The potential for corruption and mismanagement in Nato's 5% target

With the Nato summit next Tuesday and Wednesday (24-25 June), talk of soaring defence spending and accelerated rearmament is growing. Leaders meeting in The Hague may endorse a new five percent of-GDP benchmark, backed by the EU’s Readiness 2030 policy. 

We share this sense of urgency. However history teaches us, from Iraq to Covid, that rapid spending results in waste and misallocation. The risks are high in the defence sector where secrecy can mask poor decisions from the public.

Money alone won’t guarantee security. Every euro must deliver real capability in a way that citizens can trust. Openness and oversight can bring the desired return on investment.

Without a transparent process, these gaps create the perfect conditions for waste, poor-quality equipment and corrupt middlemen to flourish while limiting the possibility of effective oversight by parliaments and civil society. But secrecy or openness is not a binary choice.

Europe’s military spending oversight is uneven. Transparency International documents that many governments still grant blanket secrecy to defence agencies, with most countries lacking the most basic safeguards when classifying defence information. 

European parliamentarians have raised concerns that Readiness 2030 sidelines parliamentary oversight through the expansion of emergency powers. 

A study of corruption risks in EU defence procurement over 2007-2019 found that more transparent military contracting resulted in lower levels of corruption. Furthermore, some governments are already proving that transparency does not slow progress.

For instance, Lithuania publishes all major contracts within 30 days and Sweden’s Defence Materiel Administration shares how it estimates their full cost of military equipment.

Critics argue that national security demands secrecy.

While true in some cases, the expert consensus is that this is often a false trade-off. The Tshwane Principles on National Security and the Right to Information, developed by transparency and security experts, provide guidance: security matters should be public by default and only withheld if disclosure poses a real threat. 

Three principles for speed without secrecy

The lesson is clear: secrecy that hides incompetence or corruption weakens defence just as much as underfunding.

To avoid this trap, we propose three principles for how Nato countries can spend faster, without compromising on transparency. 

1. Open up where we can, explain the rest 

First, publish what's safe: defence budgets, capability gaps, and the rationale behind urgent purchases. Citizens deserve a clear picture of where their money is going, and how it will protect them. 

When national security demands secrecy, independent experts should weigh the justification. Even for classified contracts, officials should be required to document their reasons clearly and submit them to an independent reviewer within 60 days. This creates a check on potential closed deals.

2. Build a European network of watchdogs

Defence manufacturing and research needs to span borders. So must oversight. 

We need better cooperation between auditing agencies and their civil society counterparts. Currently, Nato lacks any binding rules on defence transparency. At the country level, auditing capacity is uneven. 

Auditors and their counterparts can work together on data standards, information-sharing agreements, and joint investigations. 

Nato members don’t have to invent this infrastructure from scratch. It already exists in other sectors. Coordinating bodies exist between auditors and their non-government counterparts in labour law enforcement (SLIC), public finance auditors (CEAOB), and the US network of Inspectors General (IGNET). Defence must be next. 

3. Review contracts afterwards, where necessary

Speed matters in emergencies. Instead of focusing solely on approvals beforehand, parliaments and auditors could be allowed to conduct thorough reviews after contracts are awarded. 

These reviews could examine prices, delivery, and contractor behavior. Publishing contractor performance data and using strong enforcement helps deter misconduct without slowing down procurement. To be credible, these reviews ought to be led by independent audit institutions or ombuds offices with the authority to demand corrections and publish findings.

Bigger budgets and stronger accountability can go hand-in-hand.

With the right safeguards, public support for military spending can be sustained over the long-term. European citizens can understand that contractors are chosen based on quality not connections, and politicians can make decisions based on merit, not pressure. .

Speed without integrity undermines the very foundations of the European security that we are aiming to build. If leaders choose to act boldly and wisely in the coming weeks, they can deliver both. Openness and engagement are critical tools for building resilience and support through trust. 

If Europe is serious about strengthening its security, it must treat transparency not as a burden, but as a force multiplier — one that builds public trust, deters corruption, and ensures capability through accountability. 

This year, we turn 25 and are looking for 2,500 new supporting members to take their stake in EU democracy. A functioning EU relies on a well-informed public – you.