EUROPEAN DEFENCE AGENCYSTEERING
BOARD MEETING, MARCH 2006
Letter from Rt Hon John Reid MP, Secretary
of State for Defence, Ministry of Defence to the Chairman
The next European Defence Agency (EDA) Steering
Board meeting is due to take place on 7 March. I am committed
to improving the transparency of EDA-related business, and in
particular the Ministerial level meetings of its Steering Board.
I would therefore like to take this opportunity to inform you
of the main items I expect to be discussed at this meeting. I
also enclose for your information the draft agenda and draft papers
that have been circulated by the EDA (not printed). The final
papers for this meeting will not be issued by the Agency until
some time after 24 February, thus I am not able to provide these
to you at present.
The first item on the Agenda will be an administrative
point on the auditing arrangements for the EDA's accounts. Similar
to the situation that arose last year, the Agency is once again
asking to derogate from its Financial Regulations. Instead of
establishing a college of auditors consisting of six auditors
from participating member's states, the EDA is requesting that
two auditors are reappointed from the 2005 college and one additional
auditor is appointed from a third participating member states.
We have received this proposal late in the day and my official's
are currently considering it. I am therefore unable at this stage
to tell you whether we will be able to accept this.
The main substantive discussion at the Steering
Board will be European Defence Research and Technology, on the
basis of the discussion paper at annex (though this paper may
be amended following discussion by officials on 24 February).
The paper first puts forward an idea for a particular
model (the "ACARE" model), which could be used to derive
R&T programmes from capability needs. Although the EDA have
suggested a programme of research, in the area of Force Protection,
I will wish to see other options considered as well. I will look
forward to receiving proposals for a programme of research, but
without prejudice at this stage on whether we will decide to become
involved in any research in this area with EDA partners. I will
also want to ensure that we properly understand how EDA proposes
to adopt the ACARE model to ensure that it is suitable for the
The other main issue will be an EDA suggestion
for a novel way of funding R&T. This has potential attractions
but the details of this approach need to be developed. I intend
to agree that this idea should be developed for further consideration
by the Steering Board in May.
I will support an EDA suggestion of an examination
of the technologies that will be important in the future but will
insist that this is firmly based on the EU's emerging Long Term
Vision of its capability needs. I intend to ask for a better explanation
of the role and possible composition of the European Defence Science
and Technology Advisory Board that they have proposed.
21 February 2006
Letter from the Chairman to Rt Hon John
Thank you for your letter dated 21 February
which Sub-Committee C considered at its meeting on 2 March.
The members of the Sub-Committee would like
to express their gratitude for the improved level of communication
on matters concerning the European Defence Agency (EDA) which
your letter represents. It is extremely helpful to be alerted
to issues which are due to be considered by the Steering Board
prior to its meetings.
With reference to the proposed derogation by
the EDA from the Financial Regulations, we believe that this is
a sensible way of proceeding prior to the review of those Regulations
which is due to take place at the end of 2006. We agree that a
simplified procedure for the appointment of the College of Auditors
would be appropriate for the EDA subject to satisfactory proposals
being brought forward.
With respect to European Defence Research and
Technology, we fully support the idea of increased collaboration
between participating Member States. It is important that such
collaboration receives the funding necessary to ensure that it
is effective and worthwhile. However, collaboration should be
built up gradually as particular projects are identified.
We therefore agree with the idea that there
should be a pilot project for R&T on the ACARE model which
would demonstrate the value of collaboration. It is likely that
early collaborative projects would be relatively small-scale in
order to encourage participation. However, once suitable projects
have been identified, participating Member States should be prepared
to give those projects their full support.
We do not believe that the EDA should be provided
with a significant R&T budget to spend as it wishes, but collaborative
projects need to be properly funded and the EDA should have control
over the spending of those funds where that would ensure the most
efficient means of delivery. There is, accordingly, some value
in the EDA's proposed "middle-way" for funding of R&T
and the EDA should be encouraged to prepare more concrete proposals
on this basis.
