SpaceX. Right now, no one is responding to our military or the Ministry of Defense,” Zelenskyy told reporters.

The European Union is under increasing pressure to provide Ukraine with an alternative to Starlink. But negotiations between Brussels and Kyiv over access to the bloc’s Govsatcom program — which gives participating governments secure communications capabilities— have been stalling. And IRIS², the EU’s in-house planned network to match Starlink, is only expected to come online in 2030.

“The Europeans are now raising the question of alternatives themselves. And they’re already working on them. They’re already making progress, and they’ll succeed in this area. I can already see that,” Zelenskyy said.

SpaceX did not immediately responded to a request for comment.

Earlier on Saturday, Zelenskyy accused Russia of looking to create a blackout across Ukraine, amid attacks on energy infrastructure and the waiver of U.S. sanctions on Moscow.

“Russia is trying to cause a blackout in Ukraine right before winter. Russia is trying to leave millions of our people without electricity and heating. Pressure is needed to stop this,” he said on Telegram.

“An American sanctions blackout, easing pressure on the aggressor, monetary rewards for [Russian President Vladimir] Putin: all of this only encourages him to keep striking,” he added.

The Ukrainian leader’s comments come after Russia carried out strikes on the war-torn country’s energy sector, including power generation and transmission facilities, with more than 320 jet-powered Shahed drones, loitering munitions, cruise and ballistic missiles. Power was reportedly cut for about 1 million people.

They also come as U.S. President Donald Trump signed on Friday an executive order that waived key sanctions on Russia — a decision that Kirill Dmitriev, Putin’s special envoy for investment and economic cooperation, described as “an important and truly historic moment.” Trump’s move comes only a few days after he made a deal with Putin over supplying barrels of diesel, leaving European countries and Ukraine stunned.

“A decision was unfortunately made in America to completely ignore Lindsey Graham’s bill, which was supposed to introduce truly effective pressure on Russia to end this war,” Zelenskyy said. “This bill could have helped a great deal, and it still can! But the law needs to actually work, and every vote for it matters.”

This article was updated. Veronika Melkozerova contributed reporting.