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Healey to set a path to 3.5% defence spending as RAF chief bets on drone wingmen

Morning Brief · Tuesday 27 October 2026

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Chancellor John Healey is expected to use Wednesday’s Budget to set out a route to the NATO target of 3.5% of GDP on core defence by 2035, rather than waiting for next year’s Spending Review. Independent analysis suggests the costings are thin. The Ministry of Defence still has an unfunded gap from June’s Defence Investment Plan, and most of the efficiency savings it relies on are unproven.

The RAF’s chief set out a plan to fly four armed uncrewed aircraft with each Typhoon by 2030. European defence ministers met in Paris to plan Ukraine’s winter air defence beyond US-supplied Patriots. Anthropic’s IPO filing gives the first audited view of frontier-AI economics. The UK also launched a £100m AI biosecurity lab and sanctioned 15 Sudanese commanders. A think-tank report details Russian help for Chinese drone programmes.

Healey is expected to set a path to 3.5% before the numbers are settled

Reuters reports that Healey will set out an increase in defence spending in the Budget rather than defer the decision to next year’s Spending Review, and Politico Europe describes the move as unexpected. (Reuters, Politico Europe) The government is already committed, with NATO allies, to 3.5% of GDP on core defence by 2035, with an interim 3% in the next parliament. (RUSI, Politico Europe) Existing plans take NATO-qualifying spending to 2.7% of GDP by 2027–28, from 2.1% in 2023–24. (RUSI)

The gap between 2.7% and 3% is large. RUSI, drawing on Institute for Fiscal Studies figures, estimates that reaching 3% by 2030–31 would need about £11bn more in that year than staying at 2.7%. (RUSI) A faster or fuller path to 3.5% would cost more, and the Budget may not say who pays. Politico notes that manifesto limits on broad taxes, high debt-interest costs and the fiscal rules leave a choice between borrowing, new taxes and squeezing unprotected departments such as justice and transport. (Politico Europe)

The existing plan is also not fully funded. RUSI says the government still has to find an average of £1.2bn a year to pay for the top-ups announced in June’s Defence Investment Plan. (RUSI) The plan assumes about £1.8bn a year of efficiencies over four years, and 70% of those are classed as “low maturity”. (RUSI) This sits alongside last week’s written answer putting the efficiency target at £10.7bn to 2029–30, with most of it falling in the final two years.

The likelier outcome is a headline trajectory with modest near-term cash. Announcing a destination is cheap for a Chancellor, while the spending falls mostly in later years. The numbers to look for on Wednesday are the first-year increase, the date at which 3% is reached, and whether the £1.2bn gap is closed with new money or by relabelling existing budgets. If the efficiencies do not arrive, the shortfall will fall on equipment programmes and personnel growth, which are the areas the new money is meant to protect.

The RAF wants four armed drones for every Typhoon by 2030

In a speech at RUSI, Chief of the Air Staff Air Chief Marshal Harv Smyth said the service’s future rests on “autonomy, not flesh”. According to the Guardian, he told the audience that crewed platforms alone are no longer enough. (The Guardian) The plan is to operate four armed, AI-enabled uncrewed aircraft alongside each Typhoon, with trials starting next year and service entry targeted by 2030. (The Guardian) He pointed to the £300m Storm Fighter programme, announced in July under the delayed Defence Investment Plan, as the vehicle. (The Guardian) The Times and the Telegraph carried the same speech. (The Times, The Telegraph) Detail rests on the Guardian’s account alone.

The 2030 date follows from Defence Secretary Wes Streeting’s statement that the UK has “a little over 1,000 days” to prepare with allies to fight and win a conflict. (The Guardian) The manpower case is also stark. Fully trained RAF personnel fell from 29,800 in 2020 to 27,850 in 2026, with growth only in the past 18 months. (The Guardian) Uncrewed aircraft are a way of adding mass without adding aircrew.

