Ministry of Defence Annual Report and Accounts 2007-08 - Defence Committee Contents

Examination of Witness (Questions 140-159)


12 NOVEMBER 2008

  Q140  Mr Jenkin: The government found an extra 100% more money for the health service; it has found very much less extra money for defence.

  Mr Hutton: Defence spending has not increased at the same rate as NHS spending and that obviously is an aspect of decision making that we and everyone on the government side I think can reasonably defend. I think that is clear, given the state of spending in the National Health Service and the state of decline that we did inherit. In the context of the Ministry of Defence there have been very significant increases in real term resources. I do not want to be partisan unnecessarily today, they corrected the trend that we discovered when we came into office. Do the Armed Forces have all the resources they would like? I think the answer to that is no. Does any army, navy or air force anywhere in the world have all the money and resources it wants? Probably not. We have to make political decisions and I stand by them but I would not characterise—I do not think it is fair to characterise—our spending decisions as wilfully in the way you have described, to deprive the Armed Forces of the vital resources they need. In fact, if anything, from my experience of theatres when I have been there—I can say this in complete honesty, I am not putting words into anyone's mouth here—I spent the entire time in Iraq and Afghanistan trying to find people who would say that the kit is not good enough or the equipment they have is not good enough. I did not find many people who said that. My understanding is that has also been the experience of the Committee when it has been in these theatres too. I think it is important to have that on record. I believe that the forces that we have deployed to Iraq and Afghanistan today are better equipped and better provided for than they have been during recent years. On your point of are we using people's good will and good faith, we must not do that. I think part and parcel of the deal here has to be two-fold. One is that, when the circumstances allow, we have to take a foot off the operational tempo pedal and I am determined that we can do that; I think we will be able to do that next year. Secondly, we have to deliver on the promises we set out in the summer when we made a very conscious effort to make sure that the military covenant—this is a vital part of the whole deal here—is honoured in full. We look at the whole range of issues about pay, recruitment, retention, career prospects, accommodation and prospects for the men and women in uniform when they leave the Army, Navy or Air Force so that they can resume effective and profitable careers so no tuition fees, streamlined access to healthcare, schooling and so on. This is all part and parcel I think of the job of running the Ministry and we have to stick to it. I recognise that there is a deficit and there will be many people in the Armed Forces who would made the criticism that you have made of Government. What I would say to you and what I would say to them is that we are going to improve our performance in all these areas. My predecessor set out a very, very comprehensive range of measures that will allow us to do that.

  Q141  Mr Jenkins: I appreciate that some of the PSAs, particularly recruit, train, motivate and retain, are composites but we have an outcome, a final assessment of "partly met". I find difficulty with "partly met". Is it 90% partly met or 70% partly met? Do you not think in the interests of transparency if there was a figure in there we could know that next year if that figure goes up then we are improving. "Partly met" means nothing to me. I know it is a difficult task but would you like to go away and think about whether it is possible to give us some figures so we can see what improvements and progress are being made.

  Mr Hutton: I will certainly go away and think about that. If there is any more information or better particulars we can provide to the Committee of course we will do that. PSA five was a complex target—it had five subsets contained within it—and we fell short in particular in two very significant areas, one is in the Service Manning Balance and secondly in the Harmony Guidelines. We have to improve our performance in both of those areas. I can say to the Committee, particularly in terms of service manning, that we are doing pretty well. I think the numbers coming into all three services are running at a very high level, the highest since 2004. We are seeing not just an increase in the training strength but in the numbers of those joining the regular forces coming through training. The manning balance is better for the Royal Navy, it is better for the Army, it has slightly dipped for the Royal Air Force and we need to drill down and look at some of those issues. I think we are making progress. We are not making as good progress as we should be on the Harmony Guidelines but again it comes back to the priority that we attach to the operational target. That is our priority.

  Q142  Chairman: Would you give consideration to Brian Jenkins' point about assessing this with figures. [1]

  Mr Hutton: Yes. There are figures out there that I am sure we can reasonably share with the Committee. I would be very happy to do that if I can.

  Q143  John Smith: I can assess one of the targets with figures. It is a target that MoD has failed year in year out for the last ten years on the recruitment of ethnic minorities. In fact the targets are nowhere near achieved. As the new Secretary of State for Defence do you think it is important that we do recruit ethnic and other cultural minorities into the Armed Forces and the British Armed Forces should reflect the society that it serves?

