Alphen, Netherlands. 9 July. Britain is to spend more on defence. However, upon what Britain spends more on. for what reason and to what effect must now be at the core of the coming Strategic Defence and Security Review 2015 (SDSR 2015) due to be unveiled in October.
Chief of the British Defence Staff General Sir Nick Houghton called yesterday “a great day for defence”. He also said that the defence chiefs would no longer need to focus on “managed decline”. And, on the face of it I must swallow some humble pie this morning. Or, rather, I can feel vaguely vindicated that my long campaign with many others has succeeded (including the writing of a 2015 book – Little Britain: Twenty-First Century Strategy for a Middling European Power) to get the British Government to restore some strategic balance and respond to the real world as it is not as they would like it to be.
In yesterday’s budget statement Chancellor of the Exchequer George Osborne committed to maintaining Britain’s defence budget at the NATO guideline of 2% GDP until 2020 and to the creation of a Joint Security Fund of £1.5bn per annum. Now, one has to be careful about just what will be included in this beefed-up ‘defence’ budget. However, if real then not only has a thin red line been drawn under the massive defence cuts of the last five years but an investment base is being established that will confirm Britain as Europe’s strongest military power, and a modest but influential world power. Critically, SDSR 2015 now has sufficient investment behind its thinking and planning to establish a new, radical, joint British force able to reach out to allies and across to civilian partners both within government and beyond.
Let me give you an idea of scale. Whilst the British defence budget pales into significance alongside this year's US defence budget of some $534.3bn (£353bn or €492bn) London still spends a lot of money on defence and is about to spend more. Indeed, with an economy worth some $3015 trillion (£1958 trillion or €2717 trillion) in 2015 spending 2% GDP amounts to some $60.3bn (£39.16bn or €54.3bn). Poland, for example, will spend this year spend some 38.4bn Zloty or $10bn on defence.
However, there is still some devil in the detail of the Chancellor’s announcement. This year Britain will spend (rather than budget for) some $61.8bn on defence (£40.13bn or €55.69bn). In other words, going from 2.15% of GDP on defence to 2% still represents a further real terms cut of $1.5bn or £0.98bn. There is clearly some budgetary sleight of hand at work in these figures. However, the simple truth is that if the 2% target is to be met over the 2016-2020 period Britain will indeed need to spend an additional $6-8bn of defence.
The critical point is this; with a committed defence equipment budget of £163bn ($250.75bn or €226.46bn) over the 2011-2021 period and with the commitment to a real terms increase of 0.5% per annum until 2020 in the defence budget the new British Government has clearly moved to stabilise a force that was beginning to show signs of serious decline and service chiefs can far better balance new equipment and the demands on personnel they will make. Indeed, whilst these investments do not match the current levels of investment being pumped into their respective armed forces by, say. China and Russia (frankly nor should they) if one removes France from the equation the UK defence equipment budget is bigger than the rest of Europe combined. Given the centrality of alliances and coalitions to British defence strategy that growing disparity will itself mean growing interoperability problems with under-equipped European allies in the years to come. So, yesterday’s announcement demonstrates a British Prime Minister who has made a very public decision to remain close to the United States at whatever cost. Are you listening Washington?
So, what else does yesterday’s announcement reveal about the state and future of the British armed forces?
1. SDSR 2010 made defence cuts that went too fast and too far as the government panicked in the aftermath of the banking crisis and tried to re-balance the national books unrealistically quickly. Indeed, yesterday’s entire budget statement was an implicit admission of that;
2. SDSR 2015 now has enough guaranteed investment for planners to think strategically rather than strictly financially and thus will be far better able to match defence ends, ways and means in the coming years. To that end, the National Security Strategy and SDSR 2015 must clearly be part of a strategic planning continuum centred upon the National Security Council which must act in turn as the security and defence planning driver across government; and
3. The Joint Security Fund reinforces an idea central to my book Little Britain that the British establish a ‘joint’ vision across the two axes of national security and defence and the tri-service. Recent initiatives such as the Joint Force Command (JFC), Joint Expeditionary Force (JEF) and the Combined Joint Expeditionary Force (CJEF) with the French, must be built upon to generate sufficient mass to deter, sufficient 'manoeuvre' to move quickly, and sufficient agility to work with all possible partners across the conflict spectrum. In short, defence must be properly plugged into security.
