Trump administration tells Pentagon to slash budget by 8% a year

Washington - US Defence Secretary Pete Hegseth has ordered a review of the department’s 2026 budget so as to reallocate US$50 billion (S$67 billion) in funds, the Pentagon said on Feb 19, following reports that he had directed deep, multi-year cuts to military spending.

US media said Mr Hegseth directed senior Defence Department leaders to plan for cuts that could slash the defence budget by 8 per cent annually, or some US$290 billion within the next five years.

The Pentagon did not directly deny those reports, but instead described an effort aimed at removing funding from programmes favoured by former president Joe Biden and using it on those advocated by his successor Donald Trump.

“Secretary Hegseth has directed a review to identify offsets from the Biden administration’s FY26 budget that could be realigned from low-impact and low-priority Biden-legacy programmes to align with President Trump’s America First priorities for our national defence,” Mr Robert Salesses, performing the duties of deputy secretary of defence, said in a statement.

“The department will develop a list of potential offsets that could be used to fund these priorities, as well as to refocus the department on its core mission of deterring and winning wars. The offsets are targeted at 8 per cent of the Biden Administration’s FY26 budget, totalling around US$50 billion, which will then be spent on programmes aligned with President Trump’s priorities,” the statement said.

‘Revive the warrior ethos’

Mr Hegseth’s memo said the proposed cuts must be drawn up by Feb 24, and include 17 categories that Mr Trump wants exempted, including operations at the US border with Mexico and modernisation of nuclear weapons and missile defence, the newspaper reported.

It also called for funding for Indo-Pacific Command and Space Command, but did not do so for others such as European Command, which has led the way on US strategy throughout the war in Ukraine, the Washington Post reported.

The Defence Department “must act urgently to revive the warrior ethos, rebuild our military, and re-establish deterrence”, Mr Hegseth wrote in the memo, according to the Post.

“Our budget will resource the fighting force we need, cease unnecessary defence spending, reject excessive bureaucracy, and drive actionable reform including progress on the audit,” he reportedly continued.

The Pentagon’s budget for 2025 is some US$850 billion. Lawmakers across the political spectrum agree that the massive spending is needed to deter threats, especially from China and Russia.

The cuts, if implemented in full, would reduce that figure by tens of billions each year to some US$560 billion by the end of the five years.

The report did not give details of where the cuts would be made in the world’s biggest military, but an earlier Post report said that junior civilian workers, not uniformed personnel, were being targeted.

The news – which comes after Elon Musk’s Department of Government Efficiency (Doge) reportedly visited the Pentagon last week – was likely to be met with stiff resistance from both the military and Congress.

US President Donald Trump on Feb 19 signalled support for a House of Representatives Bill that would increase the defence budget by US$100 billion – a move at odds with the Hegseth-directed cuts.

The planned reductions also run counter to calls by Mr Trump and Mr Hegseth for Nato members to increase their military spending to 5 per cent of GDP a year.

The United States currently spends around 3.4 per cent of its GDP on defence, and the 5 per cent threshold would be even farther out of reach if the Pentagon’s budget is reduced.

The stock prices of major US defence contractors were hit by the news, with Lockheed Martin dropping briefly before recovering, Northrop Grumann falling nearly 2 per cent and Palantir closing down more than 10 per cent.

President Trump has vowed to slash government spending and end US support for Ukraine in its war against Russian invasion.

Mr Hegseth signalled support for Doge’s work at the Pentagon in a Feb 18 post on X: “Let’s get to work. DOGE the waste; Double-Down on warriors,” he wrote. AFP