  Mr Hutton: It is absolutely important that the Army, Navy and Air Force do reflect the society it serves. I agree very strongly with that. I think the figures are going in the right direction. The target we have actually set is to be realised in 2013 and that is to get to 8% ethnic minority representation in the Armed Forces. At the moment it is about 6.2%. The numbers are increasing but it is work that we need to continue to focus on.

  Q144  John Smith: You may or may not be aware, Secretary of State, given that you have not been in the post very long, but the figures you are using actually are the ethnic make up of the British Armed Forces drawing on Commonwealth recruits. The targets that were originally set after the Strategic Defence Review was the recruitment of British ethnic minorities, UK citizens. If you do have a chance to go back and have a look at that I think you will find it is an abysmal failure. We are not in the blame game in this Committee; what we aim to do is to try and address that issue.

  Mr Hutton: I am aware of the figures that I gave and of course the figures for UK ethnic minorities are 2.4%. We have to get to 8% by 2013 so that is the finishing line. We have not crossed the finishing line yet and the department will do all it can to make sure when we cross that finishing line in 2013 we have got the numbers up to 8% cent. It is going to take a significant effort to get there but all three service chiefs have assured me of their commitment to this goal and we are working together to try and achieve it.

  Q145  Linda Gilroy: Secretary of State, you referred just now to work in MoD headquarters and in the support and administration, however the administration of the MoD has been severely criticised by the Burton review in the wake of the serious data losses. There has also been the disastrous introduction of the JPA which was the result of poor decision making and the Cabinet Office's Capability Review concluded that there were weaknesses in the leadership of the MoD. What specific action are you going to take to improve these areas?

  Mr Hutton: I think the Permanent Secretary certainly addressed the issue of the failures of the JPA when he was before the Committee last week. I am not sure I have very much more to add to that. We have discovered a number of problems with JPA as the roll out has proceeded, not least of which some of them led to the qualification of the MoD's accounts this year which is very regrettable. I think those failures are to do with the quantum of auditable information that JPA generates which can form the basis obviously of the work of the NAO. We found that we did not focus enough attention on that. That is being addressed by the department and I hope we do not have a re-run of the qualification for that reason next year.

  Q146  Linda Gilroy: Does it surprise you that so little attention was paid to the way in which that would feed into the accounts?

  Mr Hutton: I was not familiar with the detail of JPA until about two weeks ago as I began to prepare myself for this session but yes, I think I was surprised. Hindsight is a very precious commodity in Ministerial life and I am not sure it actually adds up to very much, but I think the department is looking to try to address these issues. On the data loss point I agree, I share the frustration with everyone here and outside that we continue to lose personal data; this cannot go on. We are looking very carefully now and we have done a number of studies and projects. I know people say it is time we delivered on them and it is. We have to change the culture. We have to make sure that there is responsibility when data goes missing. We have to make sure our principal contractor takes greater responsibility for security of data. Work is in hand on all of those areas to try and tighten up performances. It is simply not acceptable for this kind of data to go walkabout, in particular when it jeopardises potentially the financial security and personal security of members of the Armed Forces; they expect better from us and we have to do better in this regard.

  Q147  Linda Gilroy: Last week I asked the Permanent Secretary about recommendation 38 which is to do with organising a coherent system of censure and punishment for those who lose or compromise personal data. Is that something that you will be paying attention to to try and change the culture as you have just said? Would that include Ministers if they were found wanting in that respect as well as officials?

  Mr Hutton: I think the Permanent Secretary is ultimately responsible for these matters in the department and it is his responsibility to make sure not just the sanctions and the disciplinary side of things that are appropriate, but to be perfectly honest I think the focus should be on making sure it does not happen and not dealing with the consequences when it does. I am content that the Permanent Secretary is taking the right measures in this regard and I am happy for him to get on and deal with it. As far as ministerial responsibility is concerned I think the Ministerial Code is very clear about this. If Ministers break the law, if they do not uphold standards of public life then there are issues for a Minister staying in post. One thing I have learned over the many years I have been a Minister is that whether a minister stays in post or not is ultimately a matter for the Prime Minister not myself. I think that any minister who found him or herself in a position where there had been a serious compromise of personal data, particularly involving the Armed Forces or found him or herself in the situation where there had been a breach of the data protection laws, I think their position would be pretty untenable.

  Q148  Mr Hancock: Can I ask, Secretary of State, are we now close to knowing what the true cost of JPA will be? Are you able to give us an assurance that the on-going costs of maintaining, updating it and getting it to function properly are not going to seriously take much needed resources away from other elements within the MoD's budget?

