Breaking the Cycle of Perpetual Crisis at the MoD

It is easy to advance a case for more defence funding and in our echo chambers, we would all agree, with the only dissent being about what to spend the extra money on. Instead, I am going to make a case for a series of difficult choices that avoid the tired old tropes of moving Trident out of the MoD’s budget, raiding the DFiD budget and sacking pen pushers.

If the MoD does get an increase in budget, great, all power to those that campaign for it, but unless that increase is sustained and significant I suspect in a couple of years’ time there will be another funding crisis and we will all be back to arguing about the same things.

The reason for this is because of three things;

1. A fundamental delusion about defence exceptionalism

2. A lack of resilience in the forward programme

3. An inability to make the really hard choices because we cannot prioritise

The cycle has to be broken and the only way we can do it is to address those three.

If there is to be a more honest and realistic appraisal of UK defence needs and futures, the absolute first thing that must happen is honesty with the country and those in the MoD and Armed Services about extents and expectations. There is absolutely nothing wrong with doing less with less but saying we can do the same or more with less is fundamentally dishonest and dangerous.

Defence Exceptionalism – Or Maybe Not

Listen to many defence commentators, evidence sessions to the Defence Select Committee or statements and speeches by Lords and MP’s and one could easily come away with the impression that defence is somehow different to the NHS or Education or Transport budgets. They believe in defence exceptionalism, that the MoD should have first dibs on the public purse and take as much as it thinks it needs but the graph below should dispel that myth.

Yes, we all know this includes pensions, Trident and costs of operations but is it clear the MoD has enjoyed a declining share of national wealth since the end of WWII and more recently, other instruments of soft power and influence have seen an increase.

Even though 2% is an arbitrary NATO target and it is undoubtedly the case that it should be more but here is the thing, it is not going to happen, at least in any significant manner. Yes, we can cast a covetous eye at the DFiD budget but the simple reality is that isn’t going anywhere either. Look at shared funding for certain capabilities, yes, but wholesale changes are not going to happen. Borrow more, the UK’s debt is already too high and debt servicing payments are a significant percentage of current spending, about £50b per year. How about cutting health or welfare budgets, good luck with that.

It is a tradition now that at this point in the proceedings I invite the reader to watch this clip from Bad Santa.

Bad Santa: Wish in one hand…..

.

The evidence would suggest those wishing for greater defence funding are going to be disappointed.

DEFENCE SPENDING IS UNLIKELY TO SIGNIFICANTLY INCREASE ANYTIME SOON

A Lack of Resilience in the Forward Programme

Despite the best efforts of many, the National Security Strategy Review (SDSR 2018) may well come down to a rebalancing of resources away from the MoD towards GCHQ, policing and the security services in response to the returning Jihadi and increasing cyber-attack threats. Combined with growing costs in some equipment programmes, the implications for the MoD don’t look good.

Plus ça change.

There are teams of people in the MoD working on options right now, they are wrestling with huge spreadsheets and unpalatable choices. It is an unenviable task but they will be doing their level best to come up with the least bad options. This may well be a gross oversimplification but one gets the impression that when service chiefs and ministers agree on a force structure and equipment plan it is more than the available budget. There then follows a number of iterations where trade-offs and contingencies agreed but also an element of future efficiency savings included. Those efficiency savings seem to be banked to their fullest extent because when they inevitably fail to materialise and/or something else happens that uses the contingency, the whole force design has to be revisited, at great expense and disruption.

Don’t take this diagram too literally but it would seem this is how it works.

A recent evidence session for the Defence Select Committee was quite illuminating in this regard, with Stephen Lovegrove (MoD Permanent Secretary), Cat Little (MoD Director General Finance) and Lieutenant General Mark Poffley OB (MoD Deputy Chief of Staff for Military Capability).

The MP, Ruth Smeeth asked a question about budget and cash forecasting, Cat Little responded;

A year in advance the rule of thumb is that you should drive to be within 1% accurate. In the past, we have been outside that parameter, and of course, there are some lessons learned about why that is the case. If I was going to put it down to a couple of things, one is that we are overly optimistic in how much money we think we are actually able to commit, contract and spend within a financial period, and the second is that, with the over-programming that Stephen described, we need a much more evidence-based approach to each of our programmes and how we set an over-programming assumption as we enter each financial period.

