SDSR – Overspent & underfunded, huge chops for a minor cut.

It should not be news to anyone that the Defence budget was a shattered ruin by the beginning of 2010, when the Gray report revealed an unfunded 10% budget deficit over the coming decade, in addition to Treasury insistence on Defence funding of the acquisition costs of the Trident replacement which represents a further 2.5% cut, and, a Treasury demand for  a 7.5% reduction as part of the Defence contribution to balancing the country’s shattered public finances. And yet people are surprised at the huge number of capabilities and platforms that got axed at the SDSR……….

Why? Did we not all spend the preceding twelve months consuming a non-stop diet of horror stories?

Think Defence very thoughtfully provided a list of the ‘culled’ resulting from the SDSR here and it and it makes grim reading:

  • Reducing the planned purchase of 22 Chinooks to 12
  • Delaying Trident for political reasons that will cost billions
  • Cancelling Nimrod MRA4
  • Reducing armour and artillery, if reports are to be believed, to the bone
  • Reducing surface vessels
  • Reducing Tornado
  • Withdrawn Harrier GR9′s
  • Withdrawing Sentinel
  • Slashing allowances and expenses
  • Setting up the armed forces for a post Afghanistan change in terms and conditions of service
  • Implementing a 2 year pay freeze
  • Reducing pensions
  • Reducing service personnel by 17,000
  • Reducing the MoD Civil Service by 25,000 which will likely result in more work for service personnel
  • Removing the External Reference group from reporting on the Military Covenant
  • Trying to convince everyone that the SDSR was a considered and balanced review (thats my favourite joke of the year)

What must be remembered here is that the Defence settlement was reduced by only 7.5% against a department average of 19%, and yet this apparently minor cut led to the loss of all of the above!

There are only two possible conclusions:

Either Fox went hatchet crazy with the result that Defence will soon be sitting on a massive and growing budget surplus as a result of unallocated budget, or;

Defence planning was utterly wrecked by ten years of budget priority free-fall whilst being embroiled in two wars whose endurance and intensity exceeded the planned operational tempo, and which the government paid for by hacking out chunks of the core Defence budget for operational costs, and accepting procurement programs which were completely unfunded.

Given that RUSI are warning that Defence will have to make further cuts of between £1bn and £2bn to prevent further overspend this blog is fairly certain which of the two possibilities above is more conceivable.

One can make honest and principled arguments against the rational for cuts in the already stretched Defence budget, this blog would wholeheartedly agree.

One can likewise proffer sensible arguments against specific cuts including the broader thrust of what those cuts will leave behind, though this blog would reservedly disagree.

However, what does not make logical sense is shock and horror that so many people, platforms, and capabilities have been axed as a result of the SDSR, this was always going to be a bloodbath if we are determined to stop playing budgetary musical chairs.

The coming horror was spelt out quite clearly nearly a year ago.

10 responses to “SDSR – Overspent & underfunded, huge chops for a minor cut.

  1. Those of us on the inside were being read the runes way before that Jed.

    I clearly remember sitting in an auditorium in one of our Command HQs in early 09, being briefed by our retiring 3* who – after reviewing the various theatres and equipment programmes – was very blunt with his assembled OF5 audience in describing our financial status as ‘a car crash’. Even then, he suggested a number of big ticket programmes that would not survive the expected change in government, with the probable ‘cadre-isation’ of certain capabilities whilst we got our house in order. It was very sobering stuff. He placed the blame very firmly on the unfunded SDR, our subsequent over-commitment to two MS theatres and the dysfunctional procurement process.

    The final part of Gen Dannatt’s memoirs sums the situation up pretty well really; ten years of over-commitment and poor management with the military (like the country in general) caught between a caustic relationship between the morally weak Blair and plain deluded Brown.

    Dr F picked up a massively poisoned chalice. We can only hope that the various AF Board’s protect the essential, whilst having a firm grip on what future capability we will actually require at the 2020 point.

    Those ‘shocked’ individuals you speak of have clearly had their heads in the sand for too long. If we cannot afford the military we want, it is clear that capability is going to be lost. I would argue it is better to put some clear blue water between old, inefficient and dysfunctional capability in the hope that, by cutting our losses now, we can better manage our resources to provide fully funded and robust capability in the medium term.

    Our 3* made it quite clear that our higher-leadership were determined to managing short-term decline in order to protect the long term interests of the Service, in terms of equipment and capability.

  2. “Our 3* made it quite clear that our higher-leadership were determined to managing short-term decline in order to protect the long term interests of the Service, in terms of equipment and capability.”

    Thank you Dieter, interesting to hear from inside the walled garden, particularly so that the chiefs were already gearing up to say goodbye to large swathes of capability in order to protect what they considered long term priorities. It would be interesting to know if they feel they achieved their objectives……?

    One other question, what is “cadre-isation”?

    Many thanks.

  3. Jed

    I would like to point out that ‘large swathes of capability’ is your term, not mine.

    Cadre-isation is taking a capability (that may be judged NOT to be essential) and maintaining a small core-expertise in that area in order to allow it’s re-generation when and if required. That core would probability be manpower expertise – with equipment holdings at a minimal. A good example were to be if we established some form of ‘exchange’ programme on French and US Carriers to maintain a cadre’ capability for eventual CVF operation.

    I suspect that they won’t know if they fully acheived their objectives for some time yet?

  4. Ah, cheers Dieter, another name for “regenerative capability”.

    Agreed on your questioning the term ‘large swathes of capability’, it is in part a reference to the mind-set of the horrified.

  5. Jed

    I prefer cadre-isation – far more succinct and military like. Regenerative capability sound like one is a Time Lord😉

    DJ

  6. Hi Jed (?) and jbf,
    On that cadre and -isation, the oldest IISS Military Balance on my shelf is the ’67 edition and from there to today the main rule was concsript domination within the armed forces (a fully professional force, like in the UK, being an exception). Therefore emphasis on
    – mobilisation,
    – not regeneration.

    Cadre can be manning at such level that 1.skeleton is in place and 2. there are enough full-time pro’s for training (from fresh, or refresher) to be effective. If the standing formation then spreads into the one being mobilised, or if it is e.g. a battalion and then three others will be called up, to have a deployable brigade… no matter.

    What matters is that you cannot mobilise without
    – having the kit, and
    – having trained with it.

    Against this background, I would say that what was meant was to use reservists/ TA as fully formed units, and have a much bigger percentage of the current kit stored (some more permanently, and some of course scrapped/ sold). Still enough to train with, without spending the first week for de-creasing (is that a term?) it.

    • Hi ACC,

      I only have the 08 edition to hand, and I struggle with some of the more technical jargon given that i don’t have a military background.

      If I understand you correctly cadre’isation can work in a fully professional military provided it relies on fully formed TA style units that will have the opportunity to train as a unit, and with the equipment………..

      Did I get that right?

      Many thanks.

      JBT

  7. Hi Jedi,

    Yes. It will work. I just tried to translate what the 3* had in mind for the UK context. If he is retiring now and has worked with European NATO armies over his career, he would be well aware of the cadre structures – cost efficient, but need enough lead time to be stood up.
    – that’s why we had 300.000 Americans and 50.000 Brits (and some French) in Germany… to buy time

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