West Germany will not meet a Western alliance target for a 3 percent real increase in 1982 military spending because of budget cuts, Chancellor Helmut Schmidt announced. Defense Ministry officials said that, after inflation was discounted, the revised budget provided for no increase at all, or even a slight reduction in real terms.
Presenting a range of austerity measures agreed upon at an all-day Cabinet meeting. Mr. Schmidt said the defense budget would rise by a nominal 4.2 percent in 1982, in line with overall government spending. This could cause friction with the US, which is pressing European allies hard to carry out a NATO pledge for a 3 percent increase in military spending.