The British Military’s Winter of Discontent

As the United Kingdom confronts labor disputes, a struggling National Health Service, a possible recession, and post-Brexit depression, the nation’s formerly renowned military faces its own reckoning.

While British munitions and hardware are sent to Ukraine to aid in its fight against Russia’s invasion, the lack of backfilling of capabilities has placed the armed forces – particularly the British Army – at a low state of readiness.

Long considered a world-class military, the British armed forces are now stuck in a recruitment rut, with planned personnel cuts still to be implemented under the Defence Command Paper unveiled in 2021. There are significant and persistent issues involving dilapidated military housing, depleted ammunition, and poorly executed procurement programs.

While successive British governments mouth commitments and aspirational notions regarding defense, the armed forces have continued to shrink, and their stockpiles to dwindle and hardware to atrophy. Some assets are retired without even being used, while others – such as the FV430 series armored vehicles – remain in operation well past their shelf life.

Meanwhile, according to the latest National Audit Office (NAO) report on the 10-year defense equipment plan, the Ministry of Defence will need to make GBP13.5 billion ($16.3 billion) in efficiency savings over the 2022-2032 period (primarily by renegotiating its commercial contracts) in order to stay within its GBP242.3 billion ($291.7 billion) equipment budget.

As if all this were not bad enough, the prospect of additional funding to help the Ministry of Defence combat the added costs of high inflation and a weakened British pound appears nil.

Recently, a senior U.S. Army general put matters bluntly to Defence Secretary Ben Wallace: the British Army is no longer seen as a Tier One fighting force.

In short, the current environment for British defense is a gloomy one.

How did things get to this point?

The following presents a broad outline of how missed opportunities, bad planning, shoddy procurement practices, poor leadership, and general political disinterest brought Britain’s armed forces to their current state.

The World Changes and You Have to Change with It

After decades sitting outside government, a new Labor-led government under Prime Minister Tony Blair came to power and published its own Strategic Defence Review (SDR) in 1998.

At the time credited for being a refreshing, forward-thinking paper, the SDR quickly became obsolete once the 9/11 terrorist attacks occurred and subsequent British deployments to Afghanistan and Iraq took precedence. Plans were never implemented, and by 2010 the review had become hopelessly outdated, spelling out capabilities that did not fit with the British foreign policy dimension post-2001.

Under Tony Blair’s leadership, the U.K. had become involved in out‑of-theater operations ranging from Sierra Leone and Kosovo to Afghanistan and Iraq.

The latter two engagements involved medium-scale commitments for extended periods of time that simply had not been expected of the British armed forces when the 1998 SDR was drafted. Both operations exposed shortcomings in Britain’s ability to conduct prolonged, high-intensity missions simultaneously.

The overall mismatch between goals and means left British forces – particularly the Army – severely stretched by the time the next policy paper began being drafted.

Defense in a Time of Austerity

By June 2010, following seven years in Iraq and an ongoing mission in Afghanistan, the cost of the two wars to the British Treasury had eclipsed GBP20 billion ($31 billion) – with the prospect of an ever-rising price tag hanging uneasily over government expenditure-reduction discussions.

Such cost-cutting discussions dominated the thinking of the new Conservative-Liberal Democrat coalition government led by Prime Minister David Cameron.

The incoming coalition government had inherited a budget deficit close to 12 percent of GDP, ranking Britain ignominiously as the worst of the European Union’s budgetary offenders. The deficit had resulted from a combination of the knock-on effects of the global financial crisis and the profligate spending habits of the previous government.

Tackling this lopsided imbalance became a core priority of the new government, and the era of austerity unleashed by Prime Minister Cameron and his Treasury Chancellor George Osborne complicated planning for the long-overdue new strategic paper.

One of the first issues confronting defense planners was an alleged GBP38 billion overhang in the defense equipment budget. This figure pertained to the financial gap between what the MoD had ordered, what it planned to order, and what funding it had available to pay for all-new kit.

The tally seemed particularly exorbitant when juxtaposed with decades of falling investment and a considerably shrunken military. Overall, the core “real” defense budget had fallen by 9 percent from 1988 to 2008, while troop totals fell due to the “Cold War dividend” and the 1998 SDR (from 220,000-plus personnel to barely over 150,000).

