Memorandum from the Ministry of Defence
1. The Government's primary responsibility
is to ensure national security. The Coalition Partnership Agreement
and the Queen's Speech set out the Government's commitment to
holding a full Strategic Defence and Security Review (SDSR) alongside
the Spending Review, with strong involvement of the Treasury.
It is overseen by the National Security Council (NSC) alongside
development of a wide ranging National Security Strategy (NSS).
The combination of the SDSR and NSS will provide a coherent approach
to security across Government and ensure the right balance of
resources to meet our commitments. It is a fundamental objective
to ensure that our Armed Forces have what they need to do what
is asked of them.
2. The approach being taken by the NSC involves
analysis of national security policy and capability across all
relevant Government Departments and agencies. For this reason
the Review is being led from the centre of Government, the Cabinet
Office working with the Treasury. Defence capabilities and resources
are accordingly being considered alongside all other security
capabilities in order to measure the relative cost effectiveness
of each. Cost effectiveness of capabilities will be measured by
what they offer and how effective they are at addressing the defence
and security challenges of the 21st Century. This will enable
Ministers to consider relative priorities across all national
security capabilities in an integrated way. Depending on the outcome
of the SDSR, some national security capabilities may be reduced
to enhance others if that provides the most effective means of
protecting the UK's national security interests. The Review will
conclude in the autumn in parallel with the Government's Spending
Review. Its conclusions will be published in a pan-departmental
White Paper.
3. The Government is committed to playing
a leading role in making the world safe from the dangers of nuclear
weapons and nuclear proliferation. The recent Nuclear Non-Proliferation
Treaty Review Conference was an important milestone in the long-term
vision of a world without nuclear weapons, providing a map to
help us move forward. In May the Foreign Secretary announced that
we would review the circumstances in which the UK might use nuclear
weapons and made public for the first time the maximum number
of nuclear warheads we hold in our stockpile to assist in building
a climate of trust between nuclear and non-nuclear weapons states.
This goes further and is more transparent than any previous Government.
The Government does not, however, judge that this is the right
time for the UK to give up its minimum nuclear deterrent. Within
the framework of the SDSR the MoD is scrutinising the renewal
of our Trident-based nuclear deterrent. This is a value-for-money
study reviewing existing plans. It is not a review of all the
possible alternative ways to provide nuclear deterrence. MoD work
on this should be completed by the end of July for subsequent
consideration by the NSC, and its conclusions will inform the
SDSR and the Spending Review, the conclusions of which will be
published in the Autumn.
THE NATIONAL
SECURITY COUNCIL
4. The new NSC provides high-level strategic
guidance to Departments, co-ordinates responses to the dangers
we face, and identifies priorities. It is chaired by the Prime
Minister and meets roughly weekly. Other members are the Deputy
Prime Minister, the Chancellor of the Exchequer, the Secretary
of State for Foreign and Commonwealth Affairs, the Home Secretary,
the Secretary of State for Defence, the Secretary of State for
International Development and the Security Minister in the Cabinet
Office. Other Cabinet Ministers, the Chief of the Defence Staff,
Heads of Intelligence Agencies and other Senior Officials attend
as required. The work of the NSC is co-ordinated by the National
Security Advisor, Sir Peter Ricketts (formerly Permanent Secretary
at the Foreign and Commonwealth Office), who chairs a weekly Permanent
Secretary-level official group, the NSC(O), in advance of NSC
meetings, and is supported by the National Security Secretariat,
based in the Cabinet Office.
5. In addition, specifically to oversee
the work of the SDSR, the National Security Adviser chairs a Strategic
Reviews Steering Board, also at Permanent Secretary level. This
is supported by a lower-level pan Departmental SDSR Coordination
Group that meets as necessary to deal with issues that do not
need to come to the Strategic Reviews Steering Board or the full
NSC. Within the National Security Secretariat a division of about
30 people has been established to lead the SDSR, including military
personnel, and civil servants from the MoD, the Foreign Office,
DfID, the security and intelligence agencies and the Treasury,
seconded for the duration of the Review. It comprises six teams
covering:
— project management, responsible for overall
planning and coordination;
— defence, headed by an Air Commodore;
responsible for liaison with the MoD and the delivery of defence
inputs to the National Security Strategy and SDSR;
— nuclear and arms control issues including:
— counter proliferation, arms control and
chemical/biological/radiological/nuclear response,
— deterrent value for money,
— security issues, coordinating input on
cross-cutting security issues including:
— fragile/failing states,
— energy and climate security,
— serious organised crime,
— key policy choices, responsible for defining
key pan-Government policy choices and trade-offs including:
— multinational cooperation,
— conventional deterrence and coercion,
— military assistance to the civil authority,
— legal and social constraints,
— resources, responsible for liaison with
HM Treasury to ensure alignment with the Spending Review, analysis
of budget positions and options, and development of the resource
framework (including options for reserve and pooled budgets).
