The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever) (Con)
My Lords, I add my congratulations to the noble Lord, Lord Touhig, on securing this short debate. I know that this is an emotive issue, about which the noble Lord is particularly well informed, having served as the Minister for Veterans in the previous Government. I agree with my noble friend Lady Garden that the noble Lord is a doughty fighter on behalf of the Armed Forces. It is clear that the whole House recognises the importance that we as a nation rightly continue to place on supporting and valuing the extraordinary service offered by our Armed Forces.
The redundancy programme is a consequence of the size of the Armed Forces being delivered under Future Force 2020 and, as such, there are no implications for the UK’s defence capabilities. However, we do not underestimate the task at hand, and the Chief of the Defence Staff was right to reiterate the scale and complexity of what we are asking of our Armed Forces. I do not need to remind this House that the MoD is engaged in the challenging task of reducing our Armed Forces by some 33,000, or 19%, by 2020 across the whole rank structure and, in tandem, reducing the civilian workforce by some 32,000, or 38%. Every single redundancy is regrettable.
I firmly believe we were right to step up to the plate to commission the long-overdue 2010 strategic defence and security review and to set about reconfiguring our Armed Forces to make them better able to meet the threats of the future. I am confident that our efforts to transform defence through the Future Force 2020 programme will deliver, within budget, the battle-winning forces that we need to reach across the world, operating across the full spectrum of defence activity.
There is no plan B. The redundancies are regrettable, but they are necessary. We have been clear all along that, to maintain balanced force structures for the future, an element of these reductions would need to be made through a redundancy programme. For some, they represent an opportunity. Selection principles through all three tranches of the redundancy programme have, therefore, sought to maximise the number of voluntary applications from all personnel who meet the published criteria. For others, I am fully aware that redundancy has been unwelcome news. In both cases, we have done, and will continue to do, all we can to manage the human element of these changes in the best possible way.
In the first instance, those selected for redundancy are encouraged to apply for a transfer to other areas of the Armed Forces, if they meet the selection criteria and a manning shortfall is forecast in the future. Of course, this is not always possible. All those who are ultimately selected for redundancy receive financial compensation and a comprehensive resettlement package to help them to find a job and transition to life outside the Armed Forces. This is the same resettlement package that they would have received had they completed the whole of their service commitment. In most cases, this will comprise a training grant; travel and subsistence; 35 days of paid resettlement training; career transition workshops; a job-finding service; curriculum vitae writing; interview skills; and access to training courses. Additionally, all redundees will have access to housing and financial management briefings and personal career consultancy for up to two years after leaving. Those who have enrolled for enhanced learning credits will have access to academic courses up to 10 years after leaving.
My noble friend Lady Garden asked me to provide an update on the work of the Career Transition Partnership, or CTP. The CTP is a partnering arrangement between the Ministry of Defence and Right Management Ltd, a leading outplacement company. It delivers the suite of training and employment support that I mentioned a moment ago, which is no small undertaking. In total, the number of Armed Forces personnel who have left service and taken part in the CTP programme over the last 24 months to the end of the first quarter of 2012-13 is some 20,800. Over this 24-month period, some 85% of former participants in the Career Transition Programme found employment within six months of leaving service. This is particularly notable when compared to an employment rate of 70% in the general UK population. I am clear that these measures to ensure a smooth transition to civilian life are working. Evidence provided by service leavers indicates that our resettlement provision is consistently to a high standard and that the services that they provide do assist with a successful transition to civilian life.
My noble friend also raised the matter of housing for those who leave service on redundancy terms. The Government are committed to ensuring that service personnel and their families have access to appropriate accommodation when they leave the Armed Forces. Protections have already been put in place through secondary legislation, which means that members of the Regular Armed Forces, their bereaved spouses and civil partners, and seriously injured reservists, must not be subject to disqualification through a requirement for a local connection. Additionally, following parliamentary approval, local authorities are required to frame their allocation schemes to give additional preference to service leavers who have urgent housing needs. When looking for civilian housing, personnel can take advice from the Joint Service Housing Advice Office, a dedicated team that provides advice on civilian housing options. This service also operates a referral scheme to place personnel in available housing association properties. Service leavers are entitled to remain in MoD accommodation initially for 93 days after the termination of their service, extended by a further 93 days when compassionate grounds require it. Where surplus accommodation is available, recently retired or redundant service personnel can also be offered accommodation for six months on payment of the market rate.
