Two former Conservative defence secretaries have given qualified backing to a plan reportedly being weighed by new chancellor John Healey to use defence bonds to raise extra funding for the UK's military. Healey, who resigned as defence secretary in June over what he said was a £13bn shortfall in the defence budget, is understood to be considering joining a Canada-led Global Defence Bank scheme to secure cheaper financing for defence projects, having previously been blocked from doing so by then-chancellor Rachel Reeves.

A source close to Healey said Reeves had refused even to discuss the idea, despite repeated approaches from the scheme's backers, and claimed Healey now intends to revive the bid after replacing her at the Treasury. Nine countries, including Canada, Belgium and Ukraine, have already joined the bank, with UK membership estimated to cost around £870m over three years while allowing pooled funding of defence firms. Sir Gavin Williamson and Sir Malcolm Rifkind both voiced support for exploring the option, though new leader Andy Burnham has pledged to retain Reeves' fiscal rules on borrowing, and markets remain wary of increased government debt.