MOD PREPARATORY
WORK
6. The MoD started preparing for a Defence
Review in late 2009 following the commitment by all three main
political parties to a review following the General Election.
Preliminary work focused on setting out the strategic context
in which the Review would take place and establishing some of
the strategic questions it would need to answer. These were set
out in the Green Paper (Adaptability and Partnership) published
in February 2010 under the last Government with cross-party support.
It set out several key principles:
— That the Government will continue to
need to act abroad to tackle threats at their source, and to intervene
to protect the UK's interests overseas.
— The need to strengthen a comprehensive
and effective approach across Government, with stronger co-operation
between military, stabilisation, development and diplomacy efforts
across Government to apply civilian and military effect together.
— The need to strengthen partnerships to
enable us to work together more quickly and more effectively with
a more diverse group of allies, including in Europe.
7. Between publication of the Green Paper
in February 2010 and the General Election in May the Department
followed a twin-track approach. The first comprised a range of
preparatory studies of issues, flowing in the main from the Green
Paper. Given their preparatory nature they did not seek to address
key questions or reach conclusions on Defence outputs, force structures
or capabilities but sought rather to compile baseline data for
the Review and explore the case for further work. The main areas
examined were:
— Personnel, training and welfare (including
Service personnel policy, the independent review of defence civilian
personnel conducted by Mr Gerry Grimstone, individual training
and education, and medical services).
— Infrastructure and support arrangements
(including the scope for estates disposals, and estate management
arrangements).
— Key force generation factors underpinning
overall personnel numbers and equipment holdings relative to the
forces we are able to deploy.
— Organisation and management (including
preliminary work on defence administration costs and on the single
Service command structures).
— Security policy (including on the defence
contribution to influence and strategic communication and to arms
control and counter-proliferation, military assistance to the
civil authority, horizon scanning, and the UK's contribution to
NATO, the EU and the UN).
— A limited number of studies into specific
capabilities (including cyber, space, and missile defence).
In parallel, the Department maintained its engagement
with the wider Defence academic and specialist community to ensure
that we continued to draw on that external expertise and encourage
participation in the debate.
8. The Department also worked on developing
modelling and costing techniques, reviewed its strategic planning
process and methodology to put in place a streamlined system to
support the Review and its implementation, and conducted studies
to understand the financial and industrial consequences of making
changes, particularly to the equipment programme.
DEFENCE WITHIN
THE SDSR
9. The Secretary of State for Defence, Dr
Liam Fox, set work in hand on the Defence contribution to the
SDSR immediately on taking office on 12 May. He has stated that
the UK's defence must be based on a clear definition of our strategic
interests, an assessment of our role in NATO and other partnerships,
the threats we face, the military capabilities we need to protect
our interests, and the programmes we need to deliver those capabilities.
This should take into account the many things the Armed Forces
can do to promote the national interest and support Government
policy more widely. The primary function of the Armed Forces,
which can be provided by no-one else, is in the last resort to
fight and kill in defence of the UK should that be needed. As
a result of that capability they are also able to dissuade aggression
by deploying military force to deter and contain threats, and
the SDSR will take a fresh look at how we might do this better.
10. Reflecting these parameters, three core
principles underpin the work being taken forward in the Review:
— Relevance: Defence posture and capabilities
must be relevant to the world we live in. The SDSR represents
the opportunity to dispense with much of the legacy of the Cold
War.
— Realism: resources are tight for the
country as a whole and Defence is no exception. We cannot insure
against every imaginable risk so we will need to decide which
risks we are willing to meet and which risks we are willing to
take.