There are also some real challenges that must be addressed by the Armed Forces themselves:
1. Why do the French (for example) with a comparative but marginally smaller defence and defence-equipment budget always seem to get more force for each euro of investment? For too long Britain has been ‘rubbish’ at defence procurement and for too long prime defence contractors have run rings around the British defence Establishment. This has helped to significantly boost defence cost inflation and resulted too often in inferior kit being procured at inflated prices very slowly and in insufficient numbers. Yesterday the share value of BAE Systems jumped significantly on the announcement of a defence budget hike. If that means investors think BAE (and Thales) can again gorge their extended guts on the defence teet then they must be sorely disappointed;
2. SDSR 2015 must be the enablers review, i.e. the focus must be on those things that bind the forces into one force by providing eyes, ears and brains. One of the tragedies of SDSR 2010 was that it forced the three service chiefs to defend their respective core forces. The Army tried (and failed) to defend its regiments, the Royal Air Force defended fast jets (well most of them), and the Royal Navy focused on getting the new carriers completed, together with the other new platforms desperately needed after over a decade of land-centric operations. Vital enablers such as vital maritime patrol aircraft were cut because there was no service chief to defend them during a Treasury rather than strategy-led assault on the Armed Forces.
In Little Britain I call for a new understanding by London of its role and that of its armed forces in the new nexus of twenty-first century nastiness. A role that must confront dangerous change in the world and reflect the power and responsibilities of one of the world’s top five economic and military powers, that places the forces at the heart of Britain’s security and defence, and strikes a new balance between the size, scope, missions and tasks of Britain’s world renowned armed forces. Yesterday, Prime Minister Cameron together with his colleagues George Osborne and Defence Secretary Michael Fallon stepped up to the plate and for that I offer my sincere congratulations. Britain is beginning to restore strategic balance and that will in turn strengthen the tattered transatlantic relationship, NATO and European defence. I could niggle about this or that but I will not because yesterday, I saw something I have been begging for – British strategic leadership. Thank you, Prime Minister, for your “big push”!
However, I will finish with two challenges. My first challenge is to the service chiefs. I have the honour of knowing General Houghton and First Sea Lord Admiral Sir George Zambellas, and I respect Chief of the Air Staff Sir Andrew Pulford, and Chief of the General Staff Sir Nick Carter. These are serious people doing a very serious job at a very serious time. However, let me be blunt gentlemen. The Chancellor has afforded you a chance to present your joint vision of the future British force and to deliver it. You must therefore speak with one voice to the Prime Minister, the Chancellor, Secretary Fallon and the ‘Chief’. That means no more implicit warfare between the Navy, the Army and the Air Force over budgets. As a taxpayer I find such inter-Service rivalry/tribalism not only ridiculous but boring and dangerous. Sadly, I am still hearing echoes of tribalism in the corridors of power and in the various service strategies being worked up. It must stop. For the country’s sake don’t blow it!
My second challenge is to the Secretary of State for Defence, Michael Fallon. The Whitehall culture is first to protect the minister and only then to protect the country. As SDSR 2015 is being worked up over the next (and famous) “100 days” it will succeed only if it is a truly strategic document that balances strategy, capability, capacity and affordability. If that balance is to be struck assumptions will need to be challenged. That in turn means the planting of a real Red Team at the core of the process, a real awkward squad, people who will and can challenge both process and assumptions and who are far more than legitimisers of perceived ministerial and department wisdom. That in turn will require political courage, Mr Fallon, which I believe you possess in spades.