After decades of defence reform, it seems the MoD is still guilty of over-optimism and suffering from a lack evidence on which to make decisions that feed into this over-optimism. This confirms my suggestion that the programme is pushed right to the line and is not resilient, but the information on which the MoD uses to get to that line is incomplete.

And yet each year we are surprised when there are problems.

Many of the winds the buffet the MoD are not of their making but it is hard to avoid a conclusion that each defence review is based on a force design and equipment programme that has little resilience. It goes right up to the line so that disruption or flawed expectations means the whole thing has to be revisited soon after; followed by a cut here and a cut there, adjustments to specifications and quantities, elongated deliveries and another set of assumptions about yet more future efficiencies.

Whilst it may be unpalatable, there needs to be less reliance on efficiency savings.

By aiming for a smaller committed programme spend it becomes achievable and stable.

 

There are all sorts of reasons why this is not as simplistic as the diagrams above would suggest but there is a fundamental point, unless the MoD gets much better at predictions and invests more money into the people and systems that can reduce the risk of predictions being incorrect, it needs to err on the side of caution. There may be Treasury rules about recycling unspent budget into future years and the avoidance of negative incentive but unless the overall ‘tightness’ in the forward programme, every year there will be the same problems. A procedure that drives negative behaviours needs to be rooted out.

This means an overall smaller forward programme but one that is much more likely to be delivered as planned.

TO ACHIEVE SOME MEASURE OF RESILIENCE, THE MOD MUST RECOGNISE A NEED FOR A COMBINATION OF LARGER CONTINGENCY PROVISION AND LESS RELIANCE ON ACHIEVING PROJECTED EFFICIENCY SAVINGS.

An Inability to Prioritise

Absolutely essential to future success is an ability to prioritise and live with the consequences, no more can the UK get by with defining vague notions of ‘interest’ and pretend we can address them all.

The National Security Strategy and National Security Strategy and Strategic Defence and Security Review 2015 and National Security Strategy and Strategic Defence and Security Review 2015 First Annual Report 2016 describe in some detail the range of threats and risks faced by the UK, they are both very comprehensive documents.

Both define three core security objectives; Protect Our People, Project Our Global Influence and Promote Our Prosperity. The problem with these is they are so vague, one could justify almost any capability or activity with any combination of the three. There is also no means of describing priorities which would influence investment decisions.

This is arguably the toughest of the three challenges because it means giving up some of our sacred cows, accepting that Global Britain might not be that global and instead of pruning here and there, re-shaping the whole tree.

THE UK SHOULD DEFINE PRIORITIES BASED ON RISK AND OPPORTUNITY, THEN ALLOCATE RESOURCES AND MAKES CHANGES ON THAT BASIS. NO LONGER CAN THE UK GET AWAY WITH SPREADING ITS DEFENCE AND SECURITY JAM EVER THINNER

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Andrew Wood, Cllr Canary Wharf ward
Andrew Wood, Cllr Canary Wharf ward

I am a Conservative Party Councillor interested in defence. As a party we are generally interested in defence and certainly when party members are polled they rank defence as a high priority.

But in attending Conservative Party conferences in recent years it has been noticeable how few defence related events there are (even though the few that happen are well attended). I would say the number of defence and foreign policy related events is declining. By contrast events related to housing and Brexit have increased substantially.

I have written a number of articles for the Conservative Home website which have been published but of the three defence related articles I sent, only one was published (about Harpoon), although I have to admit one of the others was rather critical.

I know these are anecdotal examples but indicative I think of party priorities and although it pains me to say this I do not see a material increase in resources for defence in the short to medium term absent another crisis.

As a result we have to look in more detail how we can do more with less and learn from what Jackie Fisher did at the Admiralty where he cut navy spending while also developing Dreadnought.

Senior Moment

Two things stand out:
1 A 2% commitment to the defence spend, is all well and good, but 2% of what?-tanking the economy for political purposes, well ends up with less tanks.
2 A 20% reduction in the value of the pound, will mean that purchases like the F35, the Apache and the P8 are going to cost 20% more.

twexp

The other point about defence exceptionalism to be considered is considering where and why UK gets poor value on its defence spend compared to others such as France and even Germany. 2% is also meaningless when spent so badly….

Barborossa

I was reading a book about the Centurion Tank…

According to that book, the initial order was for 800 vehicles (this was after 17 or so prototypes had been had been placed with various units, subjected to continuous testing and similar). The thing that struck me though, was that this order was planned to be 100 Mk1, 100 Mk2 & the rest all Mk3. To me, the advantages of this seemed so obvious- the manufacturer could get the production line sorted, while working on improvements and the inevitable mods. The Army could train their units on something approximating the real thing, while feeding back.

