The World - News from Jan. 17, 1986

Britain has drawn up plans to cut defense spending in real terms (after adjustment for inflation) by almost 7% over the next three years, the treasury announced. The proposal is part of a plan, which must be approved by Parliament, for the first such cut in public spending since Prime Minister Margaret Thatcher’s Conservative government took power in 1979. It will also be the first time that Britain does not fulfill an undertaking to the North Atlantic Treaty Organization to boost defense spending by 3% a year in real terms. In cash terms, defense spending will increase to $27.3 billion from $26.2 billion but will not keep up with inflation.