Military operations in Iraq and Afghanistan are to get an extra £520 million funding, bringing the total committed to the conflicts to £5 billion, Gordon Brown said today.

When the war started in Iraq last year, the Chancellor announced that the Treasury was allotting £3 billion out of reserve funds to cover all the costs.

However, with the continuing deployment of thousands of troops, and their likely stay in the country for another two years, the estimated costs have risen sharply.

Today Mr Brown offered the cash boost that will raise the total Ministry of Defence budget from £29.7 billion to £33.4 billion by 2007-08. There are 8,500 British troops in Iraq compared with about 860 serving in Afghanistan.

The Chancellor told the Commons during the Queen's Speech debate: "I am setting aside in the special reserve a further £520 million for this year - raising the provision overall to almost £5 billion."

The £5 billion for Iraq and Afghanistan compares with the £2.5 billion cost of the 1991 Gulf War, £866 million for Kosovo in 1999, £429 million for Bosnia and about £1 billion for the Falklands War in 1982.

The war in the Falklands was costly because of the 8,000 miles the task force had to travel to get there, as well as the loss of capital equipment. Six ships were sunk by Argentinian bombers and ten others were badly damaged; 255 troops were killed.

• The Pentagon is to increase US troop levels in Iraq by 10,000 to bolster security for the January elections. The injection of 1,500 troops coupled with extended tours for thousands more servicemen and women currently serving in Iraq was announced yesterday.

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