Defence needs revolution not reform

George Osborne’s emergency budget promised a reduction in most departmental (including defence) budgets of 25 per cent in real terms. Even without these reductions we already know from a National Audit Office report that the current planned procurement programme is up to £36bn overspent over the next decade assuming the defence budget keeps pace with inflation which it will not.

Moreover, as we also know from the MoD, it is not just the equipment part of the defence budget that has problems. Studies undertaken have shown that the cost of personnel has increased on average year on year by two per cent in real terms since the Boer War — a figure far higher than the growth in the defence budget.

If this trend is left unaltered then personnel costs will represent a steadily increasing proportion of the defence budget and will eventually soak it up entirely.

At this point it would be relatively straight-forward, as a number of analysts and think-tanks have done, to say that some capability or combination of capabilities need therefore to be cut or to argue that Britain should chose to align itself more closely with America or with Europe or with France as a way of sharing the defence burden.

Such analysts may be right — a 25 per cent reduction may mean that such assumptions are correct. However, it would be in the armed services’, the government’s and indeed the country’s interests to reflect first on how defence is undertaken and, in particular, managed in order to see whether some, if not all, of the required savings can be made by changing the way in which the armed forces and the MoD go about their business.

In the April edition of this magazine my piece Rank Nonsense and earlier pieces in conjunction with Paul Cornish in International Affairs hinted at the problems that the MoD and the armed forces have as bureaucratic entities.

Put simply, as the MoD and the armed forces have down-sized since the end of the Cold War they have become more and more top-heavy in civil servants and senior officers. This problem typifies the potential for significantly reducing the cost of defence without necessarily reducing the ability of the government to perform the defence function. This presumably lies at the heart of the new Defence Secretary Liam Fox’s pledge to reduce the operating costs of the MoD by 25 per cent. Other commentators have also argued that the MoD has problems. Lord Ashdown writing in The Times argued that if Britain still wants to win its wars it first needs to fix the MoD.

A number of analysts have called for the US Marine Corps to serve as a potential model for Britain’s armed forces — the US Marine Corps is approximately 15 per cent larger than Britain’s three armed services combined. Senior officer numbers provide an illustration of the relative bureaucracies associated with each (see table 1, overleaf).

The first thing that the government and the MoD need to acknowledge is that they are in the game of risk-management and, therefore, base their decision-making process around the management of risk. This seems to be increasingly accepted.

Secondly, they need to accept that they will not get every decision right but to choose not to choose is no longer an option given the proposed level of reduction in the defence budget.

For example, the 1981 Nott Review was probably one of the most sensible and lucid defence reviews — until the Falklands Conflict came out of left field and significantly undermined it. If the MoD’s traditional salami-slicing approach to reductions is adopted we are likely to see major chunks in capability being lost across the span of defence. Stasis is the worst of all worlds.

Third, there should be no sacred cows and no area should be left unexamined as was the case in 1998 with SDR ring-fencing both the nuclear deterrent and the Eurofighter programme.

Fourth, past failures in reform should not dissuade policy-makers from trying again. With the exception of the 1981 Nott review, all other reviews have sought to reform the defence procurement/acquisition process to finally get it right. History, and more recently the Gray report, has shown that the acquisition of equipment has not been particularly successful, despite the enormous size of Defence Equipment & Support (DE&S). To be fair DE&S have not been helped by the constant year-on-year delays and changes to individual programmes that have contributed to massive cost overruns.  

Fifth, government needs to begin to ask itself what are the core capabilities that it requires from defence. For example, there has been much commentary on the number of helicopters deployed to Afghanistan and the previous Labour government made great play on its pledge to acquire 22 additional Chinook helicopters with half arriving by 2013. The focus needs to be on what can actually be used on operations thus the question needs to be asked why keep and update the existing Puma helicopter force if it cannot operate in Afghanistan.  Why not scrap the whole fleet and transfer the air crews and engineering staff to supporting those helicopters that can be operated?

Six, sensible rationalisation needs to occur if money is to be saved and to begin quickly even if this means accepting that there are residual costs associated with contracts already entered into. There is little point keeping residual forces if they are not deployable at present; instead focus defence resources on those assets that can be deployed and maximise their usage.

