Examination of Witnesses (Questions 300
- 319)
WEDNESDAY 12 JANUARY 2000 (Morning)
MR COLIN
BALMER, MAJOR
GENERAL JOHN
KISZELY AND
MR TREVOR
WOOLLEY
300. Likewise, could I ask you if you could
give us what the crew deployment was when that decision was taken,
and what the ship's full complement was meant to be at the time
the decision was taken?
(Mr Balmer) I can certainly provide that information.
Can I return to some slight misinterpretation in the first part
of your original question, which is that, in fact, the Commander-in-Chief's
budget has not been cut in the current year; we have increased
it, for reasons to do with extra costs of fuel and the costs of
some of these deployments. Judging the sorts of measures he needed
to take to stay within his budget is what led to the decision
on the Marines exercises. That was living within the budget. I
think the figure for the saving from non-deployment was of the
order of £3 million, but I will confirm that for the Committee[3].
Mr Colvin
301. Some exercises are paid for through barter
- I cannot remember whether it was the EH101 helicopter or the
upholder submarines, but it was BATUS in Canada—but if we
do not actually use facilities provided to us for exercises do
they pay cash for the equipment they are buying instead?
(Mr Balmer) I would need to look into the details
of that arrangement. I think, as I understand matters, the deployments
to BATUS have been continuing pretty well as normal. Clearly there
are times of the year in which BATUS is not available because
of weather conditions, but I am not aware that we have reined
back the amount of our training on that.
Mr Colvin: Is there any peace dividend
from Northern Ireland?
Chairman
302. We are coming on to that later on.
(Major General Kiszely) Just to amplify what Mr Balmer
said, there was one exercise, one of the Medicine Man series of
exercises, this year where the battle group who were due to take
part in it did not do so because they were involved in the Kosovo
extraction force. So they did not take part in the exercise for
operational reasons. Actually, the number of BATUS exercises is
reducing from six to five per year, because we decided that five
long exercises make rather more sense than six short ones, so
the Medicine Man Six deployment did not take place this year and
is not due to take place next year either[4].
Mr Colvin: Perhaps we could have a note
as to whether that has an impact on procurement.
Mr Cohen
303. There has been some cutbacks in the anti-drug
trafficking work, for example, in the Caribbean. Was this imposed
for financial reasons? I see there is this category here of budget
reasons for cutbacks but what about where there is, for example,
interdepartmental disputes about who should be footing the bill?
Does that sometimes end up as a financial cutback on defence work?
(Mr Balmer) I will not pretend that we do not have
interdepartmental disputes in Whitehall because we do, and occasionally
we will debate both over whether the armed forces could be deployed
in support of another Department's objectives and, if they are
so deployed, what the costs should be. Those matters will be debated
between the departments during the course of the year and we will
reach agreement. I am not aware of any major dispute, or any significant
dispute, causing us to have a budgetary problem and, therefore,
causing us to take a particular action as a result. If we have
had any debate with other departments they have been over fairly
marginal amounts of money. I do not know whether Mr Woolley can
add anything on the effect of the budget measures on drug operations.
(Mr Woolley) Yes. There has been no reduction in the
counter-drugs activity in the Caribbean. The position is that
we have a West Indies guard ship that is on station in the Caribbean
for 75 per cent of the year.
304. It was previously the whole year.
(Mr Woolley) This was before the Strategic Defence
Review. As a result of the Strategic Defence Review the position
is that there is a guard ship on station for 75 per cent of the
year, and for 25 per cent of the year there is always a ship that
is within 14 days' sailing of the Caribbean. The guard ship is
there especially during the hurricane season because its primary
task is the security of the dependent territories and humanitarian
relief in the dependent territories in the event of a hurricane.
It is there to assist the US and law enforcement authorities when
other tasks permit. There have been some very notable successes
of that ship—
305. Absolutely.
(Mr Woolley) Both as reported in the performance report
and even more significant successes in the period since that covered
by the performance report.
306. It is because of those successes that the
reduction is a matter of concern, but I do not recall it being
specifically drawn out in the SDR that this was going to happen.
You may well be right that this has happened since the SDR but
can you show us the indication in the SDR where this was reduction
was going to happen?
(Mr Woolley) I cannot point specifically to it but
it is certainly not the case that there has been any reduction
this year in the presence of the West Indies guard ship for budgetary
reasons.
Chairman
307. I am sure 14 days is pretty good notice
to any drug smugglers that the Royal Navy is not going to be around.
In the same way—not that there is any threat from Argentina—that
there is not even a ship permanently on duty in or around the
Falklands, unless you include an unarmed vessel.
(Mr Balmer) I think the important point, Chairman,
is that we do not necessarily announce in advance when the ship
will or will not be available, so the 75 per cent of the year
in which it is physically there is an unpredictable 75 per cent,
if you are a drug-runner.
308. I am sure people will read Hansard
and Mr Hancock's questions, and you will have asked questions
on this subject. Following Crispin Blunt's entertainment question
regarding the queues going into the Millennium Dome, I remember
that a few years ago the last Government declined Stephen Speilberg's
request for troops to participate in the filming of Saving
Private Ryan. I read recently that we are offering troops
for the making of a follow-up film. Is this true? Where will they
come from? How long will it be for? Will they come from reserves?