Compare that to todays programmes which seem to have endless specification and user-requirement changes, before anything is actually built. Add to that the gold-plating that seems to go on, and specific designs for specific users…. And you have a recipe for constant cost and programme over-runs.

IMO, a lot of this has to do with the lack of a trials and research establishment, something the military could feed their operational experience into, a place where they could play with concepts and ideas, and somewhere manufacturers and suppliers could go to for a deeper understanding, and get their ideas tested and played with. It used to be called FVRDE.

Corin Vestey

Personally while I do agree that better prioritisation is essential and this will involve dropping and/or scaling back standing tasks and our aspirations/delusions about our reach and capability, I think it is also worth continuing to fight defense’s corner for a higher percentage of spending. Otherwise we end up simply rationalising each cut as a bravely taken ‘hard choice’ when in fact it is just a sign of political cowardice and shortsightedness. The time will come again when we need – need – well-equipped and capable armed forces and we discover that not only are they simply not there but their absence has in the meantime gravely weakened our allies capability and resolve and emboldened our competitors to the extent that they become enemies. And then we are back to relearning the lessons of the past in the most visceral way possible. Probably unsuccessfully.

That said, having been a supporter of QE class I can now see exactly why that was so foolish of me and wish we had never built them or ordered F35B. To everyone on here who railed against them as a symbol of Britain’s delusions about itself – you were right and I and others who supported their construction were wrong.

Hohum

Defence has a host of serious problems, some of them of its own making but others difficult if not impossible to manage much better than they are now.

1) It wont be popular here but Defence has been an embarrassment for the last 20 years. Both Iraq and Afghanistan were expensive failures that trashed the reputation of the Army in particular and these have been straddled my multiple embarrassing procurement failures (T45 propulsion issues being the latest but there are dark rumblings about a vehicle upgrade programme at the moment too); the result is that its hard for Defence to lobby its position when its reputation is so bad

2) Budget predictability, relying on %GDP rather than GBP figures is dumb as GDP goes up as well as down. Becoming reliant on USD denominated imports of defence material is now also showing its idiocy. This is always going to be difficult but if defence is going to continue being a range of multi-decade bespoke engineering projects governments needs to get to grips with this and guarantee at least 5 yr budgets and budget recycling

3) Individual projects get a lot of bashing around here, Scout being a favourite whipping boy, the problem is the same people who criticise MoD for buying an expensive solution will also be the first to criticise the MoD when they buy a cheaper but less effective solution that is found wanting operationally. Scout is a perfect example, yeah its expensive but its also top-notch

4) And this MoD should improve, there is simply no professional uniformed element in the MoD tasked with or capable of undertaking procurement. It is effectively undertaken by amateurs on short stints- the results are all too often clear to see

5) Strategy; this seems utterly rudderless, with a resurgent Russia the RN is away building colonial sloops and scheming carrier cruises in the Indian ocean and further afield. Army structure is a complete mess and only the RAF seems to be finally showing signs of coherency if only due to the multi-role nature of its platforms.

Observer

@Senior Moment

Doubt you can get much argument on the 2% since it was a general rule of thumb amount set by consensus among the NATO countries. Good thing too in a sense since it cuts off the line of thought that ‘since we no longer have enemies, why have an armed forces then?’. Going buck naked might be good for people…maybe, but for countries, it is nothing but a disaster because if you need an army NOW, you’re about 10 years too late.

@Vesty

How so regarding the QE? From what I can see, it’s ‘meh’ but not that bad.

@Hohum

Iraq and Afghanistan are actually more successful than Malaya in terms of lives lost ironically. The main reason why there is an impression of doom and gloom is frankly because of media coverage. In the past, media was not as prevalent, hence the Malayan Emergency was seen as a successful cleanup. These days, you’re bombarded with criticisms and loss of life reports and ‘sensational failure’ stories that ‘news’ use to sell their brand name, hence the extreme negativity about those 2 ops. This is a personal point of view but if you really want to win a war, make sure you keep the journalists out first, those guys lose you more wars than the enemy.

Hohum

Observer,

Success is not judged in terms of lives lost but in terms of actual victory. The British Army abjectly failed to provide on in both cases.