My noble friend Lord Palmer and the noble Lord, Lord Rosser, raised the very important issue of morale. It would be wrong of me to suggest that headcount reductions and pay restraint have not impacted adversely on morale. In quantitative terms, the principal means of monitoring changes in morale within the services is the Armed Forces Continuous Attitude Survey, AFCAS, which noble Lords mentioned. The findings of AFCAS are used extensively in shaping policy for terms and conditions of service. Although the 2013 survey shows that over 70% of military personnel described their morale as either “high” at 39% or “neutral” at 32%, the fact remains that 29% describe it as low. We are aware that we have work to do on that. The key point here is one made recently by the Chief of the Defence Staff: the Armed Forces have demonstrated extraordinary resilience and continued professionalism despite the understandable fall in morale in some quarters. That ability to set aside individual happiness and demonstrate true courage and endurance in times of real austerity is something that each and every person in this nation should be rightly thankful for.
The Government understand that there is concern about the reduction in numbers of regulars before we have recruited and trained the increased number of reserves we require—a point made by the noble Lord, Lord Rosser. However, I urge patience. The Future Reserve 2020 programme has created what we believe is a good offer, and, to paraphrase General Houghton, we have to get the message out that people who join the reserves now are joining something exciting and with a strong future. At the same time as growing and transforming the reserve, we are changing the way that we recruit for both regulars and reserve, which includes partners in commerce. These are two large-scale change programmes which are yet to reach full maturity. I assure the House that, at the highest level, the MoD is now working with the relevant contractors—Capita and ATLAS—and all MoD stakeholders to identify the growing pains, iron them out, mature the programmes and deliver as committed.
I must stress that we are now only four months into a five-year plan to grow the reserves and the recruitment campaigns only began in the autumn. The key target is an Army Reserve at a trained strength of 30,000 by the end of 2018. We must not lose sight of the fact that we already have around 19,000 trained, which means we are already two-thirds of the way there. We do not dispute that it is a challenging target, but the Government agree with the assessment of our senior military leaders: it is a plan that can work.
I understand that there is also concern that Armed Forces redundancies will result in a diminution of our ability to conduct operations. I can assure the House that the redundancy programme has not, and will not, impact adversely on current operations in Afghanistan. Throughout the process, we have been at pains to ensure that we preserve the capabilities that our Armed Forces require to meet the challenges of the future. Our commitments were re-evaluated during the strategic defence and security review and we have ensured that, as we build to our new force structure in 2020, we will retain the flexibility to meet them.
The noble Lords, Lord Touhig and Lord Ramsbotham, the noble Baroness, Lady Dean, and my noble friend Lord Palmer all raised the issue of personnel being made redundant before qualifying for the pension point. I want to assure the noble Lords and the House that we take this issue very seriously in the Ministry of Defence. I quote from the website of the Forces Pension Society:
“The view of the Ministry of Defence is that this is most unfortunate, but that any cut-off dates before IPP or EDPP would invariably leave some Service men and women just outside the bracket. This is unavoidable and adjusting the rules, after their agreement and promulgation would only cause further hardship. Any adjustment of the rules once the redundancies had started would have been very unfair to others who had gone before. After much discussion with the most senior Service authorities the Forces Pension Society reluctantly accepts that that is correct”.
To exempt individuals from redundancy solely to enable them to reach their immediate pension point, subsequently selecting other individuals in their stead, would undermine that principle and is not considered fair. The Ministry of Defence also worked hard to ensure that many more individuals received immediate income for which they would otherwise not have qualified. For other ranks on Armed Forces Pension Scheme 75, the normal requirement to serve for 22 years before receiving immediate income is reduced to 18 years on redundancy. That is a concession of four years. Other ranks made redundant just before the 18-year point are not considered to be pensionable, as they are in fact more than four years away from their original immediate pension point.
Officers on Armed Forces Pension Scheme 75 will still qualify for an immediate income after 16 years. Personnel on Armed Forces Pension Scheme 05 will continue to receive early departure payments after serving for 18 years, provided that they have reached the age of 40. The Armed Forces’ redundancy schemes recognise those who miss out immediate incomes by paying them specifically enhanced tax relief. Under redundancy compensation schemes, where people leave before the qualification point, any pension rights earned will also give them preserved pensions and future further tax-free lump sums, which they will receive at age 60 or 65, depending on the pension scheme they are on.
Finally, the noble Lord mentioned a memo from the Ministry of Defence. If he will let me have sight of it, I undertake to look into the matter.