With all this in mind, the incoming government faced a daunting challenge in dealing simultaneously with how to tackle Britain’s overall budgetary situation and how best to shape British defense for the future.

The outcome was the Strategic Defence and Security Review (SDSR), which critics alleged amounted to more a cost-cutting exercise than a strategic document.

Under the 2010 SDSR, the British Army shrank from 102,000 troops down to 82,000, while its Challenger 2 main battle tank fleet was reduced by 40 percent and its self-propelled artillery cut by 35 percent.

The SDSR planners opted to terminate the Nimrod MRA4 fixed-wing maritime reconnaissance capability – admittedly a boondoggle of a program – without a replacement on the horizon.

Also lost in the wake of the SDSR were the Royal Navy’s lone remaining in‑service carrier, HMS Ark Royal (decommissioned in April 2011), and the Royal Navy Fleet Air Arm and Royal Air Force’s entire inventory of 72 Harrier jump-jets (sold to the U.S. Marine Corps at a bargain-basement price of around $180 million).

The Cameron government had essentially mimicked the “10-year rule” exercised by Whitehall in 1931, under which defense budgets were drafted with the assumption that Britain would not fight a major war within 10 years.

Libya Intervention

It would take years before carrier and maritime patrol capability would return to British service, but prior to then the U.K. opted to join with allied partners to intervene in the first Libyan civil war, in support of U.N. Security Council Resolution 1973, and implement a no-fly zone.

The British contribution –  Operation Ellamy –resulted in a depletion of crucial precision-guided munitions that have yet to be fully replaced. The lessons of Operation Ellamy – that key force multipliers remained crucial and could not be retired for extended periods, that attention to NATO needed to be the core principle of strategic thought, and that sustainment of high-intensity operations required corresponding levels of munitions supply – appear to never have been fully absorbed by government planners.

More Lean Years

Under David Cameron’s stewardship, defense was prioritized only as a means of seeking fiscal efficiencies. The numbers tell the story: from fiscal years 2010-2011 through 2014-2015, defense experienced a 7.5 percent consolidated spending cut.

During this time, morale in the armed forces sagged and numerous critics charged that the Cameron government was sacrificing Britain’s security edge by abandoning its hard power element and reducing the military to a mere territorial defense force.

As a response to the criticism, Prime Minister David Cameron promised the military brass that in return for its sacrifices, defense spending would be granted a 1 percent real-term increase in equipment investment from 2015-16 through 2020. This promise appeared girded by an electoral victory in May 2015 that left the Conservatives in the majority and therefore able to rule alone.

While the government’s new SDSR, introduced in November 2015, signaled an intent to increase defense spending by around 5 percent in real terms by 2020-2021 and avoided another round of core equipment cuts, it also outlined plans to bring some capabilities sacrificed in 2010 (carrier-borne fast jets, carrier task forces, maritime patrol aircraft) back on line in future years.

Yet the government also insisted that to fund all the 2015 SDSR commitments, efficiency savings of GBP9.2 billion would have to be found within the budget, some through military/civilian “pay restraint” and some from civilian workforce reductions (generally swapped out with contractors, which offer up little real savings in cost to the MoD). Other savings would ostensibly be achieved by renegotiating commercial terms in the ongoing Equipment Plan and via a “reprioritization” of existing funding.

But no sooner had the 2015 SDSR been unveiled than the landscape began quickly shifting.

First Brexit, Then the Pandemic, and Next the Russian Invasion 

British voters took to the polls on June 23, 2016, for the so-called Brexit vote. The resulting outcomes were that a majority of voters opted for leaving the European Union and, as a result, David Cameron – who had placed much of his political capital in swaying the electorate to vote “stay” – resigned as prime minister.

Between the Brexit vote, the short- and medium-term economic uncertainty related to Brexit, and the short-term loss in value of the British pound on currency markets, the 2015 SDSR had suddenly become a dead letter.

Two prime ministers, one pandemic and a short (but sharp) recession later, a new Integrated Review and ancillary Defence Command Paper, titled “Defence in a Competitive Age,” were released to the public in March 2021.

By this time, Prime Minister Boris Johnson had surprised the country in announcing a major investment package for the Ministry of Defence – marking the largest such spending boost since the end of the Cold War. The four-year funding deal provided an extra GBP16.5 billion ($21.9 billion) for the armed forces.