Corin Vestey

@Obs – nothing wrong with the platform if staffed and supported or the capability it could provide. It’s just that we can’t afford the enablers to protect it and support it, it’s not clear we can staff it or afford really to generate the kind of air wing that makes it worthwhile. As it stands we have procured two ‘large convenient targets’ at the same time as the rest of the RN and RFA is screaming for more manpower and maintenance and support. Not sensible.

Not a boffin

Couple of things to haul aboard. The “over-optimism” bit appears to refer to speed of approval and contracting action – as opposed to overall cost estimate for a project, although of course slippage in the former usually leads to increase in the latter.

Before the “it’s all the fault of the carriers” outrage bus gains any more momentum, consider this. Taking the last years for which the NAO major project breakdowns are available (sadly 2015), you’ll find that the top in-year spend is Typhoon at £976M from a total of £5.1Bn that year (19%). A whopping £200M below that comes QEC @ £742M at 15% of the in year total. Then comes the A400M at £706M (14%) which even exceeds the amount spent on the Astutes at a meagre £682M (13%). Interesting that even at the end of the production run, Typhoon is still by some distance the most expensive project in the EP. Note that 2015 is also well past peak spend of the QEC programme, so that spend ranking ain’t going to change much. Of all the projects in the EP that are past MG, those supporting Air total around £37Bn (£32Bn if you exclude that allocated to F35) compared with £25.7Bn that could be attributed to the Naval service. Alternatively, the in-year EP split is still £2.5Bn vs £2.1Bn in favour of Air and that’s making some generous assumptions as to the “benefit” of complex weapons spend and F35.

Then on to the “manning and support issues”. Are the carriers absorbing significantly more manpower than the ships they’re replacing? By design, no – they’re broadly similar in complement to CVS, of which we were running two up until 2010. They do require substantially more bods than Ocean and one issue appears to be that someone has made an assumption / taken a savings measure on naval manpower when we chose Ocean over Illustrious to run on as LPH, without thinking it through. That is hardly an intrinsic effect of the ships though.

Then you get into which budget all this stuff comes out of. If – as many postulate – “it’s all because of the carriers”, then you’d somehow expect to see the service personnel budget shrink in proportion to the EP. Unfortunately, this doesn’t appear to be the case. Main Estimate budgets for service personnel (civ per is a separate budget) were £8.7Bn in the 13/14ME, £8.8Bn in the 14/15ME and are £9.5Bn in the 17/18ME. Set against a reduced number of people. Go figure. Likewise equipment support. The figures for those three ME years are £6Bn, £6.4Bn and £6.4Bn respectively. You’d expect the latest ME to be higher, but is that attributable to the carriers? Unlikely – not least because they’re not yet in service and therefore don’t – yet – affect that budget.

The fact is that the carriers are barely affecting the budget – certainly compared to other platforms / services that absorb significantly more. What is actually happening is that the defence budget as a whole is not increasing in line with “defence inflation”, which is leading to a resource squeeze across defence. This squeeze is being attributed to “the carriers” primarily because they’re new, they’re much bigger than what has gone before and therefore everyone assumes that they’re consuming much more of the budget. Which doesn’t actually appear to be the case – there would still be significant pain and grief across the board – the big drain on resource is not associated with large grey ships however much people would like it to be.

But what about the numbers of DD/FF? Won’t somebody please think of the 42nd Foot & Mouth? DD/FF numbers (or even Army Strength) are not ends in themselves. It’s basically a binary choice. You either have a home defence force – FJ DCA, AEW, SH, shore ASM batteries, MPA, SSK, MCM, OPV and a rump army. Or you provide useable effect at a strategic level and in doing so, do some of the heavy lifting for your NATO allies. The “in-between” doesn’t add that much for all the extra cost. Lots of NATO countries can supply FJ, DD/FF and infantry – of varying quality, but they’re not exactly scarce, even if their RoE can be constraining.

No-one else – at present – can provide the top-end naval assets in Europe, apart from the US and France (when CdG is available). Which is one reason why they’re very keen for some assistance and why they’ve been very generous in supporting regeneration of carrier strike.

