Defence Spending

John Baron Excerpts

Thursday 19th June 2014 Commons Chamber

[Mr John Baron (Basildon and Billericay) (Con)]

I beg to move,

That this House has considered defence spending.

May I first thank the Backbench Business Committee for allowing this debate? It is much appreciated.

I contend that the UK is making grave errors in cutting defence spending. We need to spend more on our armed forces. In an increasingly uncertain world, we cannot keep cutting if we wish to defend our interests and play a global role. As we approach the next strategic defence review, Parliament must make it clear that defence and security has to be given precedence over other priorities.

It is said that the British seldom read the writing on the wall until our backs are against it. I fear that hard choices will now have to be made if we are not to repeat errors. The need for a strong defence policy is becoming more obvious and urgent almost by the day. The latest increase in China’s defence spending—a 12% real-terms rise—and confrontations in the South China sea and Ukraine remind us that countries not necessarily friendly to the west are increasingly capable and willing to use their military might.

I hope nobody could accuse me of being an interventionist. Having opposed our interventions in Iraq and Libya, the morphing of the mission in Afghanistan into one of nation building and, most recently, the proposed intervention in Syria, I hope my credentials are clear. However, I believe that those entanglements have distracted us, at least in part, from recognising the bigger picture, which is one of increasingly powerful countries elsewhere professionalising and bolstering their armed forces. A willingness to use them illustrates a growing confidence, if not assertiveness. That is significant, because Britain has global interests and needs to remain a global power to protect them. No one can predict—not with any certainty, anyway—where the next substantial threat will come from. As a consequence, our armed forces need to have sufficient capability so that, in concert with our allies, we will be best prepared to meet that challenge.

[Sir Bob Russell (Colchester) (LD)]

The hon. Gentleman will be pleased to know that this Essex MP supports what he has just said 100%. Does he agree that we also need to look at what is happening in the Baltic countries and in particular at Russia’s meddling in the air, at sea and on the land along the border?

[Mr Baron]

I completely agree. I will come to this point shortly, but the bottom line is that a strong defence policy is not just about ensuring peace—although that is terribly important, because it has a dividend—but about sending messages to potential aggressors. That is not just about fronting them, but about supporting allies and like-minded peoples who have a genuine concern and fear about the consequences of the actions of others. It is an extremely important point.

[Mr James Clappison (Hertsmere) (Con)]

I welcome the debate and I agree with every word that my hon. Friend has said so far. Does he agree that although this Government face a difficult financial situation, it is very important that we stay true to our defence commitment to spending at least 2% of our GDP—our NATO commitment and the signal that we must send to our allies?

[Mr Baron]

Yes, I completely agree. If anything, we need to spend more than 2%, but there have been quite authoritative reports, most notably in the Financial Times, suggesting that our defence expenditure as a proportion of GDP will fall below 2%. One of my questions to the Minister—if he cannot answer it in this debate, I am happy to take a written response—is what truth is there in the suggestion that our defence spending will fall well below 2% or, as some figures suggest, 1.8%?

[Bob Stewart (Beckenham) (Con)]

Or 1.7%.

[Mr Baron]

Or 1.7%, as my hon. Friend suggests.

I believe it is particularly incumbent on us to ensure that we have a strong defence policy—more incumbent on us than on other powers, perhaps—because in addition to our global interests and territories, we are highly dependent on maritime trade. The South China sea and the straits of Hormuz may seem far-away places, but I can assure the House that if those sea lanes ever became closed, we would certainly feel the pinch. A shock on the other side of the world, as we all know, can have reverberations here—a rise in the oil price is just one example.

There are many less tangible benefits to a strong defence policy. These include maintaining influence, supporting our defence engineering and industrial base, and global partnerships through defence diplomacy. Despite bruising deployments to Afghanistan and Iraq, Britain still rightly sees itself as a global power, at the forefront of diplomacy. It is impossible to do this without the options that strong defence gives us. Furthermore, there are many strands to the special relationship, but the ability to deploy force by land, sea and air is an essential component. If this is not present, we can expect a markedly different relationship, as former US Defence Secretary Robert Gates recently testified.