The concept is coherent, but the delivery risks are large. A £300m budget and a four-year window are tight for mature autonomous teaming, certified software, and production at a ratio of four drones to every jet. The Typhoon fleet is only a few dozen aircraft per tranche, so even a partial ratio implies hundreds of airframes. The speech leaves open who will build them, how much targeting authority the drones will hold compared with the pilot, and whether the £300m covers prototypes only. Those answers will show whether this is a funded programme or a statement of intent that anticipates Wednesday’s Budget.

European ministers try to make Ukraine’s air defence less dependent on Washington

Defence ministers from the E5 group (France, Germany, Italy, Poland and the UK) met in Paris with EU foreign policy chief Kaja Kallas and Defence Commissioner Andrius Kubilius. They pledged more political, military and financial support before winter, including winter aid packages and an air-defence capability to supplement US-made Patriot systems. (Al Jazeera, Al Jazeera) Their joint statement endorsed post-ceasefire security guarantees from a coalition of allies and committed to act against Russia’s oil “shadow fleet”. (Al Jazeera, Al Jazeera)

The practical weight is in the air-defence item, though no specifications, funding or delivery dates have been published. Russia’s strikes on energy infrastructure have been the main threat of the winter, and a UN-appointed commission of inquiry has found they amount to war crimes and crimes against humanity. (Al Jazeera, Al Jazeera) Patriot interceptors are scarce and allocation depends on Washington, a dispute that has run through recent editions.

German Defence Minister Boris Pistorius said ministers would lobby Washington to keep supplying weapons, intelligence and satellite data. (Al Jazeera) That undercuts the independence narrative. European states can pay for interceptors and promise reassurance forces, but early warning on ballistic missiles and satellite reconnaissance remain largely American. Starlink and Starshield services in Ukraine returned to full functionality after more than a week of restrictions. (Al Jazeera, Al Jazeera) Politico quotes ministers warning that Putin is not looking for peace. (Politico Europe) Negotiators from Ukraine, Russia and the US are due to meet in Abu Dhabi in the first half of November. (Al Jazeera, Al Jazeera)

Anthropic’s S-1 puts numbers on frontier-AI economics

Anthropic has filed its registration statement with the US Securities and Exchange Commission, planning to list under the ticker “ANT”. TechCrunch and the BBC, reviewing the 335-page filing, report first-half 2026 revenue of $16.3bn, against $1.2bn a year earlier. (TechCrunch, BBC News) One outlet gives $16.2bn. The operating loss was $693m. (TechCrunch, BBC News) The headline net loss of $80.7bn is far larger, and the reporting attributes it largely to non-cash adjustments on convertible debt. (TechCrunch) Operating loss is the better measure of the business. The company also reports $131.6bn in working capital. (BBC News)

The filing lists risks. Five enterprise customers account for 25% of revenue, and many large clients have no long-term contracts. (BBC News) Founders retain 50.1% voting control through Founder LLC, while the Long-Term Benefit Trust appoints most of the board. (TechCrunch) The filing also describes an incident less than a year ago in which an alleged Chinese state-sponsored group manipulated Claude to breach targets, including government agencies, financial institutions, technology companies and chemical manufacturers. (BBC News) The filing does not appear to say how the manipulation worked.

The most telling theme is physical. The Verge reports growing reliance on on-site natural gas generation because of grid delays and turbine shortages. (The Verge) The BBC reports that data-centre leasing has cost $321.4bn this year. (BBC News) That figure exceeds working capital, so it probably reflects multi-year lease commitments rather than cash spent. That is an inference, and the filing’s own wording should be checked. The price range, valuation and amount to be raised are not yet known.

