Prime Minister Rishi Sunak has announced the UK will increase defence investment by £5bn over the next two years as he launched the updated Integrated Review.
This investment would fail to meet Conservatives' demands to commit to a goal of spending 3% of the UK's gross domestic product (GDP) on defence.
The short-term funding is around half of what Defence Secretary Ben Wallace had reportedly called for as military budgets are squeezed by the impact of Vladimir Putin's invasion of Ukraine and high inflation, although officials said he was "delighted" with the settlement.
The 2023 Integrated Review Refresh will see the UK replenish and bolster ammunition stocks, modernise the UK's nuclear capabilities and fund the next step of the Aukus programme.
It also sets out how the UK will tackle threats from Russia and China, as well as protect the economy and compete at the cutting edge of technology.
The £5bn is split, with £1.98bn provided this year and £2.97bn next year for defence.
£3bn will be invested across the defence nuclear enterprise, which includes constructing industrial infrastructure and enhancing support to in-service submarines, as well as supporting the delivery of Aukus.
The remaining £1.9bn will be used to replenish stockpiles to replace military aid donated to Ukraine, as well as invest in the UK's munitions infrastructure.
Finally, a further £50m will be provided to support wider government security programmes. However, it remains unclear how long this will take to be rolled out.
Mr Sunak, who made the announcement while in the US to discuss the Aukus pact, said the investment in the UK Armed Forces will see the UK "ready for the challenges of today and of the future".
"As the world becomes more volatile and competition between states becomes more intense, the UK must be ready to stand our ground," he said.
"We have seen all too clearly in the last year how global crisis impact us at home, with Russia's appalling invasion of Ukraine driving up energy and food prices.
"We will fortify our national defences, from economic security to technology supply chains and intelligence expertise, to ensure we are never again vulnerable to the actions of a hostile power."
The 2023 Integrated Review Refresh was commissioned to provide a response to emerging geopolitical threats, from China's economic coercion to Russia’s illegal invasion of Ukraine.
Whilst the trends were identified in the original Integrated Review, published in 2021, they have intensified – impacting the security and prosperity of the UK.
A Ministry of Defence Spokesperson said the Defence Secretary was "delighted with the settlement".
"The Prime Minister has continued his support from 2020, where record sums were invested in defence and is determined to show Europe-wide leadership," the spokesman said.
"This settlement and the commitment of an upward trajectory, carries on that momentum. The department will work to deliver the longer-term pledge of 2.5% of GDP.
"The Defence Secretary looks forward to working with the Prime Minister and the Treasury to make sure that our Armed Forces receive the investment now and into the future to keep us all safe.
"The Ministry of Defence will consider the wider implications of the IR Refresh and Spring Statement, before publishing a refresh of the Defence Command Paper ahead of the NATO summit."
The report identifies a number of priorities to tackle those threats head-on, with the number one threat being the risk facing European security by Russia and not letting Russia benefit in any way from their invasion of Ukraine.
The refreshed review also sets out how the UK will change its approach to China in order to deal with Beijing's increasing military, financial and diplomatic activity.
This includes new measures to increase the UK's economic, security technology capabilities and international development.
The 2023 Integrated Review Refresh also confirmed the UK would continue to play a leading role in Euro-Atlantic Security as well as consolidating the Indo-Pacific tilt made in 2021.
The 'Integrated Review Refresh 2023: Responding to a More Contested and Volatile World' will be presented to Parliament by Foreign Secretary James Cleverly on Monday before being available in full online.
Labour has said that the integrated review refresh fails to secure Britain's national defence for the future. Labour also highlighted that the Defence Secretary himself said that the Conservatives have "hollowed out and underfunded" the Armed Forces.
Shadow Defence Secretary John Healey said: "The first duty of any government is to defend the country and keep its citizens safe. But the Conservatives have failed to secure Britain's national defence for the future.
"The Integrated Review and Budget will not address concerns over critical capabilities which weaken our national defence and undermine the UK's Nato obligations.
"Labour's commitment to Nato is unshakeable. We will publish a defence and security review in our first year of government to make sure capabilities match the threats we face."