  Mr Hutton: I am afraid I cannot give you a figure today but I am very happy to follow that up with a letter to the Committee about the costs of JPA.[2] My understanding is that we are on top of all the difficulties associated with JPA and there are remedies in place to address the shortcomings. In the context of the resource implications I think it would probably be better if I took time to reflect on that and send a note to the Committee.

  Q149 Mr Hancock: That would be very helpful. Could I ask then what your opinion is on the basis of the way in which the MoD's planning assumptions are put together and how those assumptions currently interact with operational responsibilities? Is the way in which the planning assumptions are put together part of the difficulty in the MoD tending to lose out in the spending rounds when they come forward? Are you intending to change that at all?

  Mr Hutton: We have always got to look at the planning assumptions; we have to keep those under review and we do. Not wanting to restart the conversation we began with about how we all know we are outside of that box and already have been for many, many years, maybe I could usefully add one thing. I know Bill Jeffrey dealt largely with this point last week as well when he talked about the planning assumptions being designed to do exactly what they say do on the tin, they are designed to conform levels of force structure, what forces we need to deploy and the state of readiness of those forces. They are not designed to, as it were, provide an absolute limit and detailed actual pattern of operational commitment. They are designed to inform those who have the job of generating force structures and levels within the department. We have had to operate, as I said, in a different context for many, many years and the department has been able to expand and deal with that. As I said earlier, it cannot do that indefinitely without some fundamental give in the system. We have to get to a point where the actual level of our operational deployments come back within a reasonable spectrum. At the moment they are outside that spectrum and they cannot go on indefinitely being outside it. I am not critical of the process; I am not in a position to criticise that. Have we learned lessons? I think so. However, at the end of the day, going back to the point that Bernard made, the Ministry and the Armed Forces have to be able to respond to the requests that we receive. If it is Her Majesty's Government's priority that the forces deployed are of capable size and strength in Afghanistan we have to find the resources. Of course, strictly on the resources point, we have a longstanding agreement with the Treasury which predates this government and goes back decades about the net additional costs of operations being met by the reserve. That deal has stood and it has meant that nearly £10 billion of additional resources for us. Although in one sense the resources have been provided to meet the additional operational needs, you cannot in that sense buy your way out of some of the other problems of what the stretch in requirement has meant for the MoD in terms of people. Sometimes you cannot even buy a way out of that in terms of equipment either. I think you have to get this thing back in the box and that is what I want to see happen. I think the planning process itself, the planning assumptions, are perfectly reasonably. I am not aware that anyone has actually taken substantive issue with the planning assumptions that underpin the 2003 White Paper.

  Q150  Mr Hancock: We have as a Committee. I think it came as a surprise to the majority of the Committee and a disappointment to many of us that your predecessor said he did not foresee any real radical change in those assumptions. You are new in the post, are you prepared to look again at how you actually bring operational requirements and planning assumptions closer together so they actually do reflect the true needs of the MoD in the future?

  Mr Hutton: I think there are some things that need to be disaggregated there. I do not think there is an easy yes/no answer to that question to be fair. As my briefing notes always consistently remind me, I am new in post so I want to take time to think about what my response to the detail of that question is. I am not going to say yes or no to that today because I have not had time to properly go into all this. I think the question about getting force structures more in line with operational requirements, how we manage the demand on the men and women of the Armed Forces, we are going to make progress on that next year. I believe that fundamentally. As I said earlier, we will be able to turn a page on getting resources, people and commitments back into line. That will not be as a result of a change in planning assumptions; that will be the result of a change in operational requirements. I have a very strong feeling, a month into this job, that that is always how it is going to be. I think you can twiddle about with the planning assumptions for a very, very long time indeed but you always have to recognise that something might happen in the world; something is going to happen to change those planning assumptions. That is the nature, I suspect, of military strategic planning here and right the way round the world. It is being able to retain that flexibility, that is the key thing, and that does underpin the planning assumptions themselves and I think successfully so.

  Q151  Mr Jenkin: To return to a previous theme, it has been happening in the world for the last six or seven years and I would invite you in your consideration of your new responsibilities to consider this, that in fact the foreign security strategy of the UK is very much more militarist than your defence planning assumptions allow for. Has it not got to the point where we must stop hoping year after year that there is going to be a relaxation in the tempo of military operations and we should start planning for what has been happening for a period longer than the Second World War?