Observer

Hohum, I frankly disagree on the ‘failure’ of the British Army, the main goal of curtailing terrorist training camps in both regions were successful. What was ‘unsuccessful’ is hardly the fault of the British Army or any of the ISAF, the rise of the self radicalizing internet terrorist. Even Iraq was successful in the sense that the rise of ISIS was a bleed over from the SYRIAN civil war, not the Iraqi side. Only after they were disavowed and cut off from Al Qaeda funding in Fed 2014 and the FSA’s hit on Aleppo IN SYRIA did they do their do or die push into Mosul. If anyone is to be blamed, it’s the entire Middle East for being such a hotbed of dissatisfaction that when ‘Arab Spring’ took off, it was pretty much ‘match into gasoline’ time, which gave so much fertile ground for violent extremist groups, recruitment was a snap. Most if the ISIS fighters that cause the current problem cut their teeth in the Syrian Civil War, not the ‘old guard’ which were by reports, ‘80% arrested’. This current batch is their successors.

@Vesty

*Points to Boffin’s post*
Unlike us, you got territory all over the globe, you NEED the carriers while we make do with local runways since our area of operations is massively different in scale. For example, if Argentina decides ‘the Malvinas’ is theirs and do a push again, how else are you going to get aircraft there?

It sucks but that is life, the Pax Britania left you with a lot of commitments (read Overseas Territories) across the globe. The carriers are but one of the things you need to fulfil those commitments.

Hohum

Observer, you obviously don’t actually know what UK objectives were so there is no way you can be right.

Nice to see that NAB is getting his digs in against the RAF early. I’m just waiting for the inevitable light-blue response that trashes Nellie and Dumbo and puts doubts on the numbers of escorts. I mean really, aren’t we beyond this sort of interservice jockeying???

As someone who was trained in the fine art of Project Management long ago, I’m shocked that MoD seems to regard Contingency as something to be added into the planned spending of a budget! No wonder MoD budgets are constantly caught out financially!

There are, as an outsider, so many imponderables with this. Does HM Treas claw back any unused operating or capital budget every year (disincentive to save money, encourages waste)? How competent are MoDs project management practices (good PMs would be knocked back for using best practice as it doesn’t follow the (inefficient) procedure)? Is the practice of stretching the dev and procurement of a project still being done, and who in MoD is coming up with the counter-argument to this practice (costs less in monthly stages, but overall cost is greatly inflated – like taking a loan out over a longer period)?

Lastly, I thought that each of the 3 services were getting their own budget holders for portions of the MoD budget? That should stop a lot of interservice raids on the budget to pay for the newest “thing” in the Capital pot?

MikeW

TD

Really have enjoyed reading the first part of your latest article “Towards SDSR 2018 – Breaking the Crisis Cycle”. Written, I would imagine, after a good deal of deep thinking and analysis on your part, it is extremely thought-provoking and written in your usual eloquent style.

However, and it is a big “however”, I’m afraid that I have to fundamentally disagree with your hypothesis. I get very clearly the reason why you argue that the UK can no more get by with defining vague notions of ‘interest’ and pretend we can address them all. I can also understand your belief that it can no longer get away with spreading its Defence and Security Jam ever thinner and that therefore it is absolutely essential to future to prioritise.

Your theory, though, depends on the belief that it is highly unlikely there will be increased defence spending. It might just be that you are first and foremost a knowledgeable realist and that I am an incurable romantic/fantasist. However, I do not think the later is really true. I have seen reasons for optimism concerning defence spending recently that I have not seen for many years. Among them are the following:

i) the fact that the new Defence Secretary, Gavin Williamson has warned the world is an ever more dangerous place.

ii) the fact that he has already declared in the Commons that he sees 2% of GDP as a base not a ceiling for defence spending.

iii) the fact that warnings have already come from over 30 MPs about their voting intentions should any more cuts be introduced. (The Tory majority is only 7)

iv) Dr Julian Lewis, Chairman of the Defence Select Committee, has said that we should aim for 3% in defence spending.

v) There have been significantly increased calls for calls for Trident’s £31bn renewal cost to be taken out of MoD budget.

vi) the fact that the great British public is finally becoming aware of what is happening in the realm of defence and is becoming increasingly involved. They are supported by a group of toughie M.P.s, including people like Johnny Mercer. Sir Michael Fallon, now that he is a backbencher, has apparently declared that he will also speak against further defence cuts.

There is a massive amount of anger around that the British armed forces have been run down to the extent they have.

Personally, I cannot see that we can prioritise our traditional defence roles to any significant extent or drop any of them. From Domestic Defence of the UK, through Defence of UK interests abroad; the the Securing of our Trade Routes; the reinforcement of Europe; the retention of our Nuclear Deterrent; Counter Terrorism; International Rapid Reaction, etc, etc., I cannot see a single one which I would be willing to relinquish easily.

