UK Defence Forces

Lord Dannatt Excerpts

Thursday 23rd November 2017 Lords Chamber

[Lord Dannatt (CB)]

My Lords, I add my thanks to the noble Lord, Lord Soley, for securing this debate. His choice of wording is most appropriate. He speaks of a “sufficient level”—nothing excessive or gilded—

“to contribute to global peace, stability and security”,

which is the first duty, as we surely all agree, of any responsible Government. Yet there are well-founded fears that our defence capability is to be cut once again. Yes, we all know that the current Front-Bench response is to reassure us that these are only options that are being looked at, at present, and no decisions have been taken. But the real world is that options can quickly become decisions, and then the damage is done. In 1996, axing the royal yacht was an option, but that option became a decision, saving a paltry £60 million and causing lasting damage to the standing of the United Kingdom and great hurt to Her Majesty.

Today, it is also said that the defence budget, pegged to 2% of GDP, is rising year on year in cash terms, to which is added a 0.5% rise in the equipment budget. That fools no one who has any understanding of the realities of funding defence. Defence inflation has historically stood at a higher level than general inflation. Moreover, with an increased dependence on buying US equipment, we are subject to adverse exchange rate movements and, in terms of equipment procured from domestic industry, our product runs are small so there are no economies of scale, and our requirements are at the cutting edge of technology because we want the best for our people. Therefore, risk is high, delay is commonplace and cost over-runs are an inevitable consequence. It should not be like this, but that is the reality of defence procurement, which has stood resistant to change despite the reforming efforts of successive Governments.

So what is to be done? There are three choices: either cuts to our capabilities have to be made to save money, or there have to be further efficiencies, which are more cuts by another name, or there has to be an increase in our defence budget—an unlikely prospect, given the silence of the Chancellor on this subject yesterday. Therefore, in a national zero-sum game, this inevitably takes us back to the debate about the balance between defence spending at 2% of GDP and our spending on overseas aid at 0.7% of GDP. A 0.25% adjustment between those two figures in favour of defence would see a reallocation of some £4 billion to £5 billion from the overseas aid budget to the defence budget, a figure that would largely solve the crisis in defence spending over a 10-year period.

While we are obsessing over internal budgetary matters and over our approach to Brexit, I fear that there is a danger that we forget to lift our eyes to the horizon and reflect on how others see the United Kingdom, both our allies and our potential foes. It is only a few weeks ago that US General Ben Hodges commented with evident sadness that the UK was in danger of losing its leadership role among European nations as our defence capabilities diminish. He was expressing a strongly held view in the US that the UK is sliding towards military irrelevance. In Oral Questions the day after General Hodges made his comments, I asked the noble Earl, Lord Courtown, whether it was still the Ministry of Defence’s policy that our land forces should be able to deploy a division of at least two UK combat brigades in a future conventional war. It was, I admit, an unfair question to the noble Earl, but that question still stands today to the noble Earl, Lord Howe, as that capability is an important yardstick by which the Americans judge our utility as an ally. Not to be able to deploy a division takes us off the top table in a future conflict, and thereby our influence with our closest ally is much diminished.

What does Russia make of our internal obsessing? Surely, Russia sees military weakness and an opportunity to exploit chinks in the solidarity of NATO. President Putin would love to see nothing better than doubt over Article 5 of the NATO treaty and a fracturing of the cohesion of NATO itself. What stronger message could we send to our allies, our European partners and our potential foes than by announcing a rise in our defence spending? That 0.25% rebalancing from overseas aid to defence would show that this UK Government took their defence responsibilities seriously, wished to retain a leadership role in Europe and yet were continuing to make a significant contribution to the alleviation of poverty worldwide. When you cannot do everything, choices have to be made, and the first duty of Government, as today’s Motion indicates, is to provide sufficiently for peace, stability and security.