The government has already rolled the department overseeing overseas aid into the Foreign Office and some in government have argued for a reduction in aid spending from 0.7 per cent of the country's national income gross to 0.5 per cent, which would equate to billions of pounds.
Britain's main opposition Labour's Party said the increase was long overdue after the ruling Conservative government had cut the size of the armed forces by a quarter in the last decade.
Johnson is seeking to show his government is on track to deliver manifesto promises after a tumultuous few days in which he was forced to self-isolate after coming into contact with someone with Covid-19, and his most senior adviser, arch Brexiteer Dominic Cummings, was ousted.
"Our national security in 20 years' time will depend on decisions we take today. the global situation is now more perilous and intensively competitive than at any time since the Cold War".
"Next year represents a huge opportunity for this country, and Defence will be at the forefront of creating the jobs and business opportunities that will help us build back from the pandemic".
"Our people are sustained by a web of lifelines, oxygen pipes that must be kept open - open shipping lanes, a functioning internet, safe air corridors, reliable undersea cables, and tranquillity in distant straits".
Making his promise to "restore Britain's position as the foremost naval power in Europe", he added: "If there was one policy which strengthens the United Kingdom in every possible sense, it is building more ships for the Royal Navy".
- A new fighter system for the RAF, using artificial intelligence and drone technology to "defeat any adversary in air-to-air combat".
Malcolm Chalmers, deputy director-general at the Royal United Services Institute for Defence and Security Studies's think tank, said the new military budget means the UK will retain its position as a middle-rank military power alongside nations such as France, Germany and Japan, but well behind the United States and China.
Taking advantage of new technology, while acting speedily to "remove or reduce less relevant capabilities", will transform the UK's capabilities.
"The returns will go far beyond our Armed Forces" as the new investment will also create 10,000 jobs every year and 40,000 in total, Johnson added.
His remarks will come as a relief for military chiefs, who have been pressing for a multi-year settlement to enable them to plan effectively for the future.
Wallace insisted the government was not "abandoning the battlefield of global aid" but said the "decisions on the numbers" will be revealed by Treasury chief Rishi Sunak next week.
The rough plans laid out by Boris Johnson are a preview of an expected detailed policy announcement later in the year or early in 2021.
President-elect Joe Biden that Britain was determined to remain a valuable military ally.
"The UK is our most stalwart and capable ally, and this increase in spending is indicative of their commitment to North Atlantic Treaty Organisation and our shared security", he said.