  Mr Hutton: We do a lot of that type of thinking and planning in the department.

  Q152  Mr Jenkin: It needs to be beyond the department, does it not?

  Mr Hutton: It needs to be cross-government, I accept that. We do look at all of these things. To answer the specific question you have raised, the advice that I receive is that although our Armed Forces are stretched—as they palpably are—we are able to sustain our current level of operational deployments. That is the first thing I want to say. We are not in that sense incapable of sustaining these operations. If that were the case we would be talking in very different terms, it would be a very different sort of debate. Can we go on doing that indefinitely? As I said and I have made myself very clear, no we cannot. There will have to come a point in time, sooner rather than later, where there is a rebalancing. I think that will come next year and that will be welcome. However, I think the wider point I suspect you are hinting at is, is this time for a strategic defence review because that is essentially I think the logic of where your question is going. On that too I do not want to be drawn in any great detail today. You can try your best but you will not get me to comment in any more detail other than this, that I think, certainly in the short term, we have to make clear that we can live within our existing resources in the CSR. That is partly what the equipment examination programme is designed to help us achieve and I hope to be in a position soon to be able to make some announcements about that. Looking beyond that my perspective is this: I think we should reflect very carefully over the next few months about those issues. We need to make sure that we have the right long term agenda and perspective. I am going to consider all those points very carefully. The final point of your question, has our foreign policy become overly militaristic—

  Q153  Mr Jenkin: I am just saying it is more militaristic than has been planned for; I am not saying that is wrong.

  Mr Hutton: That is a very important clarification because I got the sense that you thought we were using military force inappropriately. I think, again with very great respect, the bottom line is probably this, as I said a few minutes ago, that you have to be able to respond sometimes to circumstances that are outwith your planning assumptions. That is the nature of life and that is the nature of the Armed Forces. We have had to be able to do that and we have had the capability and flexibility to do that over five or six years but it is not an indefinite capability because as you rightly say—and the Committee has drawn attention to it before—we are not resourced indefinitely to do that. We will have to come to a point where there is a better balance between the resources and commitment and equipment and people. We are not in balance yet. I am no great historian on this point but I am not sure whether you would ever get consensus in the post-war period that there has been that strategic balance. I remember a defence debate under the last government where many were arguing that we did not have such a balance then. We probably do not have such a balance now but I think the important point to focus on is, as we have tried to do in this report and in my argument today to the Committee, what our forces are capable of doing when they have to do it. As I said at the beginning, that is the focus of what I want to deal with in my time as secretary of state.

  Q154  Chairman: Secretary of State, one thing that came out of that interesting reply was that I got the impression that when you talked about a strategic defence review you were not saying that you were opposed to the idea in principle. Are you opposed to the idea in principle or do you just want to leave that on the table for further consideration?

  Mr Hutton: I do not think this is the right time for it. That is what I would say. I think we need to focus on the here and now. I am content with the overall positioning of defence strategy at the moment. We have a growing resource envelope but an increasing ambition as to the areas in which we should spend it. We have to get all of that back into balance. I am not arguing for a strategic defence review now. Could I rule it out at any point in the future? Of course I cannot because I am not able to bind my successors.

  Q155  Mr Jenkins: With regards to all the planning assumptions and everything else we are going to do with reviewing our commitments, you used the term we should be able to get it back in the box. What if, realistically, you come to the conclusion that we cannot get it back in the box, we need to buy a bigger box. Is it not about time that as a government and a nation we faced up to the fact that we cannot put this back in the box? Do we need a bigger box?

  Mr Hutton: Again I do not want to re-run the argument about the costs of operations because the costs of operations are in addition to the comprehensive spending review and the accounts that we presented before the Committee and we are debating today. Over the last few years that has come to £10 billion of additional defence spending. I think there would be a serious problem for the country and for the Armed Forces if the net costs of operations had to be met from within the MoD's budget. That would obviously be an unsustainable position but it is not where we are and we will not be in that position. I think the cost of operations is one thing and I am not worried about that. What I am worried about, as I tried to say earlier, is the impact on the men and women of the Armed Forces of maintaining that type of operational tempo. There, I believe, we have some genuine issues to address and that is why it is very important that there is this rebalancing. I think next year we will be able to do a great deal of rebalancing as the operational deployment in Iraq comes to an end.