I hope we will continue to be close allies of the US. We share common interests and common values. However, we need to play our full part in being a good ally lest our influence and, ultimately, our interests suffer. We should not forget that we would be foolish to depend entirely on the US. Sometimes we may have to act alone. The Falklands is just one example of that. In the absence of US support, we need to ensure that Britain can face the world with confidence, and that will involve strong and credible defence.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Does my hon. Friend agree also that we must do so in the context of NATO, and that it is about time that some of our NATO allies started stepping up to the mark and putting some money into it as well?

[Mr Baron]

Nobody in the House would disagree. It is a sad fact that many of our NATO allies are not pulling their full weight. But that should not stop us accepting what we need to do, particularly given our reliance on maritime trade and our global interests, territories and possessions. If anything, it is more incumbent on us than on many of our NATO allies to wake up and realise that we need to spend more on defence, but I take my hon. Friend’s point on board.

Despite the need for a strong defence policy because of both the tangible and the intangible benefits, we continue to make cuts. The Royal Navy, for example, has been reduced to a mere 19 surface ships. Not so long ago, a strategic defence review suggested the figure should be closer to 30.

[Bob Stewart]

Forty-two. [Interruption.]

[Mr Baron]

I will take further bids. For the moment, though, I will stick with my figure of 30. Have the threats declined since that defence review? No, not since we were recommended to have 30 surface ships. Our aircraft carriers are being built, but there is no certainty that the second one will see service. There is talk about it perhaps being mothballed. The other carrier will have to await fighter jets.

The situation is not much better in the skies. The F-35 fighter is beset with problems. Britain without a maritime patrol aircraft—that is an extraordinary position for an island nation such as ours to be in. We need to try to put that right.

I speak with a vested interest here, I suppose, but it is the Army that has borne the brunt of our short-sightedness. Cost-cutting plans to replace 20,000 regulars with 30,000 reservists will create unacceptable capability gaps in the short term and, I believe, false economies in the long term. Unfortunately, my attempt to get the Government to think again during the passage of the Defence Reform Bill fell on deaf ears, although Members of all parties made their views well known. It was, to a certain extent at least, a close-run thing, given the strong three-line Whip.

These legitimate concerns were echoed—in fact, I suggest, amplified—by an authoritative and critical report from the National Audit Office. It provides a list of critical conclusions, so let me read some of them. It states, for example, that

“significant further risks…could significantly affect value for money”.

Another conclusion was:

“The Department”—

it means the Ministry of Defence—

“did not test whether increasing the trained strength of the Army Reserve to 30,000 was feasible.”

It added:

“The Department’s recruitment targets for reserves are not underpinned by robust planning data”

and:

“Reducing the size of the Army will not alone deliver the financial savings required.”

It goes on:

“The Department did not fully assess the value for money of its decision to reduce the size of the Army.”

These are pretty damning conclusions. Another is:

“There are significant risks to value for money which are currently not well understood by the Department or the Army.”

It then states:

“The Department should reassess its targets for recruiting reserves.”

As I say, this is all pretty damning stuff. I believe that the decision taken in 2012 to cut the Regular Army by a fifth before the replacement reservists were even recruited has not gone well; in fact, it has been a shambles. The NAO has said that it does not believe that the MOD will be able to replace those lost regulars until 2025—a full 10 years away.

[Mrs Madeleine Moon (Bridgend) (Lab)]

Does the hon. Gentleman share my concern that with the MOD cutting the regulars, failing to recruit the reserves and continuing to recruit those under 18, many of those among the numbers quoted are likely to be under-18s and are thus incapable of being deployed?