— Responsibility: the nation has a duty
to support the members of the Armed Forces in return for their
service on our behalf. In recognition of the demands that the
country places on them, the Government is determined to ensure
that they have what they need to do what we ask of them, and that
they and their families are looked after properly during and after
service. In particular it is committed to improve the package
of welfare and health care, particularly in the area of mental
health, and to make improvements to accommodation wherever possible
within budgetary constraints.
11. Defence is not immune from the economic
realities the country faces. In every aspect of Defence, and particularly
in the support area, the Government will bear down on costs, seeking
improved value for money and greater efficiency wherever possible.
This will include following through on its commitment to reduce
the MoD's running costs by at least 25%. But the current programme
is unaffordable, with a deficit of many billions of pounds over
the life of this Parliament, and more over the next decade. A
number of structural pressures exacerbate the situation including
the trend of above inflation pay increases and the increasing
cost of successive generations of equipment. Moreover, contractual
and structural commitments on personnel and equipment mean that
the current Defence budget is heavily committed for several years,
severely limiting the Department's room for manoeuvre. In this
context, no matter how hard we bear down on the costs of administration
and drive up efficiency, these alone cannot bridge the gap; the
problem is structural and will require a structural response.
12. The Government is determined to bring
Defence policy, plans, commitments and resources into balance,
and produce over time a transformative change to the UK's Defence.
Restoring Defence to a stable financial footing in the SDSR and
Spending Review will therefore require radical thinking and reform.
In the context of the SDSR the Government will review all that
the MoD currently does, including the organisation and structure
of the Department, each of the Services and the support area.
At the heart of this work is a thorough examination of the force
structure, looking at the overall shape, size and role of Armed
Forces personnel, including the Reserve Forces, and MoD Civil
Servants. This will ensure that Defence resources match the UK's
Defence policy requirements, and that the Defence budget is spent
as efficiently, effectively and economically as possible. This
will require tough decisions that will impact on many areas of
the Department and the Armed Forces. There will inevitably be
reductions in some areas in order to enhance others and provide
the most effective range of capabilities to defend the UK's interests.
13. It is essential that the Armed Forces
are re-configured to meet the needs of the evolving security environment
and the UK's foreign policy goals. Within the overall framework
provided by the NSC the Department is taking forward a range of
detailed studies on specific capabilities and force structures
(paragraphs 16-17). Early thinking, building on the work of the
Green Paper, suggests that the Armed Forces are likely to need
to be more agile and adaptable and potentially less focused on
specialist scenarios; more mobile both strategically and tactically;
and more fully integrated across land, air and sea with improved
access to Intelligence, Surveillance, Target Acquisition and Reconnaissance
capabilities. On the other hand, they are likely to have a smaller
requirement for non-precision firepower, be less focused on scale
when contributing to multinational operations with the emphasis
moving to quality, and bearing down on those capabilities held
in large numbers by NATO allies. The Government will begin to
reach conclusions only as our strategic posture becomes clearer
and we can test our work against the agreed policy baseline to
produce a synthesised force structure and risk assessment. Emerging
conclusions will begin to be considered by the NSC from late July
and August onwards
GOVERNANCE AND
PROCESS WITHIN
THE MINISTRY
OF DEFENCE
14. The Secretary of State has established
the Defence Strategy Group (DSG) to provide top level oversight
of the programme of Defence work in support of the SDSR. It is
chaired by the Secretary of State, and includes other Defence
Ministers; the Chief of the Defence Staff; the Permanent Secretary;
the Chiefs of the Naval, General and Air Staffs; the Vice Chief
of the Defence Staff; the Second Permanent Secretary; and the
Directors General for Strategy, Finance and Security Policy.
