The rationale for spending on a small military in times of safety is that it gives you a base to expand from if the times change. The skills, institutional knowledge and organization that create the potential to build a credible defence are the real value of it, not the existing equipment or capability.*

If Ireland needed a capable Army, Navy and Air Corps to defend against an existential threat, it would be borderline impossible to stand one up from nothing in time, no matter how much we spent. For minimal savings (our DF is very cheap) you'd fatally endanger the country. 

* Case in point - the US had a tiny army smaller than Portugal's in 1939, but it formed the base for expansion to a world-class one.