Anyway, no doubt in later instalments you will be providing chapter and verse to substantiate your always interesting ideas and I look forward with great anticipation to some good reads and, I hope, some opportunity for some cut and thrust argument, particularly over our amphibious shipping.

P.S I do not see moving Trident out of the MoD’s budget or raiding the DFiD budget as “tired old tropes”!

Frenchie

I will seem arrogant, excuse me by advance, but everything that happens does not make sense.
The problem is not a question of money, but what the MoD does with this money.
The problem is not the aircraft carriers, the problem is to be locked with a STOVL version of aircraft carriers, which allows to the MoD to buy only the F-35B.
This is a strategic mistake, a CATOBAR version would have allowed to the MoD to have a wide choice of aircraft, as well as interoperability with the aircraft carriers of the US Navy and France.
The decommissioning of almost new ships, without alternatives.
Concerning the cuts in the military personnel it is a nonsense.
The French armed forces count 200,000 soldiers, and our Chief of Staff thinks it’s not enough.
Regarding the modernization of the vehicle fleet is absolutely unclear.
Reducing the number of Challenger 2.
The insufficient number of modernized Warrior,
The MIV program which is for the moment, if I understand correctly, to complete the insufficient number of Warrior and to plug the capacity holes of the Ajax program, which is an aberration from a French point of view of the mission of a recce vehicle.
In short, the MoD lacks an overall vision to properly equip the British armed forces.

Gareth Jones

Interesting interviews (IMHO) about the ‘Black Hole’ from earlier in the year:

https://youtu.be/00cfGx4vD5Q

https://youtu.be/L4hs8od5BYU

https://youtu.be/gcvTUCz0fwg

Hohum

Frenchie,

Everything you listed comes down to money. It all comes down to money and strategy and currently there is too little of the former and direction for the latter.

Not a boffin

No digs at RAF intended. Merely pointing out where the money has actually gone, vice the perception.

Frenchie

I do not agree with you Hohum, France spends 10 billion euros on the purchase of equipment and 8 billion on maintenance in operational condition, the MoD has an equivalent budget, it is not a question of billion but of coherence, when I see that an Ajax costs 6 million pounds, while a Fennek costs 695,000 pounds, there is a big problem among the hierarchy that decided this.
And I’m not talking about the cost of a Super Hornet compared to an F-35B if the Royal Navy had opted for a CATOBAR aircraft carriers, etc…
It is necessary to have a vision of the very distant future for not to make bad choices upstream, that is why France often withdraws from a European project badly conceived upstream.
For example, at this moment the Chief of Staff is asking the question if we need to order less Rafale in the future for replace a part with FCAS drones.

Hohum

Frenchie, Fennek is rubbish.

Frenchie

The American L-ATV costs 422.800 pounds, it is used as a recce vehicle.

CorinVestey

@NAB I never blamed it all on the carriers, just mentioned them as an example of a role and a platform we cannot afford, which we can’t. There are plenty of other mistakes being made as well as old ones resolutely being built on. I agree with Frenchie.

Simon

NaB is correct in that defence spending is not growing in relation to defence costs [I’ve deliberately tried not to use the word inflation].

Frenchie is correct in that we get abysmal value from our defence spending on comparison to others simply because we have no long-term vision. This includes the industry, engineering and education that sits behind defence spending.

The pound is low.

A triple-whammy!

PS: Gavin Williamson, et al can stamp their feet all they want. They are making noise because they are the new kids on the block. They will be ignored. The current government is unlikely to be in next time round. We will have Brexit-ed. There will be much to de-risk. Chancellor didn’t have the bollocks to raise taxes at about the only point in recent UK history that it is almost essential… and that’s just to pay for the double-whammy increase in elderly and reduction in working populous for health because of UK demographics… which have been ignored for years.

Simon

“FJ DCA, AEW, SH, shore ASM batteries, MPA, SSK, MCM, OPV and a rump army”

SH?

The important discussion is that the acceptance of there is no more money coming 2% May be accepted as a floor and a few people may make arguments for more but they will be doing that in a context of a refusal to increase Tax, a freeze on public sector pay, real terms decreases in-work benefits, social care in crisis based on rapid expansion in elderly population and zero additional funding since 2010 and nothing planned till 2022 at least, NHS funding Blair and Brown got funding to within a whisker of the EU average, it’s declined from 7.7% of GDP to 7% and heading for 6.5% by 2020.