Frankly, I think it is good public relations, but at what price
in terms of over-stretch are these people going to be sent?
(Mr Balmer) The discussions we had with Mr Speilberg's
company ranged over a variety of facilities—both physical
and geographical facilities as well as people. As regards people,
the arrangement is that the personnel will all be volunteers from
the reserves and they will be paid in the normal way. So there
should be no impact—
309. In the normal way of film stars or in the
normal way the Territorial Army is paid, which is pretty miserable?
(Mr Balmer) The lucky ones will get better Equity
rates than others.
310. How long will this last?
(Mr Balmer) I do not know what the precise filming
schedule is. It is certainly some months.
311. That the exercising will last? Will they
be active reservists or amongst those whose services are being
dispensed with as a result of the SDR?
(Mr Balmer) No, they will be encouraged, principally,
from the TA.
312. Will this count towards their 25 days'
service a year?
(Mr Balmer) No, it will not.
Chairman: Even though they might see
some action for the first time. Having dispensed with that trivial
question we will move on to something a little more serious.
Mr Gapes
313. Can I take you to the memorandum you sent
us, on page 28, Table 30, in which the question was about the
unprogrammed costs and the impact that this had. Looking at that
table, it is clear that we have a memorandum which says that there
are 144 million pounds' worth of unprogrammed costs not covered
in this year's budget, but it does not include any figure for
the Kosovo operation for the current year. Are you in a position,
at this stage, to give us any estimates—not necessarily
a final one but as far as you can see, at this stage—of
the costs of Kosovo in the current year?
(Mr Balmer) I cannot give you a precise figure because
we are still assessing what it is. We have to put a figure in
for supplementary estimates during the course of February so that
we can get a total provision to cover the extra costs, and we
are presently debating with the Treasury exactly what that figure
should be, including a forecast for the remainder of the year.
The total, I would estimate, is going to be of the order of £400
million, maybe slightly less. That represents the extra cost in
the current year.
314. So that would mean that the additional
costs of unprogrammed operations this year will be substantially
higher than they have been for previous years, because it would
appear, from looking at the figures, that normally the figure
is around about £300 million to £400 million a year
for unprogrammed costs. This year will be substantially in advance
of that. Is that a fair point?
(Mr Balmer) Yes, that is right and that represents
the scale of the deployment to Kosovo—both the scale of
the air operation and, more particularly, the scale of the army
deployment.
315. From what you have just said, when will
you be making a claim on the contingency reserve?
(Mr Balmer) In effect, that debate, in principle,
has already taken place, and the Treasury agreed some while ago
that they would be meeting these extra costs. The debate we are
having now is over the detailed figure work, and it will be included
in the supplementary estimate in February.
316. So the actual figure will be made public
in February?
(Mr Balmer) The normal procedure is that an announcement
is made by way of an answer to a written question, and then we,
within a matter of days, submit the detailed supplementary estimate.
That will be during the course of February.
317. In the meantime, between the ending of
the military action in Kosovo and now, have you had to make any
cuts in order to stay within budget as a result of the extra costs
which you have incurred as a result of the Kosovo operation?
(Mr Balmer) No, because we have known for many months,
since the operation began, that the extra costs would be met,
additionally to our existing provision. So although we have not
agreed a total and we have not yet sought Parliamentary approval
for it, we knew both those things would happen so we have not
had to rein back elsewhere to accommodate those extra costs.
318. We are now in a position where we have
got UN operations, with coalitions of the willing, and we have
a history, over a number of years, of unprogrammed expenditure
on international operations, peace-keeping, peace-enforcement,
No Fly Zone and operations involving different parts of the services,
and you know that normally it is £300 million to £400
million but this year it is larger. Is there not a case for saying
that instead of going through this exercise all the time we should
actually bring into the budget from the Treasury every year the
sum of £300 million or £400 million in addition to what
the original defence budget is to account for unprogrammed and
unexpected expenditure?
(Mr Balmer) There is clearly a case for that approach,
but the drawback, from our perspective, would be that if we had
been allowed £400 million and we then found we got engaged
in an operation which cost considerably more than that, we would
have to rein back the budget elsewhere to pay the difference.
319. Or you could have gone to the Treasury
and said "It is the Kosovo operation, it is much larger than
normal, therefore can we call on the contingency reserve?"
(Mr Balmer) The way we are doing it at the moment
has the same effect. We agree, when an operation is launched,
that this will be of a size that dictates the need for extra provision,
and once we have the agreement that we will have our costs met
then it is no longer a constraint on the rest of the budget. We
conduct the operation, obviously we conduct it sensibly and tautly—we
do not waste money but pay what is necessary to be paid—knowing
that we will get the extra provision. We find this works. It is
easier to manage the rest of our budget once we have the confidence
that those extra costs will be met.
3 See p. 202. Back
4
See p. 202. Back
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