Defence Transformation

Lord Rosser Excerpts

Monday 18th July 2011 Lords Chamber

[Lord Rosser]

My Lords, on this side, we, too, wish to express our sincere condolences at this very difficult time for them to the family and friends of Lance Corporal Paul Watkins who was killed in Afghanistan the other day.

I thank the Minister for repeating the Statement made a few minutes ago in the other place by the Secretary of State for Defence. It covers a number of big policy areas: the RAF basing review, Reserve Forces, the financial settlement and cuts to the Regular Army. The Statement, as did the strategic defence and security review, repeats the Government's line about the financial position they inherited, which arose as a result of a global economic recession which was not sparked off in this country. The Statement refers to a £38 billion black hole, but that figure assumes a flat line in cash terms in the defence budget over the coming years; in other words, a decline in real terms, which is unlikely. It also assumes that every commitment, including equipment, will be adhered to.

The National Audit Office 2009 report into major projects at the Ministry of Defence stated:

“If the Defence budget remained constant in real terms, and using the Department's forecast for defence inflation of 2.7 per cent the gap would now be £6 billion over the next ten years. If … there was no increase in the defence budget in cash terms over the same ten year period, the gap would rise to £36 billion".

I appreciate that this Government have managed to reduce the rate of growth during their period in office, but presumably even this Government intend to ensure that growth in the economy, from which additional resource can be provided, returns at some stage in the not-too-distant future.

The recent strategic defence and security review, which seems, with every MoD Statement, to be becoming less related to reality and expected reality, stated:

“Further work is required to determine the numbers of personnel that will be required to man the 2020 Force Structure. The Defence Reform Review, the review of Reserve Forces, further efficiency measures and changes in the policy context will all need to be taken into account at the next Strategic Defence and Security Review, which will set out detailed plans for the five years beyond 2015 ... We will also, for now, assume that by 2020 we will require a Royal Navy of 29,000 personnel, an Army of 94,000 and an RAF of 31,500”.

Yet the Government have announced cuts to the Army of 17,000—a sixth of the entire force—in just 10 months. However, in opposition, the Government said:

“In the real world the only logical conclusion you can come to is that the army is already too small”.

The SDSR referred to members of the Reserve Forces performing outstandingly well in Afghanistan, and we share that view and pay tribute to the commitment and dedication of our Reserve Forces and to the real contribution they play in protecting our own citizens and the lives of others in operations abroad. The SDSR also referred to the six-month study being undertaken into the future role and structure of the Reserve Forces and the Statement today includes the Government's response to that review. We, too, would wish to place on record our thanks to General Sir Nicholas Houghton, the Vice-Chief of the Defence Staff, and his two colleagues who undertook the review. Will the Minister say whether the review suggested that the reductions in the Regular Forces should be made in the light of their recommendations on the Reserve Forces?

The Government have said that they will be undertaking a strategic defence and security review every five years. They now appear already to be making policy decisions on the structure and composition of our Armed Forces for the five years between 2015 and 2020, the period to be covered by the next defence review. What then are the strategic decisions and goals that have been made and determined for the five years from 2015 to 2020 which the decisions announced in the Statement today are presumably intended to deliver? Is it the Government's approach that our strategy for the five years from 2015 to 2020 will be determined by the Armed Forces that we have decided we will have rather than our required defence strategy for those years being determined first and then consideration being given to how to provide the Armed Forces needed to support and deliver that strategy?

If the Reserve Forces are to constitute some 30 per cent of our forces, rather than less than 20 per cent, to what extent will they become stand-alone units? There will be concerns if bespoke standing units of reservists were to become the norm since this could increase the commitment required from civilians and therefore potentially hinder recruitment. Will this approach not also undermine the one army concept? It appears as though the review highlighted the cost of Reserve Forces compared with the cost of Regular Forces. In view of the proposed increase in the percentage of our Armed Forces who will be reserves and the significant reduction in regulars, how do the Government evaluate the abilities, experience and expertise of our Reserve Forces against those of the Regular Army personnel? Do the Government consider them less effective, more effective or of equal worth and value person for person? How is such an assessment made and by whom? The boost to our Reserve Forces is, it would seem, intended to make up for the fact that our Regular Forces are being reduced.

The Statement, referring to the Army, indicated that two major units and a formation headquarters will be based at Leuchars. Does this mean that RAF Leuchars will close? Will the Minister for clarity say how many personnel and what personnel are currently based at Leuchars and how many personnel and what personnel will be based at Leuchars once these changes have been implemented? What will be the cost of that change, who will be paying for it, and how long will the time lag be between the moving out of present personnel from Leuchars and the moving in of the new personnel? What is the Government’s assessment of this change on the local economy?