More generally, we also consider that business
spending on R&T should be taken into consideration when making
decisions on funding. The significant sums spent by the defence
industry cannot be overlooked when dealing with R&T.
We look forward to hearing the outcome of the
7 March Steering Board and hope that our comments will be taken
6 March 2006
Letter from Rt Hon John Reid MP to the
You will be aware that the Ministerial Steering
Board for the European Defence Agency (EDA) met in Innsbruck on
7 March 2006. I wrote to you on 21 February with the agenda, draft
papers and an outline of the likely points of discussion. I was
grateful for the comments that were received from the House of
Lords select Committee on the European Union.
I would now like to inform you of the outcome
of this meeting and to provide copies of the papers that were
considered at this meeting (not printed). These differ slightly
from the papers I sent to you before the meeting as they were
updated and reissued prior to the Steering Board.
The administrative decision on the derogation
from the EDA's financial regulations, which I informed you of
in my previous letter, was not tabled at this meeting. Following
official-level consultation with the National Audit Office, I
was happy to agree to the EDA's proposals for a reduced College
of Auditors this year. However, due to the short timescales involved,
other member states were not in a similar position. The proposal
was not therefore placed on the Agenda for agreement at the Steering
Board but will instead be dealt with under a written procedure.
One item, which came as a late addition to the
Steering Board Agenda, was for agreement to authorise the Head
of the Agency to make the Administrative Arrangement between the
EDA and the Norwegian MoD effective through the exchange of letters.
The Norwegian Administrative Arrangement was agreed at Council
on 27 February in accordance with Article 26 of the Joint Action
establishing the Agency. I was therefore content for the exchange
of letters to take place. This will enable Norway to collaborate
with Member States through the Agency to improve European capabilities
and will enable the transfer of Norway's ad hoc R&T projects
from the Western European Armaments Organisation to the EDA.
However I also expressed my regrets that a similar
outcome has not so far been achieved for Turkey, as there is currently
no consensus in Council to agree their Administrative Arrangement.
Turkey plays an important part in ESOP, in Bosnia and in Battlegroups,
and I believe it can make a major contribution to European capability
development. I therefore urged member states to progress this
issue as quickly as possible in the hope it can be resolved by
the time of the next Defence Ministers' GAERC in May.
The main substantive discussion at the Steering
Board was European Defence Research and Technology, on the basis
of a paper produced by the EDA. I have attached the paper that
was considered at the meeting. This is a slightly amended version
from the paper that I attached to my letter of 21 February.
With respect to the EDA's "middle way"
funding mechanism, I made clear that the UK did not need a new
funding mechanism to encourage us to spend on R&T. We already
spend more than other partners on defence R&T and would continue
to look for opportunities to collaborate with others in the EDA.
I said if the new funding mechanism allowed countries that invested
less in R&T to do more, then the UK was prepared to consider
it. The EDA will now work up detailed proposals for the new funding
mechanism. This will be presented at the May Steering Board, at
which time Ministers will be able to decide whether or not they
wish to use this mechanism to fund R&T projects.
I supported the proposal for the EDA to conduct
a pilot exercise to derive from capability needs an R&T programme
suitable for joint investment. I did, however, caution that the
UK is already well advanced nationally in the suggested capability
field of force protection, which may make it difficult for the
UK to participate on joint projects within this area. As an alternative,
I suggested that logistics may be a better area to focus on in
order to work up suitable concrete proposals to allow joint investment.
The EDA will now proceed with the pilot exercise to ensure that
their proposals are well advanced by the May Steering Board and
completed by the and of June.
Finally, l agreed that the Agency should develop,
by the May Steering Board, a roadmap for achieving an agreed European
R&T strategy and priorities. I also gave my consent for the
EDA to commission a study of the impact of Defence R&T on
the wider economy. However, I felt that the EDA proposals for
an Advisory Board were somewhat underdeveloped. This proposal
will therefore be parked for the time being, while the EDA tackles
other priority areas that I have detailed above.
15 March 2006