Monday, 13 July 2015

Holding the line: the UK Defence Budget

After five years on tenterhooks, Wednesday’s Budget speech from George Osborne, felt like welcome relief for those grown weary with worrying about UK defence and security. SDSR 2015 might not be a bloodbath, after all. The swinging axe of cuts, beginning with the last SDSR’s cull of Fixed Wing Aviation for the Navy five years ago, and since then leading to the Army’s numbers fall to 82,000, appears to have run its course.

Most importantly, the Chancellor committed to meeting the Nato defence spending target of 2% of GDP for every year until 2020. That rise means a 0.5% increase in the defence budget every year for the next decade in real terms.

Army numbers have bottomed out at 82,000, Osborne promised. A joint security fund of £1.5bn per year will be created by the end of the present Parliament to pay for increased spending on the military and intelligence agencies. The overall counter-terrorism budget – £2bn spent annually across departments, agencies and the police – is to be protected.

When the Prime Minister faced MP’s questions, David Cameron also included further assurance for the Navy’s centrepiece aircraft carrier and submarine projects, around which the future fleet – including planes, frigates and destroyers – is to be anchored.

“We made some very clear commitments about the size of our armed forces, about the successor to the Trident submarine and also the vital equipment programme, where we have the aircraft carriers and the other equipment vital to our armed services that are coming through,” said Cameron.

Whatever the savings and efficiencies Osborne might seek to wring out of Ministry of Defence spending from now on, they will mean money is allocated elsewhere within the defence budget to reboot or regenerate ailing or slipped capabilities.

“Britain has always been resolute in defence of liberty and the promotion of stability around the world. And with this government it will always remain so,” said Osborne. “So today I commit additional resources to the defence and security of the realm.”

What is most astounding, though, is to consider what this halt to defence cuts really means. We should be thankful, but pensive, about who is to thank and why.

It should be recognised that after five years of brass hats repeatedly head banging about “cutting defence to the bone” and “hollowing out capability”, Osborne is not belatedly heeding their warnings. The howls of ex Army chiefs Lord Dannatt, Lord Richards and Sir Peter Wall, and former Navy chief Lord West are not the reason.

“We will ensure that this commitment is properly measured, because we know that while those commitments don't come cheap, the alternatives are far more costly,” said Osborne.

The alternative – losing long held perceptions of Britain’s global power as well as its immeasurable diplomatic clout and influence – would indeed be dire to the UK.

As was pointed out to the Government on Budget Day: Putin is knocking at the door of Continental Europe as Nato’s first creditable threat since its 1991 victory over the Soviet Union; ISIS and the forces of Islamist terrorism run rampant in the Middle East and North Africa; and domestic terrorism and cyber threats mean the home defence of the realm is no longer that of an island.

These threats are the sensible rationale for ring-fencing defence, of course. But Washington, DC is the real root cause of the UK’s fulcrum in defence spending. The US, shocked at the willingness of its special relationship global policing partner to swing the axe at its own defence, over the past five years, stepped in, not for the first time, to warn Britain against self harm.

At the G7 summit in June, US President Barack Obama, at the behest of his worried Pentagon advisors, lobbied hard to get David Cameron to commit to meeting the 2% spend Nato commitment. Clearly he got his way.

And America is right. Not only is the logic there to boost defence against increased risk in the world, but it is Britain and America's shared role to play global policeman for the past two centuries. It is a necessary job, and nobody else, except perhaps France in Africa, is remotely as good at it. Russia doesn't have the same enviable expeditionary capabilities to use around the globe, beyond bullying its "near abroad" in Ukraine or Georgia. Neither does China: its writ, at most, ends at the Malacca Strait; boxed in by India, another regional power. As a country obsessed with its own grandiose history and managing its post-imperial self-image, the UK is right to hold to its habitual role as global diplomat and policeman.

The US faces tough defence spending constraints itself. The US Army has just trimmed its ranks by 40,000 personnel, reducing in size to 450,000.  The US Air Force (and Navy and Marine Corps) faces ongoing struggle to bring in the new F35 as near to on time, on capability and on budget as can be managed. And the US Navy faces a strain in carrier strike capability set to worsen.

With the Americans estimating they fall short by one or two aircraft carriers – vital, globally, in a crisis situation – they will want to make certain the UK has its own two carriers in service, and therefore at least one free for operations, with enough F35s to operate from it. It might require an escorting US and/or French warship, with the anorexic UK roster of 19 fleet destroyers and frigates in service, but the core carrier strike capability will be there.

So there you have it, the stretched, thin red line of UK defence holds, against the forces of modern budgetary Conservatism. This year's SDSR does not look like the rout it might have been. Indeed the defence bulwark will strengthen some in the coming years, doubtless with further nudging encouragement from our American friends. So the US can, in its way, once again claim to have played a role in riding to Britain’s rescue to rally UK defence in crisis – albeit this time just politically – saving us from ourselves.