Even if the line is held at 2% of GDP for defence, it is 2% of a GDP which will be smaller than was expected a few years ago, the cumulative impact of a decade of sub 1.5% growth is substantial before you factor in the lower £ for an equipment budget that has aspiration to buy lots of things priced in $.

The decline of national commitment in the original graph includes an important but often ignored change. From 1900 and before to withdrawal from Aden in 1967 Britain and its Empire had commitments, 1969 saw the rolling hills of Ulster and Op Motorman with an interlude at the Islands that shall not be named but again purely UK commitments. From the 1990’s we are the junior partner in a coalition. From the Balkans to the Gulf to Afghanistan, several of the operations have been done on the basis of “something must be done and this is something” or we need to “be seen” to make a bigger commitment than others.

The British public are not going to vote to prioritise defence spend over the NHS so UK can send 10,000 rather than 3,000 or 300 men to a US led operation that they are not convinced is nescessarry and will happen regardless. The real fear is that is not just Afghanistan or Syria. Realistically in a Post Brexit, “send them all home” atmosphere are the British public going to prioritise protecting the Baltics and Poland.

At that point there is going to have to be an acceptance that some commitments can go,
Keep Trident
Keep immediate air and maratime defence of UK.
Keep adequate ground force to support civil contingency at home, Be that terrorism or natural disaster.
How much real money is left and I suspect it would be more usefully spent on bigger Navy than maintains the 2nd Battalion of whatever.

Hohum

You could use a push bike as a recce vehicle. All recce vehicles are not equal. The UK tends to purse the technically most impressive solution available, the result is they get less but what they buy generally (though not always) works better.

Lack of long-term vision for industry though is true; we have seen this time and again and its threatening to trash the combat air industry next.

JohnHartley

In the short term, the Government may buy off a backbench revolt with a bit of extra cash for defence. Probably only for a couple of years & nowhere near the amount needed. Still, every little helps.
In the long term, it is not just defence, but industry, infrastructure & how we pay our way in the World, need to be front & centre for our political elite. Proper 5, 10, 20 year planning with cross party support.
At the moment, Parliament is stuffed full of clueless idiots drifting from one disaster to another.

Observer

Personally, my take on this is that the MoD is used to running a system that worked when there was still enough funding to do both manufacturing AND research, but once funding declines, there has to come a time when you need to cut back on the research as well. Most smaller nations buy from overseas and save on the cost of the research to keep their budget as lean as possible. If you want to do both, you need more money. If you don’t have the money, let someone else do the research. You can’t have your cake and eat it at the same time. There has to come a point when you decide if ‘built by ourselves’ is really worth what you pay for it.

johnno

From way down here in the southern seas. From the little bits that we hear about UK Defence spending the issue seems to be as much about to be about what is in the Defence budget as anything. You seem to have things like the security services pushed into the 2% when it probably should be funded separately. If you exclude ‘the extras’ what is the UK really spending?

Simon

Observer,

I’m not sure that is wholly correct. I get your point but piling money into private firms is NOT the way to do it in the UK. The USA can probably still afford to do this but even they are realising that it is a bottomless pit that can’t be truly controlled. Better to have “secret” bases doing “secret” research.

So I advocate a return to people being plucked out of university and being given the opportunity to serve their country in a way not seen in the UK for years. BAEs, MDBA, etc are not worth the money. They can be used for production/manufacture, but not R&D and prototype builds… I appreciate ships are a bit difficult to prototype :-)

Pacman27

I broadly agree with your hypothesis, but feel it misses a key point, in that Our Politicians have over committed our forces whilst underfunding them for the last 30 years.

1. We cannot articulate properly our strategic defence requirements.
2. We have undervalued our defence forces both in terms of social and economic benefit to the country.
3. Items 1 and 2 lead to the inability to prioritise key components required to deliver item 1 in particular.
4. The unwritten requirement to be a mini US military is untenable at current committed spend and has resulted in too many platforms in too few numbers that itself has skewed the cost profile disproportionately as the UK cannot get critical mass, resulting in poor value for money, reductions in planned orders, product life extensions and ultimately a force with very old kit across many lines of important assets.
5. Service leadership has been poor with the same cycle of waste, poor planning and execution being repeated – this is a lack of governance and one at the core of these failures.

Post Brexit I believe there is an opportunity to kick start the UK economy through an increased set of investment in new British built ships, vehicles and air assets, but this needs to be done in a sustainable way in what Sir John Parker terms drumbeat.

