Perception
Pr00ne,
You are correct and the Falklands did change spending policy with the largely Navy bashing Nott Review put on ice. However, the decade did see GDP spend increases and real term increases in defence spend. GDP spend peaked at over 5% (the highest since the 1960s) and real term percentage growth started in 1980 before the Falklands. The light blue also finished the decade with more people than it started it with- a unique stat.
I wasn't there but I always thought the Tory cuts really started in 1990 and the 80s wasn't that bad, notably for the RAF. Also, if cuts were harsh then what were we spending our money on? I defer to those that worked through it.