[Mr Baron]

I share those concerns, and I shall share another one. I was not originally intending to raise it in my speech, but it is a significant concern. To get to the 30,000 reservists—or indeed 36,000 if we want 30,000 to be deployable—we will be heavily reliant on the existing Territorial Army. If we look at the age profile of the existing TA, we find that it includes regular infantry in their 30s, junior officers in their 40s and senior officers in their 50s. There is a demographic issue within the existing TA; it is not just about new numbers, so there are real concerns there.

The clear implication of the recent and critical NAO report is that the transition to 30,000 reservists may turn out to be more expensive than the steady-state costs of maintaining the 20,000 regulars they are replacing. The plan is complete and utter nonsense. We have seen not just a doubling of the ex-regular reserve bonus, the introduction of a civvy bonus of £300 and the equalisation of pensions, but the introduction of other financial incentives, bringing into severe doubt the financial logic and merits of introducing this plan. False economies loom, as acknowledged by the NAO, when it said that the plans could cost even more. We need to sit up, take note and ask questions. If this ends up costing more in the longer term, I really think heads should roll.

[Mr Julian Brazier (Canterbury) (Con)]

I am grateful to my hon. Friend for giving way. I was hugely with everything he said in the early parts of his speech, particularly on the need to keep up spending on our armed forces and defence, but he is really going over the top here. Whatever one’s view of the NAO report, it did not suggest that it could be more expensive to have reservists rather than regulars. What it queried were some of the cost figures, but it could not possibly be interpreted as suggesting that, man for man, the reserves are more expensive than the regulars.

[Mr Baron]

I think that my hon. Friend should look at the report, because it concludes that there is a real risk that what I have described will happen. I understand where my hon. Friend is coming from, and I respect his enthusiasm for the reservist plan, which is clear from his contribution to the debate about it, but I think that he should look at the report extremely carefully.

The MOD went into typical “shoot the messenger” mode. It would not co-operate fully with the National Audit Office, and was not even willing to share its methodology with the NAO. Many questions need to be asked, and I am sure that the Defence Committee, for one, will ask them. I certainly hope so.

This plan has had distorting effects on the ground. As I have said, I have a vested interest: the 2nd Battalion the Royal Regiment of Fusiliers, which is one of my regiments, is one of the best recruited battalions in the British Army, but it is being scrapped to save less well-recruited battalions north of the border. Everyone in the Army accepts that that is a political decision that was made in the light of the Scottish referendum, and it is a complete and utter nonsense. It will cost more to try to maintain battalions that are not well recruited at the expense of those that are.

Britain needs to increase substantially the resources that it commits to its military capability. I know that my right hon. Friend the Minister will point out that we have the fourth largest defence budget in the world, but such cries ring somewhat hollow when estimates suggest that, when it comes to actually deploying force in the field, we rank closer to 20th or 25th. We seem to have a policy of hollowing out our armed forces, keeping expensive bits of kit while taking away manpower, which restricts our ability to deploy force overseas.

I believe—and I accept that there will be a keen debate on this—that a defence budget representing 2% of GDP is simply not enough, let alone a budget that will, in the view of the Financial Times, fall below that percentage. I think that our budget should be increased substantially. Given our dependence on the sea, we should, as a minimum, be funding two properly resourced battle groups centred on our aircraft carriers, and troops that we can deploy if necessary.

The military have done their best within the financial envelope that Parliament has given them. These decisions are for us. They are political decisions about who will get what, when, and how. I have no doubt that we will all have our pet subjects when it comes to the question of what could be scrapped if money were required from elsewhere. I voted against HS2 because it involved £50 billion that could be spent elsewhere over 10 years. I also believe that we still have too many quangos—and can anyone justify the fact that people in public sector management receive salaries far higher than the Prime Minister’s?

Abroad, international aid running to hundreds of millions of pounds for countries that can well afford to help themselves, or are corrupt, or both, should be stopped. If that money cannot be given to other countries that cannot help themselves, it should be channelled back to this country. Meanwhile, extravagant European Union budgets need to be cut. The EU is indeed

“too big, too bossy, too interfering”,

and it needs to be cut down to size. There is no shortage of places where money can be found if the political will is there.