15. Beneath the Secretary of State and the
DSG the Director General Strategy, Mr Tom McKane, is the Programme
Director for the SDSR within the MoD, responsible to the Permanent
Secretary for delivering the MoD input into the SDSR as directed
by the Secretary of State. He is supported in this by the SDSR
Programme Board, which he chairs, The Programme Board meets weekly
to review the management of the programme and its risks, provide
guidance, and consider emerging papers and work. It comprises
the Directors General for Finance, Security Policy, Human Resources
& Corporate Services, and Defence Commercial; the Deputy Chiefs
of the Defence Staff for Capability and for Personnel; the Assistant
Chiefs of the Naval, General and Air Staffs; the Director(Strategy
and Resources); and the Assistant Chief of the Defence Staff(Strategy
and Plans). Day to day management of the SDSR process within the
MoD is carried out by the Strategy Unit reporting to the Strategy
Director.
16. The MoD programme of work under the
SDSR has six overlapping phases:
— Phase 1—Policy Baseline comprises
the MoD contribution to the NSC's work to develop the NSS, setting
out the Government's foreign and security policy priorities, the
national interests, the threats we face, and the broad implications
for Defence, to inform the consideration of military capabilities
and force structures.
— Phase 2—Detailed Policy and Capability
Studies comprise a set of detailed studies of current and projected
capabilities, structures and processes against the emerging security
baseline (paragraph 17), creating a menu of options for investment
or disinvestment for Ministerial consideration.
— Phase 3—Force Testing comprises
work to look at the effectiveness of possible future force structures
against a range of scenarios. A series of Military Judgment Panels
are meeting over the summer, drawing on high level operational
analysis. Their conclusions will then be developed through further
force structure modelling and analysis conducted by DSTL, with
the subsequent conclusions subjected to structured senior review,
overseen by the Vice Chief of the Defence Staff. This will generate
top level military judgment on the robustness of force structure
options which might emerge from the Review.
— Phase 4—Synthesis and Costing will
reconcile and synthesise the outcome of the previous phases, balancing
requirements against cost envelopes and assessing overall affordability,
to produce a synthesised force structure and risk assessment against
the policy baseline in the early autumn, taking into account the
financial context set in the Emergency Budget and wider SDSR and
Spending Review processes.
— Phase 5—Decisions and Presentation
will consist of final decisions in the autumn by the NSC, in coordination
with the Government's decisions in the Spending Review. We expect
the results of the SDSR to be published through a White Paper;
on which the National Security Adviser will lead.
— Phase 6—Implementation. All decisions
made as part of the SDSR will require a clear, resourced implementation
plan. Implementation planning will begin in the autumn and continue
into 2011. A key element of implementation will be the new Defence
Strategic Direction document, which will translate SDSR outcomes
into detailed direction for the Department, and the range of supporting
sub-strategies.
17. Studies. The MoD is currently engaged
in some 40 individual policy and capability studies. Each is led
by a named senior officer or official with overall responsibility
for delivery of the study. Arrangements are also in place to gather
together emerging recommendations or proposals on functional lines
(such as estates, military personnel, and civilian personnel).
All of these studies are contributing to the pan-Departmental
work led by the Cabinet Office. The majority are grouped under
the 10 broad themes below:
— Military Training And Personnel:
— Service Personnel Employment Model.
— Government commitments on the military
covenant.
— Individual Training, Education and Skills.
— Civilian Personnel And Training:
— Review of civilian allowances.
— Organisation Of Defence:
— Rationalisation of warfare centres.
— Rationalisation of service administration
(such as manning, legal, chaplaincy etc).
— Unified Information Exploitation organisation.
— Review of the Organisation and Management
of Defence (paragraph 21).
— Military Assistance to the Civil Authority.
— Technology And Industry:
— Size and priorities of the Science and
Technology budget.
— International Partnership And Basing:
— Multinational Cooperation.
— Requirement for Overseas Basing.
— Legal and Societal Constraints.
— Conventional Deterrence, Coercion, Containment
and Prevention.
— Infrastructure And Logistics:
— Rationalisation and Development of Future
Estates.
— Management of Defence Infrastructure.
— Force Generation, Adaptability And Deployabilty:
— Tour Lengths and Harmony.
— Reduction in Running Costs (paragraph
18).
— Media and Communications Running Costs
Savings.
— Force and Platform Protection.
— Simulation, Training and Evaluation.
— Underwater Environment.
— Command, Control, Communications and
Computers/Intelligence, Surveillance, Target Acquisition and Reconnaissance.
— Force Structure And Capabilities:
— Maritime Environment Force Structure
and Capabilities.
