Written evidence submitted by Professor
Trevor Taylor, Royal United Services Institute
Given the Government's commitment to reduce
significantly the budget deficit, the settlement for defence was
as good as could have been expected. Spending is to be cut in
real but not cash terms, the real cut is just 7.5% over the whole
period and until 2013-14 the MoD can enjoy virtually level real
expenditure.
A key question is whether the combination of
the Comprehensive Spending Review with the Strategic Defence and
Security Review has generated an affordable defence programme
for the foreseeable future. The pre-SDSR widely reported over-commitment
in defence plans stemmed in part from reluctance by Labour Governments
to abandon struggling projects and a readiness to defer many schemes,
including plans for the introduction of the two aircraft carriers.
However we should not overlook that the projects kept from before
1997 and those adopted later reflected the demands of an ambitious
policy. This was set out in 1998 and increased in scope incrementally
thereafter, under which UK forces were required to be ready to
undertake a range of roles on the global stage. The Conservative-Liberal
Government has to date been unwilling to scale back significantly
the scope of this policy. To offer two illustrations, Foreign
Secretary Hague said in Brussels on 15 October that the UK would
remain a military power "of the first rank" with "flexible,
highly deployable forces"[6],
while the Prime Minister's Foreword to the SDSR document spoke
of the UK's "global responsibilities and global ambition".
It is hard to conclude that the programme adopted
in the SDSR is affordable beyond 2015, indeed the Prime Minister
as good as recognised this when he told the House of Commons of
his "strong view that this structure will require year-on-year
real-terms growth in the defence budget in the years beyond 2015".
Even before then, there is risk in the MoD's many savings plans
for the sale of assets and reductions in head counts, not least
of more than a quarter of all civil servants posts. It may well
be that Lord Levene can come up with changes to the MoD's organisation
and ways of working that mean that many tasks can be abandoned.
However, if the MoD's processes are not changed drastically, staff
cuts will mean either that those remaining will be overwhelmed
with work or that more tasks will be outsourced to the private
sector. The private sector will expect to be paid. On the nuclear
front, where it is clear that the MoD is struggling to conceive
how the Trident submarine system could be replaced within the
confines of even a defence budget that is level in real terms,
the SDSR asserts the savings to be made from deferring warhead
replacement programme and reducing the envisaged size of the missile
compartment in the replacement submarines. However this is an
area where there are many fixed costs.
In making adjustments to the CSR for the next
four years, the MoD faces the problem that, as the NAO has underlined[7],
75% of its budget next year is already committed and that share
does not fall sharply in the following few years. In an era where
the outsourcing of defence (and public sector) needs to the private
sector is viewed as sensible, it must also be recognised that
there are good reasons why long-term contracts with the private
sector have often been concluded. The result today is that the
MoD is being pressed into introduced cuts where they can be made
rather than they need to be made, and the result will inevitably
be a degree of defence incoherence: equipment being present but
training money being absent and so on. This is most apparent with
regard to maritime air but it must be expected to occur elsewhere.
The MoD's press release on the SDSR implicitly accepts this when
it notes that a review priority was "to make sure that we
emerge with a coherent defence capability in 2020"[8]
(this author's emphasis). The policy guidance means that the conduct
of the Afghan operation (for which there is separate funding)
and the maintenance of one high-readiness brigade will have a
high claim on resources.
The SDSR of 2010 should not be compared with
the 1998 exercise SDR because the latter sought to identify and
introduce important improvements to the MoD's structures and processes:
the creation of the Defence Logistics Organisation, the Equipment
Capability Customer and the Permanent Joint Headquarters were
examples. The five months allotted to the SDSR process was insufficient
for any similar effort, hence the separate treatment of a Defence
Industry and Technology Policy and of the Defence Reform effort
under Lord Levene.
Clearly there is always potential for increased
efficiency in an organization as large as the MoD, but some changes
have significant implications and will take time to introduce.
If it is concluded that there are too many officers at Lieutenant
Colonel rank and above (and their air force and naval equivalents),
cutting their number implies a different offering to officer recruits.
They need to be told of reduced chances for promotion and even
that they should not think of a career in uniform beyond the age
of 48. Currently much internal defence effort goes on checking
("scrutinizing" and "assuring") the work of
colleagues but significantly reducing this would require very
extensive culture change and would not be risk-free. It would
need to be accompanied by a significant training and education
effort. The armed forces remain in essence three separate and,
in the face of severe resource shortages, rival groups: increasing
their integration could well save money but it would again mean
cultural change and political resistance. Lord Levene's task is
not straightforward.
But even an impressively efficient MoD cannot
be expected to generate broad-spectrum, flexible armed forces
comparable in standard with those of the US, with the government
having a significant degree of "operational sovereignty"
over how and where they will be used, on a budget that accounts
for a little over two per cent of GDP. Before too long the UK
will need to change either the scope of its policy ambition or
the money it makes available for the armed forces.
November 2010
6 "Britain will remain military power of `first
rank', says William Hague", Daily Telegraph, 15 October
2010, http://www.telegraph.co.uk/news/newstopics/politics/defence/8066161/Britain-will-remain-military-power-of-first-rank-says-William-Hague.html Back
7
Report of the Comptroller & Auditor General, Strategic
Financial Management of the Defence Budget, London, 21 July
2010, p.5, http://www.nao.org.uk/publications/1011/mod_financial_management.aspx. Back
8
Ministry of Defence, "Strategic Defence and Security review
published: a Defence Policy and Business News article", 19
October 2010, http://www.mod.uk/DefenceInternet/DefenceNews/DefencePolicyAndBusiness/StrategicDefenceAnd
SecurityReviewPublished.htm. Back
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