Congratulations to Rupert Pearce on his appointment as National Armaments Director, and it is a good sign that he has already started work. He brings experience of industry and the venture capital world. He may need his connections into the VC world, as he seeks to deliver the Defence Industrial Plan as the government struggles to find the resources to fund the means to ensure that the UK remains a reliable ally with a credible capability. Maybe he can persuade some of his erstwhile colleagues to invest in the defence of the realm.
He will have a good wingman in Andy Start who returns to his day job as the CEO of DE & S who has been acting NAD. There is plenty for Andy to be getting on with, which Commentary will return to but the bigger picture requires action at the level of the PM and the Treasury.
Whilst Industry has generally welcomed the recent publication of the Defence Industrial Strategy (DIS) – refer to Commentary 14, it is understandably impatient at the glacial pace with which the government is moving to unveil the Defence Investment Plan (DIP). Aside from the budgetary question, one of the key considerations is where will the MOD place its bets. One hundred years or so ago, the military were coming to terms with the lessons learnt during the First World War. What kind of war fighting capability was needed to defend the empire? Today the matter is what lessons have been learnt from the conflict in Ukraine?
The twenty first century version of the ‘tanks v horses’ debate revolves around crewed vs uncrewed. The risk is that the MOD and the armed forces will sit on their hands, while the rest of the world, including Russia and China, goes ahead and invests in the capability that they think they need. A second risk is that the MOD will decide that the answer to every capability need can be addressed via either drones or Artificial Intelligence. A review of post war developments in policy and thinking about military capability might be salutary.
- The Duncan Sandys review of 1957 foresaw the elimination of air power and its replacement by missiles.
- The Yom Kippur war of 1973 led policy makers to seriously question the utility of tanks, given the arrival of Anti-Tank Guided Weapons, which were widely used during this campaign.
- The Third Offset programme unveiled by the US in 2014 sought to leverage western technology to counter the rise of China’s Anti Access Area Denial (A2AD) capability.
- The advent of the Cyber & Hybrid threat was identified as the means by which Russia, China and their allies would offset the technological advantage in Precision Guided Munitions (PGMs) of the US and its allies.
- The Drone wall is envisaged by some as the way to defend against Russian drone attacks; it sounds reminiscent of the Maginot line.
Lessons from Ukraine
What can be observed about the Ukraine conflict is the pace of innovation. In the Drone vs Drone area, the life cycle of a particular system seems to be about six weeks. In this time the enemy will devise a counter to the latest system. How would the MOD cope with this, when it comes to placing contracts?
Tanks v Horses
The bigger picture lies in the crewed v uncrewed area. Expensive warships or uncrewed autonomous vehicles? Crewed versus uncrewed aircraft? Big decisions need to be taken regarding 6th generation fast jet capability such as GCAP and the next generation of naval capability. The opportunities for collaboration with allies and the potential for exports must not be missed.
There will always be a need for infantry and other force elements to hold ground, or to assert the will of the government. The Russians are using all of their capability to prosecute the war in Ukraine, so there is no single sensor or platform that is going to match the requirement. There is still a need for small arms and 155 mm ammunition. Neither AI nor cyber is the answer to grey zone activity, or the cutting of sea bed cables.
On 15th October, the same day as the meeting of both the European Council and NATO ministerial, the parliamentary Joint Committee on National Security published a report noting the likely consequences to the UK from the severing of subsea cables. The defence of the realm depends as much on a resilient society as it does on tanks and fighter jets.
Allies and neighbours
When it comes to collaboration and export opportunities, decisions about new programmes might be better if they are aligned with the priorities of our allies and partners. Here is an opportunity for the UK’s multinational defence industry to help!
On 15th October, NATO defence ministers met, and on the same day the European Council held a foreign affairs meeting looking at defence matters. In both cases the priority is the production of artillery ammunition, for both domestic needs and to supply Ukraine with the means to resist the invader.
The UK will, in all likelihood, be admitted to the EU’s SAFE programme – which is working its way through the Brussels process. It is reported that the negotiations between the EC and the UK are proceeding well, in which case UK industry can look forward to working on joint projects which will be underwritten by EU loans. Perhaps the City of London and the VC community might want to pay attention to how the negotiations are proceeding.
At the same time, the UK must not lose sight of the opportunities presented by the AUKUS programme. If the US is adopting a more transactional approach to the world, the UK can play its Five Eyes card to convince any sceptics in the US administration of the value to the US of an alliance built around nuclear submarines. But this will mean being forward leaning on the cost – benefit analysis. Both the UK and the US can invest in Australia’s industrial capacity to meet their own production requirements. This, of course, might require some VC participation!
Free beer tomorrow
To get things moving ‘at a wartime pace’, the new NAD will need the PM to require that the Treasury front load the funding necessary to initiate contracts. The government has been quick to hail the uplift in defence expenditure, but it will not happen in a hurry: 2.6% of GDP by 2027 and an ambition to reach 3% in the next parliament. This could mean somewhere between 2029 and 2034! Industry cannot wait that long, and Vladimir Putin shows no sign of waiting until the UK and its allies are ready.
The UK’s NATO allies are moving ahead at pace to modernize their capability. The UK risks being a laggard, and it could not then claim to be a leader in NATO. Something will have to change. The answer resides at the heart of government. The PM must lead the charge and get his Treasury colleagues to move the bureaucracy to ensure that funds are available. The first duty of government, after all, is the security of the country.
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Nick Watts
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