Put simply the UK has a defence fleet requirement for air, sea and land equipment that need to be planned and scheduled over 25 years with an index linked equipment budget allocation of circa £10bn p.a. It then has to be rigorously governed and the industrial base rewarded or penalised based upon its success or failure.

A higher volume of fewer assets is the way we need to go and if this forces us into some prioritisation or compromise then this is probably better than where we are now which is low volumes and old equipment.

Observer

Simon, that itself is the problem. Can you afford the ‘secret bases’ doing the ‘secret research’ which often comes with a ‘secret jaw dropping price tag’. You’re used to playing in the big leagues where you do your own research but the reality is most of the other smaller countries in the world do not have this luxury. What is the more common mode of operating is letting the private firms take the risk and the cost then skim off the successful products. If your budget is going down, your method of spending needs to change too, no more boutique supermarkets, personal designers and own chefs, you need to look at wholesalers now. It’s a shocking change for those not used to it but it needs to be done if you don’t have the cash to throw any more. The UK might be well served to look at how other countries that do not do their own research handle the problem. Military research has always been a leech on funding, often with little to show for it.

Barborossa

If you draw together all the memes running in this thread it boils down to a number of things:
1.) Strategic vision- The political base, and to a ‘slightly’ lesser degree, the MOD do not seem to be able to determine exactly what we want our forces for; There seem to be an multitude of tasks, and threats, some of which are mutually exclusive, some of which require greater resources than are currently allowed for, and some of which require different force structures than are currently allowed for….

And to be honest, in the overall scheme of things, I think some commentators seem to have a degree of tunnel vision. There is a tendency to see the last two world wars, and the Boer War as the norm for Britain, whereas in reality they are the exception. I would argue that putting vast armies and the huge amount of support required onto continental Europe, and other places, was and remains very much the exception. Even the Napoleonic War was a coalition war, with Britain being only the largest single contingent, amongst a number of allies.
As a nation, our largest single imperative has always been to protect our lines of communication (and therefore trade), the homeland and thirdly our interests, by sea initially, but now also by aerospace. This has meant we have always had a larger navy and smaller army, compared to the French, for example. And we have generally conducted expeditionary warfare (being the most efficient way of using those resources). We’ve marched into countries, set up on the rulers front lawn, offered them a deal, set up a local administration & military and buggered off as soon as was decent.

Another consequence of this was that we have always spent on defence technology and industrial support (Yes, you should read ‘The Wooden World’ by NAM Rodger which will make you realise how highly technical the Royal Navy of the 18th Century was and the level of industrial support it engendered, both intrinsically, and externally) more so than manpower.

You could argue that it had a hand in pushing the Industrial Revolution too. Which leads me to my second point:-

2.) The industrial base: Successive governments have continuously erroded the industrial base (You could argue that this process started well before Thatcher, in fact back to Benn, Sandys et al. Those are the two politicians with most blame IMO. Largely because they were both guilty of putting their ideology before facts, expert advice or indeed common sense. But there were and are others, civil servants too.
The consequence of this is we now have a limited capability for mass industrial production. When you beard civil servants with this fact they always run screeching to history and wave the shadow factory system, that did so much in WW2, about…. While, carefully ignoring the fact that you need large industrial concerns, like Austin, Morris and the Rootes group with their large experienced management and work-force to make that happen. We have the research capacity and capability (ironically because universities can now charge tuition fees, and therefore attract investment from industry). The current government are rightly starting to throw money at research, but….

Industrial capacity should always be considered the 5th arm of defence…. After strategic resources. ‘Britains War Machine’ is another good book (not least because it screws over Beaverbrook, who did more damage to the RAF than the Luftwaffe ever did).

Observer

And you want the irony of it all, the Pax Britannia was created by private enterprise. lol.
Global Britain was a shipping company in possession an empire.
Could be worse, Prussia was an army in possession of a state.

Simon

Observer,

It seems that empires are built on trade.

I completely understand your point [re: R&D] and to a certain extent agree with it. The problem I have probably comes back to what Barborossa is eluding to in that my “strategy” is to start at the bottom and build a nation that creates cutting edge engineering.

I could really leave it there as “defence” is just some of the engineering that I think we are (or should be) intrinsically good at.

“Everything not invented by God is invented by an engineer” – The Duke of Edinburgh

Barborossa

You are indeed correct, Simon, although you probably meant to say ‘alluding to….’

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