Armed Forces Readiness and Defence Equipment

Richard Foord Excerpts

Thursday 21st March 2024 Commons Chamber

[Richard Foord (Tiverton and Honiton) (LD)]

I echo the positive words that have been spoken already this afternoon about the reports from the Public Accounts and Defence Committees, and it is timely that we get all this out into the open. In the Budget earlier this month, the Chancellor of the Exchequer said that defence spending “will rise to 2.5% as soon as economic conditions allow.”—[Official Report, 6 March 2024; Vol. 746, c. 846.]

What indications has the Minister had from the Prime Minister and Chancellor about when economic conditions might allow? What are the conditions that might allow, and when might they be met?

This week the Chair of the Public Accounts Committee, the hon. Member for Hackney South and Shoreditch (Dame Meg Hillier), gave an interview to the i newspaper, in which she described “big nasties” facing public spending. She talked about “slow politics”, where decisions are made with a long-term strategic perspective at the forefront. That is especially pertinent when it comes to defence capabilities. As we are entering a period of global uncertainty, it is concerning to read in the PAC report that there are glaring discrepancies around how spending is identified for single services. For example, the report highlights the way that planned spending is reported. Whereas the Royal Navy includes all costs in its plans, creating an on-paper deficit of more than £15 billion, the Army includes only what estimates it can afford, resulting in a running deficit of about £1.2 billion. Had the Army followed the same procedures as the Royal Navy, its deficit would soar to over £13 billion. Such inconsistency in budget reporting is, I am sure, not a deliberate lack of transparency, but it can bring about distrust when it comes to planned defence spending.

The Defence Committee’s “Ready for War?” report stresses the need to replenish our much depleted munitions stockpiles. It highlights that there has been a “hollowing out” over the past 14 years—we have heard that talked about, including from the Dispatch Boxes—but that has been brought into sharp relief by an emboldened, aggressive, nationalist Russian state. If we cannot co-ordinate defence spending in a clear manner, we risk weakening the perception of our defence capabilities. The issue of the budget deficit goes further, with the Committee highlighting a £16.9 billion deficit over 10 years, due in part to rising inflation. We know that defence inflation is greater than other measures of inflation, partly because a lot of our defence equipment is imported from overseas, particularly the United States.

There is a 62% increase in spending on the Defence Nuclear Organisation, and the report states that defence spending would need to increase to around 2.5% of GDP to plug that gap. Ministers are entrenching the uncertainty around budget planning, meaning that important projects risk being deprioritised. At present, the defence budget is thought to be about 2.1%, and some measures try to include our defence commitment to Ukraine, so that it might rise to 2.25%. The MOD said that the difference between 2.25% and 2.5% of GDP is about £6 billion or £7 billion. There are important reasons why that increase might be necessary. Although we spend 2.1% on defence as a whole, around 6% of that goes to fund our nuclear capabilities. Prior to 2010, the UK’s strategic nuclear deterrent was kept out of Ministry of Defence spending measures and held centrally, whereas now it is all included in the defence budget, meaning that our conventional spending has seen a great deal of squeeze over the last decade-plus.

By failing to invest in our armed forces over a sustained period, we have heard cries of operational readiness being affected, and people crying about overstretch. I recall that word from my own service about 20 years ago, when people were declaring that the armed forces were running hot and that they were overstretched. That is why it is essential for Governments to know how much they can commit their armed forces. That comes back to what we used to call the defence planning assumptions about how many operational overseas deployments might take place simultaneously. Up until 2015, those defence planning assumptions were published, but since 2015 they have not been published and have been very much held behind a cloak. I see no real reason from a security perspective or from the point of view of what our adversaries might think, for keeping those withheld. As was pointed out to the Defence Committee, our adversaries probably know our capabilities well, and they will be analysing our intentions. It is arguably better to be transparent about those defence planning assumptions if that means a reduction in the call on the armed forces by other Departments of Government.

In recent years, we have seen that a lot, with Departments having sought to use the armed forces for military aid to the civil authorities, whether for ambulance strikes or to cover for the fire service. The armed forces have been pulled in for those roles and taken away from training, which is essential to their mission. Transparency is very much required.

When that is combined with the persistent issues of repeated cuts and reductions in personnel, our armed forces could be in an even more challenging place than is currently suggested. We really need to sort this out. The right hon. Member for Rayleigh and Wickford (Mr Francois) referred to the recent speech by the Secretary of State for Defence about moving from a post-war period to a pre-war era. I was alarmed to hear that speech. I am an advocate for the Roosevelt phrase,

“speak softly and carry a big stick”.

In talking about moving from post-war to pre-war, I felt that he was doing quite the reverse: investing no new money in defence while speaking with a rather loud mouth.

It strikes me that the Defence Secretary is not doing enough to advocate for spending in private, because he is doing it in public through leaked letters to the Chancellor, as reported in The Daily Telegraph. His predecessor, the right hon. Member for Wyre and Preston North (Mr Wallace), did the honourable and decent thing by stepping away from his Cabinet role when he could no longer tolerate Cabinet collective responsibility in relation to defence spending.

[Mr Kevan Jones]

Does the hon. Member agree that the strategy the Defence Secretary is employing has nothing to do with defence but is possibly to do with a future bid to become leader of the Conservative party?

[Richard Foord]

I grateful to the right hon. Member. While I will not speculate on the Defence Secretary’s intentions, I certainly think that has had the effect of putting him out of step with the Chancellor and the Prime Minister such that he is no longer engaged in collective responsibility.

It seems to me that by talking up increases in the defence budget in cash terms rather than real terms, the Government are hiding behind recent high inflation. I will give the House a specific example. Following the publication of the PAC report on 8 March, the Prime Minister’s spokesperson, who was asked to respond to that report, replied:

“We are ensuring that we have the largest defence budget in history”.

That is so much spin as to be like a vortex—it is way off to suggest that. As we heard from the right hon. Member for New Forest East (Sir Julian Lewis), during the cold war, defence spending was north of 6% of GDP. I am not advocating for defence spending to return to anything like those levels, because I recognise that we were dealing then with an eastern Europe in the grips of Russia and very much surrounded by and part of the Warsaw pact, with all its contributions assisting the Warsaw pact inventory, whereas now our spending is very much contributing to NATO’s defence of Europe and the deterrence of Moscow. I would understand the phrase “as soon as economic conditions allow” if we were talking about an absolute cost—for example, the cost of a frigate or a platform, with a price tag—but we are not; we are talking about a relative cost. The Government need to set out what those economic conditions are.

Finally, I turn to land. As we have heard rehearsed in the House many times, the Army is being reduced from 82,500 to 73,000 soldiers. Earlier, Mr Deputy Speaker talked about the considerable expertise in this place, but the greatest defence experience is probably in the other place. Those who rose to the top of their professions in the armed forces now speak with the greatest wisdom on defence. I would therefore like to quote from some of them, starting with three former Chiefs of the General Staff.

In January, Lord Richard Dannatt said:

“The bottom line is numbers do matter… It is a fact that at 73,000 the British Army has never been smaller”.

In March 2021, Lord David Richards said that “mass still matters”. In May 2022, General Sir Nick Carter said that

“in the order of 80,000”

soldiers are required to ensure that the UK could field a full division as part of a combined NATO force.

Although the current Chief of the General Staff is somewhat restricted in what he can say while in post, in June 2022 he said that the UK was facing a “1937 moment”, and that

“it would be perverse if the CGS was advocating reducing the size of the Army as a land war rages in Europe”.

I firmly advocate for the Army to be restored to that 83,000 figure. When will those economic conditions be met so that we might see 2.5% spent on defence?