Nuno Melo says PS Socialists fudged defence spending by €300 million
Portugal’s minister of National Defence, Nuno Melo, has accused his predecessor, Helena Carreiras, of having reported a fictitious figure for investment in military spending to NATO.
“I am very sorry to have to tell you that the figure reported by the PS government to NATO is not true,” he told a joint hearing today of the parliamentary Budget and Finance and Defence committees on the State Budget for 2025.
Melo explained that “the figure reported to NATO was 1.48%” of GDP (Gross Domestic Product), but this amount “has not been confirmed”.
He added that he recently learned “that, in the end, the figure for Defence investment in 2023 was 1.34% of GDP and not 1.48%”.
In absolute terms, “that’s €300 million less investment in Defence in 2023”.
According to the minister, this will requite an additional effort (to recoup this amount) until 2029, so that Portugal can reach the 2% of military spending agreed with NATO.
“This means that what we have to grow will have to involve these reinforcements to make up for a €300 million hole,” he said.
Nuno Melo cited some comparison figures – such as the fact that the shortfall is 100 times more than the €3 million spent on the ‘remodelling’ of the Sagres School Ship; twice the €150 million in additional spending on military supplements and salaries that the government has implemented.
Questioned by PS MP Luís Dias whether the percentage adjustment had anything to do with the upward revision of GDP itself, Nuno Melo replied that, no, it didn’t:
“I wish it did, but unfortunately it doesn’t”.
The minister explained that the ‘hole’ has to do with “the principle of the onerousness of buildings, which has not been settled”. This is a sum of €160 million that the Armed Forces have to pay to the Treasury as ‘rent’ for the use of barracks and other infrastructure, and which is seen in the military institution as a way of artificially inflating investment in Defence, since it is neutral for the State.
The other missing sum has to do with the “€87 million from the Military Programming Law (LPM) for own revenues”, which has not been reached. The PS government inserted a paragraph in the LPM, which immediately sparked internal protests because it was impossible to fulfil, in which the branches would have to earn that amount from the sale of real estate, in addition to the €20 million established in the Military Infrastructure Law. This deficit also has to do with “a difference between what was executed and what was forecast, starting with the GNR and the Caixa Geral de Aposentações (the State’s pension service)”.
“We’re talking about everything you should have done but didn’t,” Nuno Melo told the PS benches. “If you didn’t do it, it unfortunately resulted in a €300 million difference that we will now unfortunately have to report to NATO.”
Covering this exchange, Expresso stresses that it reported back in July that the figures lacked credibility, “since Portugal reported 21.9% spending on military equipment out of the total defence budget. This percentage seemed too high and it was unclear what it accounted for: the LPM had planned to spend €278 million on arms purchases (12% of the Ministry’s expenditure). But that 21.9% represents a giant leap for an investment of more than €840 million a year.
“Impossible, there is no investment of that amount,” a senior military officer told Expresso at the time.
Also at the time, Nuno Melo’s office replied that it would have to study the figures.
In fact, the real figures for investment in Defence are even lower than those Nuno Melo announced in parliament, says Expresso.
In 2023, the budget implemented by the PS government was €2.3 billion, which corresponds to just 0.85% of GDP, although the Alliance’s official tables account for €4.2 billion (1.55% of GDP), because expenditure on the GNR and ex-servicemen’s pensions were taken into account. This accounting, however, is permitted by NATO rules, says the paper.
Government wants country to produce more arms and munitions
On a slightly more positive note, Nuno Melo has reinforced the comments made by prime minister Luís Montenegro in Budapest last week about wanting to ‘dynamise’ defence industries in Portugal, whether for national production or as part of international consortia.
In a document due to be presented today, Nuno Melo will be discussing the €479 million that has been earmarked within the State Budget for next year to be spent on re-equipping and modernising the Armed Forces.
According to tabloid Correio da Manhã, the minister will be defending that Portugal should be reinforcing its export capacity in terms of goods and services (by including armaments in national production) and “integrating within chains of large weapons producers” – and he will be outlining aquisitions-in-waiting, including the purchase of A-29 ‘Super Tucano’ aircraft, made by Embraer, in Évora, “whose NATO certification will allow Portuguese industry to participate in its development and increase the possibilities for supporting ground forces and training pilots”.
natasha.donn@portugalresident.com