We must reverse the trend, and significantly increase our defence spending. This is not a “call to arms”, but a response to the increasingly uncertain world that we inhabit, and with which we are increasingly ill-equipped to deal. Strong defence is a virtue. It does much to prevent conflict, and it can also be cheaper than the alternative: nothing is as expensive or as wasteful as war. However, if we are to change the mind of Government —any Government—Parliament must become more robust in its questioning of the Executive. It must ask more questions about what is going wrong, and about why we need to put it right.

The debate is overdue, but, as might be expected, it has been shunted to the end of a parliamentary week. It should have been in Government time, and we should perhaps have a debate in Government time on defence spending annually, if not more frequently.

The time has come for action. Opinion on the need to increase defence spending is hardening on both sides, yet we keep cutting. Talking the talk is no longer good enough; we now have to walk the walk.

[Several hon. Members]

rose—

--- Later in debate ---

[Mr Francois]

The Chair of the Defence Committee pre-empts me. On current plans, defence spending will continue to meet the 2% target this year and next year. Decisions on public spending after financial year 2015-16 will be taken in the next comprehensive spending review, but that applies to all Departments and not only to the Ministry of Defence. I hope that that is a clear answer to his question.

At this juncture, it is important to recall that in 2010 we inherited a financial situation in the Ministry of Defence which was, to say the least, distinctly sub-optimal. It was exacerbated by a culture of short-term decision making, prevaricating over big decisions, slipping everything to the right and storing up costs over the long term. As Nye Bevan—that is Bevan, not Kevan—told the Labour party conference in 1949:

“The language of priorities is the religion of socialism”.

If that is so, there was a pretty atheist period when the Labour party last ran the Ministry of Defence. We inherited a financial shambles, which we have had to deal with for four years. The defence programme is affordable over 10 years after some difficult and painful decisions, and as a result of our better financial discipline, the Treasury has allowed us to roll forward recent in-year underspends to supplement our future plans. We are continuing to examine a package of additional investment, including on equipment and cyber. The details of that are currently being finalised, and they will be announced soon.

[Mr Baron]

Will the Minister give way?

[Mr Francois]

If my hon. Friend will forgive me, I must say something about reserves, because I suspect that that is what he wants. I have four points to make on reserves. First, we are aiming for a trained Army reserve of 30,000 by April 2019. Secondly, we have gripped the problems regarding the IT recruitment systems and we have reduced bureaucracy in the process. Hon. Members know that we are investing £1.8 billion over 10 years to make the programme work. Thirdly, our target of a net additional 11,000 trained reservists for the Army is the equivalent of slightly more than 16 additional reservists for each parliamentary constituency, and I have to believe that that can be achieved. Fourthly, and crucially, we have halted 18 years of decline in our reserve forces; for the first time since 1996, the total strength of our reserve force has increased. Our forecast for the trained strength of the Army reserve was 18,800 by the end of quarter 4 last year. We have exceeded that forecast and there are a total of 19,400 in the trained strength of the Army reserve, which is 600 reserve soldiers ahead of the forecast. That is a five-year programme, not a five-month initiative, and as a former Territorial Army officer I remain confident that we can do that.

[Mr Baron]

I was not going to ask about reservists. Only time will prove us right in the end, but we need that time to pass. Briefly, will the Minister return to the 2% question? One hears what he says about the comprehensive spending review in two years’ time, but that should not preclude the Government from committing now to 2% of GDP, whatever that GDP is in two years’ time.

[Mr Francois]

I understand the point that my hon. Friend makes, but I have already attempted to give a clear answer on the position.

I referred earlier to D-day, which resonates with me because my father was at D-day on a minesweeper. He taught me a valuable lesson, which was never to take living in a free country for granted. I think he was in a good position to be able to say that. Yes, we must live within our means, but equally we must not shirk on our nation’s insurance policy. My father taught me that the first duty of Government is the defence of the realm, and I will always remain conscious of that.

Question put and agreed to.

Resolved,

That this House has considered defence spending.