26 Mar 24. UK Defence Committee discerns MoD budget reduction in real terms. The UK Defence Committee maintained that the UK Defence Secretary Grant Shapps “suffered massive defeat at the hands of the Treasury” in 2024/25 budget.
In a UK House of Commons Defence Committee hearing on 26 March 2024, the Secretary of State for Defence, Grant Shapps, was grilled over the seeming lack of funds allocated to the Ministry of Defence (MoD) in the recent budget announced earlier this month.
Scrutinising the year-on-year figures between 2023/24 and the forthcoming 2024/25 budgets in the so-called ‘Red Book’ – an analysis of the economy and a summary of the budget allocation – the Committee discerned a noticeable “reduction in real terms.”
Mark Francois, one of the more vociferous voices in the Committee, cited the Red Book noting the budget had fallen by around £2.5bn ($3.15bn).
This shortfall equates to the figure due to be spent on various forms of military support for Ukraine in its war against invading Russian forces. The UK Government prides itself on being one of the largest contributors of Ukrainian aid after the US, having spent £12bn on Ukraine – £7.5bn of which was allocated to military assistance.
Francois argued that the £2.5bn that goes to Ukraine is not part of the UK Defence Budget “because you can’t spend the same pound twice.” If the MoD spends it on assistance to Ukraine, it cannot then also spend it on army salaries or submarine maintenance.
“So what you’ve done is you’ve suffered a massive defeat at the hands of the Treasury,” he told Shapps. “You’ve had your budget cut by £2.5bn and you’re now trying to play smoke and mirrors with Ukrainian money to pretend that your budget hasn’t been cut, when it’s been slashed.”
While the Chancellor of the Exchequer Jeremy Hunt maintained the UK’s commitment to Ukraine in the Budget, which was welcomed by defence industry observers, there is concern that the UK Armed Forces are coming up short.
Contrary to this apparent shortfall, Shapps noted that the budget for the forthcoming year was nominal – that the figure did not account for supplemental money that had been accounted for in the previous year.
“The reason why those numbers come out as misleading is simply because the previous year’s figures… includes the supplemental, the next year… doesn’t produce the supplemental. The argument is simple: you either have to include it entirely or you don’t include it entirely.”
According to Nato’s account of its members’ defence expenditures between 2014 and 2023, the alliance accounted a -4.12% setback in the UK’s annual real change percentage in 2023 – the lowest figure in that period.
Since much of the UK defence spending is international, the MoD takes a larger hit than most departments when the cost to import rises.
Equally, UK defence companies became more attractive as producers when the value of the pound dropped. This would prompt these companies to hike their prices slightly to cover the increased cost of importing subsystems.
26 Mar 24. Lords’ defence committee hears lessons for UK from war in Ukraine. Lord Ashton, Chair of the House of Lords International Relations and Defence Committee, details an ongoing inquiry into lessons from Ukraine.
Army Technology interviewed Lord Ashton, Chair of the House of Lords International Relations and Defence Committee (IRDC), to discuss the committee’s latest inquiry, one that examines the lessons learned in the war in Ukraine and their implications on UK defence and procurement.
It is the intention of the IRDC to complete the inquiry by the end of June, with the possibility for a follow-up inquiry before the end of 2024, says Lord Ashton, in the event of a late General Election
According to evidence already delivered in oral sessions, the conflict in Ukraine has highlighted the potential for conventional warfare in Europe, leading to a reassessment of the threat posed by Russia and the need to enhance deterrence measures, and underscoring the importance of resilience and preparedness in the face of hybrid threats, including cyber warfare and disinformation campaigns.
The conflict has raised questions about resource allocation within the defence budget, with discussions on reprioritising spending to address new and emerging security threats.
Lord Ashton reflected on Russia’s spending 6% of GDP, 30% of its federal budget, on defence. “It’s a massive change, and of course, that will have huge implications for Russia, in future, but it’s moving to a wartime economy.
“I don’t want to draw any conclusions yet, because one of the things we try and do is write our reports based on the evidence we hear rather than preconceived opinions, but I can’t help feeling that you underestimate Russian resilience at your peril.
“And we see that historically, but they’re also moving much more quickly than we are to a wartime economy,” said Ashton, after remarking that the UK is spending 2.2% of GDP and 5% of its national budget on defence expenditure.
The war in Ukraine has highlighted the need for the UK to adapt its defence strategies to counter hybrid warfare tactics employed by adversaries, including a focus on cyber resilience and unconventional threats. Significant attention was paid by the IRDC to the employment of drone technology in Ukraine for these purposes.
“Drones are new, in many ways, and in their uses there have been a lot of innovations, but they aren’t the be-all-and-end-all, they’re not a magic bullet, and they’re complimentary with more traditional equipment,” said Lord Ashton. “So for example, you still need ordinary artillery – drones alone won’t work. Secondly, they’re not necessarily the cheap option that everyone might think they are, because they constantly need to be upgraded to cope with the electronic warfare element, so you need a lot of R&D behind them to make them effective.”
The committee also heard evidence that UK has been prompted to review its strategic defence planning to address emerging challenges and align defence priorities with national security interests. The conflict has emphasised the critical role of intelligence capabilities and information sharing in anticipating and countering potential threats, leading to calls for improvements in this area.
“It’s very difficult to be offensive nowadays because the battlefield is much more transparent. It’s very difficult to concentrate your forces to make an attack because a whole load of drones appear out of the sky because everyone knows where you are the whole time.
“The sensing technology against your electronic communications is much increased, so you have to be very careful about your communications. That always used to be [a] benefit to us, in the sense that our training for junior officers and junior NCOs gave them much more power in decision making than the Soviet forces. I don’t know if that is still true. I suspect it is actually.“ (Source: army-technology.com)