A more accurate way of characterising the contest is to say that it's between the Treasury and No.10, i.e. the PM's staff. No. 10 had been supporting a multi-year settlement for MOD, which in normal times would mean the battle was won. This time, however, it seems that the currently-unsackable Chancellor went straight to the PM and 'convinced' him otherwise. At least, that's the reading of experienced Whitehall-watchers like Michael Clarke: