The Whitehall Competition – MOD pedigree – A DefenceSynergia View

Background

The British system of resourcing the activities of Departments of State is for individual professional bodies to set out cases to the Treasury of what the perceived threats to their tasks are and likely to become, what resources they have and what they perceive they will need, in what might be called ‘The Whitehall Competition’ for taxpayers money. In this competition, there are supporters and some ‘grey’ activities as described recently by the First Sea Lord & Chief of the Defence Staff (CDS) in hearings of the House of Commons Defence Select Committee (HCDC).

Departments of State rely on supporters to bolster their case; these are Politicians, Media, public opinion and, if possible, other departments. Success is measured when a good case is accepted by the Treasury. This often follows parliamentarians bowing to well-funded lobbyist pressure, the public understanding the issues at national and local level and the media. The competition has become increasingly more intense with the limitations being available public resources and an increase in the number of cases being made.

The Ministry of Defence (MOD)

Over the years the MOD has been a ‘loser’ in this competition as demonstrated by the constant low level of percentage of GDP they are allocated. A previous Chairman of the HCDC, Julian Lewis MP has been a strong advocate of the need for an increase in Defence spending over the years and has compared the MOD allocation of 2% with the Health allocation of 40% today. The HCDC’s current chairman, Tobias Ellwood, has seen the internal struggles that the MOD has in managing within its resources and in the last 2 sessions implored the CDS & First Sea Lord to ask for more.

The MOD line to take is, ‘of course we would like more BUT we are managing and won’t ask.’ This is a strange stance when MOD and the Chiefs of Staff are regularly highlighting the increased threats. Their position seems now to be based on:” our Allies can make up shortfalls” whereas a look at recent history demonstrates that Allies often have National self-interests that do not prioritise the UK’s requirements.

Before Sir Stephen Lovegrove left the MOD to become National Security Adviser (NSA), he stated to the HCDC that MOD did not have the resources it required to do its work. The Prime Minister recently authorised a circa £16bn boost to the defence budget which filled some of the gaps and in the view of CDS this gave the Department headroom to make its transition to the age of “cyber warfare”.

However, there remain areas where the systems and platforms in service lack mass, are deficient in force-multiplying additions as well as lacking skilled and trained personnel. In other Departments of State – like the NHS – there are shortfalls too, but these are usually well known by the public, politicians, and the media. As a result, perhaps rather cynically, they attract extra resources to placate a perceived political backlash at the polls.

In Whitehall, the obvious ally for MOD in their task is the Foreign, Commonwealth and Development Office (FCDO) but their relationship has traditionally been competitive – openly admitted in all levels of MOD. It is almost certainly probable that the Armed Forces case to the Treasury has not been as strong as other Departments. There can be reasons for this. For example: Defence issues are complex, far less well known, less interesting and, generally, misunderstood by the general public. Additionally, service advocates spend little time in appointments in Whitehall. It may also be a political truism that ‘there are no votes in defence’. Recent stories indicate that influencing parliamentarians is a big business that is both expensive and ruthless.

Remedial Action

A closer examination of the structure, culture, and processes within MOD indicate that the organisation is based largely on a post WW2 requirement and is not fit for purpose in the 21st century for the following reasons:

(a) The Defence Resources Budget (DEL) is divided between the RN, Army, RAF, and Civil Service. This ensures that inter service rivalry is sometimes damaging to the procurement of Kit that is necessary to Joint endeavour. There are also now 2 other areas of spend and, therefore, competition: Space & Cyber.

(b) Inter-service rivalry promotes competition for promotion that is valuable in the early years of a Service career but at the higher levels of the organisation loyalty to one Service needs to be replaced by mindsets to achieve Joint results.

(c) The Procurement budget that the MOD manages is large and complex. The skills to achieve efficiency have been lacking as evidenced by the annual NAO reports to the Public Accounts Committee. These highlight the problems that historically have never been addressed. In this area the uniformed Armed Forces contribution is limited, the remedial resources absent and the relationship with the supply chain rarely close enough to allow working in teams. The responsibility for acquisition may not lie with CDS but his people must perform with the kit provided – substandard or otherwise. The input from him is crucial to operational effectiveness.

Against this background of limited resources, the Armed Forces have had to make difficult choices. Not just gapping capabilities but managing the uncertainty of staff who are overstretched due to ill thought through redundancy programmes leading to limited skilled replacements being available. This, in turn, impacts on operational flexibility and stress on personnel when plans change due to uncontrollable events. Some of these decisions have adversely affected operational capabilities.

When it comes to our ‘People’ the variety and complexity of the environments and tasks undertaken by Armed Forces personnel currently requires 300 career structures. The terms & conditions within all the 3 Armed Services differ and can seem strange when joint service highlights the differences – for example: past joint service in Afghanistan or currently onboard HMS Queen Elizabeth. The promotion structure makes the option to resign at the transfer from single service to joint senior management attractive.

With the increasing complexity and need for deep specialist training and experience it is strange that the retirement age is kept at 55 when the national retirement is 65 – or in the case of judges 70. The exodus of trained personnel at 55 from the services has consequences of loss of experience & expertise but it also requires more recruitment to maintain numbers. There is also a cost in assisting the leavers to start training for second careers that have no benefit to Defence. The financial savings here would seem to be considerable, later pension payments, lower recruiting expenses and possibly a lower need for resettlement services. Additionally, there is a very questionable churn when Civil Servants and uniformed personnel move into the employment by defence contractors.

There seems to be a lack of standard Financial Accounting practices used by the MOD which is a known to be a source of the financial mismanagement of their cash flow and procurement.

The MOD seems to be the least transparent of the Government departments in that it restricts its people from interacting with the public.

Conclusion

There might be initiatives to correct these faults that are already being considered by the MOD to enhance Armed Forces capability and lethality and that make the task of those who serve more rewarding and less onerous. If so, let us hear what they are? In the interim would it not be prudent of MOD to better inform the taxpaying public who finance them? Perhaps they might conduct in a ‘narrative’ to the public