Defence Expenditure Debate

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Department: Ministry of Defence

Defence Expenditure

Madeleine Moon Excerpts
Thursday 27th October 2016

(8 years, 1 month ago)

Westminster Hall
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Madeleine Moon Portrait Mrs Madeleine Moon (Bridgend) (Lab)
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I will not delay everyone for long. Although the Committee found that the Government’s accounting criteria fell firmly within the NATO guidelines, we also found that those criteria had been amended to include several significant items that had not previously been included when the UK calculated its defence expenditure. That is the nub of the issue that we must address. The Committee is concerned that the inclusion of such items, which were critical in attaining the 2%, could undermine the promises in the SDSR of new money for defence.

During our inquiry, there was considerable discussion of the 2% as an indicator of Britain’s political willingness. Witnesses said that

“2% is good politically”

and not to meet the 2%

“would have been damaging to our reputation politically.”

The 2% was said to have

“a…powerful symbolic meaning”.

The UK has made great play of that 2% as demonstrating its commitment to collective defence in NATO, but the inclusion of items that had not previously been included, such as pensions, has not gone unnoticed—with considerable contempt—across the alliance. As well as being a member of the Defence Committee, I represent the UK on the NATO Parliamentary Assembly, and I have found that other countries, when talking about their expenditure and accepting that it does not reach 2%, take great delight in pointing out that their figures do not include pensions, as they have no wish to use creative accounting to bolster their spending. That is divisive within NATO and damages our credibility and capability to defend our shores and those of our allies.

Our report highlighted that 2% should be a minimum, not a target, and certainly should not be seen as an indicator of capability or capacity, or give a false glow of competency and readiness. The report also urged the Government to provide a calculation of what defence expenditure would be if we left out the new items such as pensions and used the same items as we had under the 2010 accounting rules. We still await those figures.

A perfect storm is building of cuts to personnel, cuts to training, problems in procurement and gaps in capability. With the 2%, there is a disparity between our procurement aspirations and their affordability—and our capacity to deal with major defence equipment deficiencies, such as the engines for the Type 45 destroyers and the delays in replacing the Type 23 frigates and logistics supply ships. I have a major concern in particular about the Royal Navy’s capacity and capability. If we went back to realistic accounting, perhaps we would be able to deal with those issues.

I do not want to take too much time, because I know that colleagues want to speak, but I must emphasise that in our report, the Committee expressed concern that the UK must not become a hollow force. Sadly, despite the great commitment and bravery of our personnel and their amazing “make do and mend” ingenuity, I fear that we are hiding our vulnerability behind the cardboard shield of 2%.