Seven, the UK needs to look to where it can safely rely on partners. For example, both our European and American allies all have significant numbers of tanks and fast jets but lack (or have insufficient numbers) in other areas such as special forces, heavy lift aircraft and a nuclear capability.

So here is a starter of five areas for cutbacks which does not include DE&S:

1. Amalgamate the single service chiefs and service command posts (e.g. First Sea Lord also takes over responsibility for Fleet). The savings would include three 4* officers and some duplication in their staffs. It would also give the single service chiefs control over the majority of their services and the role of force providers to PJHQ. You could also consider eliminating or reducing the post of Vice-Chief of the Defence Staff and give the relevant responsibilities to the Chief of the Defence Staff (another 4* officer post).

2. Reduce the number of substantive officer ranks by abandoning the 1* rank and, instead give the levels of responsibility associated with it to the senior members of the rank below. It is worth remembering that only in recent times has it been anything other than a mere title in the army and navy whilst in both the US Army and US Marine Corps Colonels not Brigadiers command brigades. More generally, place a number cap on individual ranks/scales within the Ministry of Defence as a means of preventing grade inflation.

3. Look at the plethora of headquarters and consolidate. For example, you could get rid of the army’s three regenerative division headquarters since none were deemed suitable by the army when it sought to create a headquarters for Afghanistan. It is worth noting that the army has long argued that it needs three operational headquarters yet ignored the Royal Marines divisional headquarters.

4. Scrap frontline equipment that cannot be deployed on operations; for example, the Puma force. More generally, accept that our allies have significant capacity of some capabilities which we do not need to replicate on a significant scale e.g. fast jets. Therefore take the Tornado out of service leaving the Royal Air Force with Eurofighter. At the same time scrap Joint Force Harrier, transfer the remaining Harriers to the Fleet Air Arm and reduce the planned buy of the Joint Strike Fighter to only provide for the Fleet Air Arm’s requirements.

5. Pull all forces out of Germany using bases freed up by consolidations elsewhere e.g. by moving the Nimrod force to Waddington and giving RAF Kinloss to the army. This would free the MoD from employing approximately 5,000 civil servants in Germany as well as a support command with its 2* general and staff.

The above are just a few examples of a risk-based approach to reform.  While it would, perhaps, be easy to challenge each of the individual examples cited above, the point that this argument underscores is that for defence and the armed forces to survive and flourish within this ‘age of austerity’ there is a need for revolutionary change in how the MoD and armed forces are organised and equipped. In a sense, borrowing the John Major slogan of the 1990s, there is a need to go ‘back to basics’.  

Given the financial context this would appear to be a perfect time for change. Writing before the Second World War Heinz Guderian, father of the German Blitzkrieg, wrote in his introduction to Achtung-Panzer  ‘[i]t is a love of comfort, not to say sluggishness, that characterises those who protest against revolutionary innovations that happen to demand fresh efforts in the way of intellect, physical striving and revolution’.

Change is always an unsettling and often unappealing option for an organisation in decline but it should also be remembered that change is not a new phenomena. Just over a century ago Admiral Sir John ‘Jacky’ Fisher was appointed First Sea Lord, the professional head of the Royal Navy, and in the six years that followed the navy was transformed.  

Whilst he is mainly remembered for HMS Dreadnought, the first of the all-large calibre gun battleships, he actually began with educational and personnel reform (such as the Selborne Scheme) to meet the changing requirements of naval warfare. He also attempted to transform the navy’s approach to war with a radical redistribution of naval resources. This involved a significant reduction in the overall size of the fleet, including the scrapping of approximately 250 ships, and the redistribution of the remainder to bring them into line with Britain’s strategic requirements.

Even these radical changes proved insufficient and the deficiencies of the British fleet at the Battle of Jutland in 1916, where they failed to destroy a smaller German fleet, have been attributed, in part, to Fisher’s failings — including his fascination with the battlecruiser, the lack of change to the command and control system and the loss of the so-called Nelsonian tradition.

There was much discussion in the 1990s about a ‘Revolution in Military Affairs’ whilst in industry there were significant changes to the way companies structured themselves with a major effort to reduce the layers of management.

Perhaps now is the time for a Revolution in how government works. There is no better place to start than the MoD.

Andrew Dorman is a Senior Lecturer in the Defence Studies Department, King’s College London, based at the Joint Services Command and Staff College.  He writes here in a personal capacity.