The Statement referred to the savings that would be realised by the reduction in regular personnel. It stated that money would therefore become available for reinvestment in our Reserve Forces and also for the construction of additional Chinook helicopters, which was an undertaking the Prime Minister gave. We welcome any additional investment in our Armed Forces, and not least the £1.5 billion investment package over the next 10 years to enhance the capability of the reserves, and the increase in the defence equipment and equipment support budget by 1 per cent a year in real terms—though we note that that is not until 2015-16. Can the Minister confirm, though, that this means there will be no increase in real terms in the rest of the core defence budget from 2015-16 to 2020-21?

We are seeing additional resources having to be devoted to our operations over Libya, which is being paid for from the general reserve, and also the need to finance the additional Chinooks promised by the Prime Minister. To conclude, what meaningful assurances can the Minister give that today’s further announcements, which we will certainly wish to study in far more detail than we have been able to so far, have not been influenced by financial considerations, but purely by military considerations?

[Lord Astor of Hever]

My Lords, I am very grateful to the noble Lord. He asked me lots of questions which I was writing down as fast as I could. I will do my best to answer as many as I can, and if I do not answer them all, I undertake to write to him.

The noble Lord first asked about the SDSR. In announcing the SDSR, the Prime Minister was clear that in his view the Future Force 2020 structure would require real year-on-year growth in the defence budget beyond 2015. The announcement today that the MoD can plan on an increase in equipment and an equipment support programme in the years before the spending review settlement means that the department has a firm base for its longer term plans. This will enable the department to make better value-for-money decisions, and makes clear this Government’s commitment to deliver the forces necessary to meet our future commitments.

The noble Lord then asked if there are going to be reductions in the regular Armed Forces because of cuts in reserves. We are confident that with the additional investment, the reprioritisation and efficiency improvement and the planned withdrawal from combat operations in Afghanistan we can rebalance the Army in particular, so that we can have a whole force of around 120,000 with a ratio of about 70 per cent regulars to 30 per cent Territorial Army. This will allow us to maintain an enduring commitment at brigade level as described in the SDSR. As the Secretary of State has said, the role of the Territorial Army has been greatly undervalued too often in the past. It will continue to have an important role in the Army.

The noble Lord then asked about strategic decisions and the Future Force 2020. We are confident that with the additional investment, the reprioritisation and efficiency improvements and the planned withdrawal from combat operations in Afghanistan, together with a rebalancing of Regular and Reserve Forces, we can generate the forces required to achieve the objectives in the SDSR, including the ability to maintain an enduring commitment at brigade level as described in the SDSR.

The noble Lord asked about the expertise of reservists. I have some personal experience: I was for a number of years colonel of a Sapper TA regiment. They had expertise of a very high order, they were very highly trained, and whenever they went out to Afghanistan they were very much respected by the Regular Forces with which they trained. This is an issue that we will be working on. Clearly, recruiting, which the noble Lord mentioned, is vital. A recruiting and training surge will be needed to meet the demands of the revised reservist roles, and to provide for more viable unit strength. The establishment of an effective recruiting and training mechanism to handle the potential surge requirement will be an essential precondition of success if reserve manpower decline is to be arrested, initially, and then increased. This should include rapid changes to existing processes and regulations to make it more attractive for ex-regulars to join the reserves on leaving.

The noble Lord then asked whether RAF Leuchars is closing. Leuchars is not being closed. It will become a major Army base. Following the SDSR, the Royal Air Force needed three, not four, RAF fast-jet bases. It could not make military sense, and would be uneconomic, to close RAF Marham or RAF Coningsby. A decision had to be taken that was best for defence as a whole. With the Tornado force drawing down at Lossiemouth, we concluded that we could build up the Typhoon force there rather than continuing at RAF Leuchars, enabling Leuchars to be utilised for the MRB to be based in Scotland.

The noble Lord mentioned the Chinooks, and I can confirm that we will be ordering the 12 plus the two very early on in the autumn. He welcomed the 1 per cent increase and asked if would it affect the rest of the defence budget. Her Majesty’s Treasury has agreed that we may plan on the basis of an uplift of equipment expenditure, and equipment support year-on-year of 1 per cent above inflation in the years beyond the current spending period. Finally, all these decisions were taken solely on military considerations.