— Land Environment Force Structure and
Capabilities.
— Air Environment Force Structure and Capabilities.
We are also conducting studies into Special
Forces, and cyber warfare, which do not fit within this overall
structure, to provide Defence input into Cabinet Office-led work.
Separately, but within the framework of the SDSR, we are conducting
a value for money review of existing plans to renew the Trident-based
nuclear deterrent (paragraph 3).
SPENDING REVIEW
18. The SDSR is running in parallel with
the Government's Spending Review to set Departmental budgets and
objectives for the next four years. Work on both of these is being
taken forward in a coordinated fashion to ensure that the Spending
Review is informed by emerging conclusions from the SDSR and that
the SDSR work is informed by the progress of the Spending Review.
In the Spending Review all Government Departments are expected
to reduce administrative spending by at least one third, drive
down the cost of operational delivery and promote greater responsibility
by shifting power, funding and accountability into the hands of
individuals and front line professionals who are often better
placed to allocate limited resources. Several of the detailed
MoD SDSR studies are also contributing to this. In particular,
the Reduction in Running Costs study will aim to identify how
we will achieve the running cost reductions required.
OTHER RELATED
DEFENCE ACTIVITY
19. The Department is also taking forward
a number of other major continuing reform programmes. These fall
within the broad pan-Government context set by the SDSR and the
Spending Review. But they are not part of those Reviews and will
continue beyond their conclusion. This continuing work falls broadly
into the categories of Acquisition and Organisational Reform.
20. Acquisition Reform. The Government intends
to carry forward major reform of Defence procurement practices.
The Secretary of State for Defence has indicated that the need
to focus in the next few months on Afghanistan and on the SDSR
may mean not focusing on acquisition until the turn of the year.
In the meantime the Department is continuing to implement its
Defence Acquisition Reform Programme.
21. Organisational Reform. The Government
is committed to reducing the MoD's running costs by at least 25%,
and in the Spending Review all Government Departments are expected
to reduce administrative spending by at least one third (paragraph
18). The SDSR will impact on how defence is structured and organised.
The Secretary of State for Defence has set out the need to reorganise
the Department into three pillars (for strategy and policy, the
Armed Forces, and procurement and estates) with a more efficient
and leaner centre where everyone knows what they are responsible
for and who they are accountable to, with clear deadlines and
budgetary discipline. This is being taken forward by a dedicated
Defence Reform Unit in the Head Office. This work will proceed
on a separate track with a view to completion by next summer,
though early high level findings may be woven into the SDSR. Implementation
of a number of existing long-term organisational change programmes,
such as the collocation of Defence Equipment and Support project
management staff at Abbey Wood, and the consolidation of the Army's
Headquarters at Andover, is also continuing.
INTERNAL ENGAGEMENT
22. We are providing the opportunity for
all members of the Armed Forces and their families, and the Defence
civilian workforce, to contribute to the Review during July. Recognising
that the SDSR and Spending Review are a source of uncertainty
for all our staff, military and civilian, we are working to provide
as much information as possible to them as the Reviews progress.
We are also engaging the Trades Unions, and will of course consult
them formally on any provisional conclusions with significant
implications for the civilian workforce.
EXTERNAL ENGAGEMENT
23. We are engaging widely through a number
of different strands including:
— Parliament: the Secretary of State for
Defence has stressed the importance he attaches to providing Parliament
with information Members of Parliament need in order to make representations
to the Review. The Government accordingly arranged a full day
debate on 21 June to allow Members to set out their concerns and
any particular constituency interests. Individual Members can
make representations directly to the Secretary of State as a matter
of course.
— Public: the MoD is planning to inform
the public primarily through engagement in Parliament, with Defence
academia, and through the general and specialist press. We are
also receiving and responding to submissions directly from interested
members of the public and organisations.
— Industry: the MoD is engaging with the
Defence Industry primarily through the National Defence Industries
Council.
— Allies and Partners: the National Security
Adviser is coordinating consultation with key Allies and partners.
— Academia: the security and defence academic
community have an important role in generating ideas and shaping
the public debate, and the MoD continues to engage this group
both directly and through participation in wider conferences,
such as the series on the SDSR organised by the Royal United Services
Institute.
8 July 2010
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