  Q156  Linda Gilroy: As well as being concerned, rightly so, about the impact on our personnel, are you also concerned that we are at that point where the flexibility that you also set so much store on, and rightly so, begins to be at stake? I am thinking there of things like maintaining a flexibility to respond to piracy in Somalia, the recent change in the posture of Russia, so things like the training that is required to maintain paratroopers, anti-submarine warfare, naval flight personnel etc and their training. Is that something that is also on your horizon to have in consideration?

  Mr Hutton: Yes, we have to look at all of those things. I think you have identified all the important issues there. We have talked about the readiness and ability to deploy for contingent operations and the PSA timeframe, in fact we have not met the levels of deployability that we would have liked. We were able, nonetheless, to commit resources to the anti-piracy mission in Somalia. Over the summer we deployed the reserve battalion to Kosovo. We are able to continue to meet a range of other operational requirements outside of Iraq and Afghanistan. That again is a tribute to the planners and the men and women who actually go and do these jobs. On the training point, again I tried to refer to this earlier, I think this is an issue of very real importance. The natural consequence of the very heavy focus on Iraq and Afghanistan has been that we have increasingly focussed on training for those two theatres and it is very, very clear to me that we need to maintain the right level of capabilities across a range of disciplines and a range of areas that are actually not theatre specific. You mentioned anti-submarine warfare interests. Personally I think this is going to be an increasing issue. We have already seen signs of the need to improve our training and operational deployments in those areas and I think that is something we will have to focus on too. You mentioned the RAF and pilot training, that too has been focussed on in theatre. I think we have to be very careful that we keep a wider range of skills and talents properly developed, including the ability to land and take off from carriers for example. All of this has to be factored into the mix.

  Q157  Mr Jenkin: Secretary of State, a few minutes ago you said you had to be able to respond and yet it is your readiness targets which you are missing. The PSA target last year: not met, partly met, partly met, and this year: readiness for contingent operations declined. I sense that this is one of your priorities, to improve readiness. The DSOs that are being introduced are actually reducing the readiness of some aspects of our Armed Forces to make it easier to fit into the financial envelope. Last week Mr Woolley told us, "What we have done is reconstructed the measure to make it more realistic" and he added, "we have relaxed the required readiness state of some of our Armed Forces".

  Mr Hutton: Yes.

  Q158  Mr Jenkin: This is doing exactly what you say you should not be doing. You are not going to be in a position to respond.

  Mr Hutton: I think I have tried to set out the fact that we have been able to respond when it has been necessary to provide additional forces for additional roles. I highlighted two of them a second ago. It is true that levels of readiness amongst some units have been adjusted and have been relaxed, that is true. That has been happening for some time and that is of course one of the ways that you calibrate for risk and how you match resources to your operational priorities. It is a judgment, not a judgment that I make—let me be quite clear about this—but this is a judgment that my military advisors present to us. Speculating and arguing about whether people would like high levels of risk and readiness, I think the answer—although I have caveated it already by saying we should not speculate—is probably yes they would. This is something we can turn to and address during the course of the next period as we release some of the operational tension from the system with the draw down in Iraq. I think the balance always has to be a carefully struck one. I remain confident that we are able, if necessary, to make additional responses to meet additional security challenges that affect the vital security interests of the United Kingdom and we have demonstrated I think on a number of occasions our ability to do that. Iraq and Afghanistan have not made it impossible to respond to the right level of need for the deployment of UK forces. Have they made it harder? Yes.

  Q159  Mr Jenkin: Were we faced with the need for a major civilian evacuation operation from the Balkans, for example (which is something that was exercised earlier this year) or a rogue state invading a sovereign state (something that has happened twice in my lifetime where British Armed Forces had to respond) we would simply not be able to respond. You said a little while ago that there is no magic lever but there is actually one lever which the government refuses to pull which is to increase the funding for the Armed Forces so that the resources actually match all the demands and the required readiness which the government's own defence policy says is required.

  Mr Hutton: We have provided significant additions for the Armed Forces and I think it is far too sweeping a generalisation to make to claim today that we would not be able to respond in a way that you have suggested we should to those kinds of major events. I would prefer, again with very great respect, to take the advice of my military commanders about that rather than a member of the Committee. The advice that I do receive and continue to receive is that although stretched the Armed Forces retain very, very capable Armed Forces. I do not doubt—partly because we have the benefit of strong strategic alliances through NATO collective security and other strategic partnerships—that we retain the ability to defend ourselves and that front and centre is the foremost responsibility—

1   See Ev 46 Back

2   See Ev 47 Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2009
Prepared 30 March 2009