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The Ministry of Defence (the Department) determined the future size of the Army based on the need to make financial savings while maintaining enough military capability to deliver required defence outputs. However, it did not adequately consult the Army on its plan to reduce the regular Army by around 20,000 and increase the Army Reserve, or fully assess the feasibility of that plan. The Army needs to increase the trained strength of the Army Reserve to 30,000 by 2019, but its strength has remained at around 19,000 for the last two years. The Army tells us that there will be an increased risk of capability gaps emerging in parts of the Army structure until it reaches the 30,000 reserve target. The Army has some mitigating actions it can take if recruitment performance does not improve, but it has not worked these into a fully developed contingency plan with clearly defined trigger points. The Army's recruitment contract with Capita was not established on the basis of a clear understanding of the scale of the recruitment challenge and at least £70 million of the planned £267 million savings from the contract have already been lost.
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