The UK’s AI Biosecurity Lab relies on credits more than cash

The government has launched the AI Biosecurity Lab as part of a £165m National AI Biosecurity Initiative. It carries £100m of public money and up to £200m in commitments from OpenAI and Anthropic. (pharmaphorum, Tech.eu, Open Access Government) OpenAI is offering £100m in compute credits, model access and support through its Rosalind Biodefense programme, and Anthropic up to £100m in credits and technical access. (Open Access Government) The lab is to be an independent non-profit on the model of the AI Security Institute, with a scientific advisory committee. It will partner with Google DeepMind and Basecamp Research, and with UKHSA, Dstl and the MHRA on threat analysis, zoonotic tracking and countermeasures. (Tech.eu, Open Access Government) The Budget package also includes £120m for the AI Security Institute and £60m for the Sovereign AI Fund. (pharmaphorum)

The structure has strengths. Evaluating whether models can assist in designing or enhancing pathogens needs access to frontier models with safeguards removed, which only the developers can give. The weakness is that credits are not cash. Their value depends on the vendors’ pricing and allocation, and the terms have not been published. A government-backed evaluator also relies on companies whose products it may need to judge. The coverage is based on official statements, with no independent scrutiny of how the credits are valued. Missing details include the lab’s legal form, start date, and how Dstl’s classified work will sit within a non-profit.

Russia is helping China’s drone programmes, a US report says

A C4ADS report, summarised by the Kyiv Independent, uses trade records, corporate filings, leaks and academic literature to document Russian–Chinese defence cooperation reaching into design and testing. Only the Kyiv Independent summary is available here, and it is the single source. The report says Russia’s SPLAV sent technical documents for its 9M534 reconnaissance-drone rocket to Norinco in 2014–2015 and April 2022. (Kyiv Independent) Norinco later showed the Feilong 60A loitering munition in March 2025 and tested a cannon-fired drone in June 2025. (Kyiv Independent) Russia’s TsAGI wind-tunnel institute tested Chinese aircraft models for Norinco at least nine times in 2022–2024. (Kyiv Independent) Russian and Chinese researchers co-wrote 86 drone papers in 2022–2026, up from 36 in 2009–2021, including work on autonomous swarm algorithms. (Kyiv Independent)

The report also says sanctioned Russian firms are moving production to China. Chipmaker Element set up at least four Chinese subsidiaries in 2025, and machine-tool maker Stankomashstroy plans to move five-axis machine-tool production to Shaanxi. (Kyiv Independent) Five-axis machines are central to aerospace and weapons manufacturing and are tightly export-controlled, so this route would weaken Western controls. The report does not show whether the collaboration has produced fielded systems. Co-authored papers and a document transfer show a relationship, not how much Russian engineering ended up in Chinese hardware.

Britain sanctions 15 Sudanese commanders

The UK has imposed asset freezes and travel bans on 15 commanders from both the Rapid Support Forces and the Sudanese Armed Forces. It cites a campaign of wartime sexual violence and other atrocities, and the announcement coincides with the first anniversary of El Fasher’s fall. (Reuters, The Guardian) The Guardian names RSF Colonel Hussein Abu Jalak and Al-Nour Ahmed Adam, known as “Al-Qubba”. (The Guardian) It reports that up to 10,000 civilians were killed over two days and that 40,000 remain unaccounted for. (The Guardian) The UAE is accused of backing the RSF and denies it. (The Guardian)

Designating both sides is notable, since it avoids the impression of taking sides in the conflict. Practical effect on commanders who do not bank or travel in Britain will be limited without matching action from partners, and none is reported. The conflict has displaced 14 million people and increasingly involves drones, including strikes on power infrastructure in the east. (The Guardian) The Foreign Office list itself was not among the sources.

What to watch

  • Budget, 28 October: the first-year defence increase, the date for reaching 3%, and how the £1.2bn gap and the efficiency assumptions are treated.
  • Storm Fighter: the contractors chosen, what the £300m covers, and the rules on autonomous targeting before trials start next year.
  • Abu Dhabi talks, first half of November: whether they convene, and what the E5 air-defence package delivers before winter.
  • Anthropic IPO: price range, valuation, amount raised, and a clearer account of the data-centre commitments.
  • AI Biosecurity Lab: its legal structure, the credit terms, and any Dstl role.

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Morning Brief is generated automatically each morning by an AI pipeline that reads, selects and summarises news reporting. It is published unedited; every factual claim links to its source.