Johnson pointed out in his announcement that the additional GBP16.5 billion represented funding over and above the amount pledged in the Conservative Party manifesto commitment (0.5 percent above inflation for each fiscal year in government), thus amounting to an overall cash increase of GBP24.1 billion over four years, compared to the GBP41.3 billion ($54.8 billion) earmarked for the 2020-2021 fiscal year defense budget.

The announcement softened the later blow, which involved still more cuts to the British Army as outlined within the Defence Command Paper: fewer troops, fewer armored capabilities.

Both decisions would come to look shortsighted within less than a year when Russia launched its invasion of Ukraine (dsm.forecastinternational.com/…/the-u-k-defense-command-paper-in-review).

Suddenly, peer-on-peer, industrial-scale warfare had returned to Europe and left countries across its landscape flatfooted.

The U.K. proved no exception. While committing GBP2.3 billion ($2.8 billion) in military aid to Ukraine and providing scores of anti-tank missiles, more than 200 armored vehicles, and close to 10,000 rounds of artillery ammunition, the British military has been unable to backfill what it has provided to the Ukrainian cause.

Even with sufficient financing (according to a statement by U.K. Minister for Defence Procurement Alex Chalk to the defense committee in January, funding for replenishing weapons stocks over a 10-year period has been approved), ironing out the agreements and providing industry with certainty over longer time periods become a necessity. Once those are in place, resourcing the key materials and tooling up production lines involve longer waiting times in the Russia-Ukraine War environment.

In other words, at a time when the defense of Ukraine consumes ammunition at a daily rate equal to a normal European nation’s total year-long orders in peacetime, there are no quick fixes.

Acquisition Failures Abound

Probably no area of U.K. defense comes in for more criticism than its procurement track record. The list of cost overruns, in-service delays, revised requirements, and sundry other cockups related to equipment programs is too long and too ignoble to recount.

But even amid this regrettable picture, two things stand out – both related to the much-diminished British Army.

The first involves a significant equipment budget – estimated at GBP12-14 billion ($14.5-$16.9 billion) over a decade – that has failed to bring a single new piece of equipment into service. That alone serves as an indictment.

The second issue that stands out concerns the much-criticized Ajax family of armored fighting vehicles.

The Ajax program is an evolution of the defunct Future Rapid Effects System (FRES) project, itself a colossally mismanaged equipment initiative.

The Ajax family of vehicles are intended to replace the FV432 (introduced into service in 1963) and the Combat Vehicle Reconnaissance (Tracked), the elements of which were first ordered in 1967.

The British Army ordered 589 Ajax-family vehicles in six variants from General Dynamics UK in September 2014, under a fixed-price contract valued at GBP5.5 billion.

Fast forward over eight full years, and still not one vehicle has been deemed serviceable by the MoD.

The U.K. House of Commons Committee on Public Accounts issued a report on the Ajax program on June 3, 2022. The report pulled no punches, noting that the program has “gone badly wrong,” with no deployable vehicle delivered to date, “let alone providing updated Initial Operating Capability and Full Operating Capability dates.” The report noted that the MoD had conducted a flawed management of the program from the outset (dating back to 2010) with the outlined capability requirements for the project exceeding 1,200, thereby rendering the vehicles exceedingly complex and both the MoD and General Dynamics unable to grapple with the scale of the technical challenges from the outset.

The harshest words, however, were directed at the Defence Ministry, with the report stating, “We expect an update on this when we next take evidence and a definitive decision, either one way or the other, by December 2022. After twelve years, enough is enough.”

While the MoD remains insistent on seeing the program through, it may be forced to pull the plug on Ajax with nothing to show for years of waiting and billions of taxpayer pounds spent.

Guns or Butter?

British defense planners today find themselves facing a particularly harsh environment.

The new prime minister, Rishi Sunak, is reportedly not a big proponent of defense. His government and party are deeply unpopular, consumed by infighting and scandals, and face steep political headwinds heading toward the next election (albeit in January 2025).

The economy just barely escaped a technical recession to close out 2022 and is expected to post the worst economic growth in Europe in 2023.

Inflation may have “softened” for the second straight month in December, but still stood at 10.5 percent. Added to this figure is the reality that defense inflation often comes in well above normal rates of inflation.

Meanwhile, previous plans in the Integrated Review for a high-tech, cutting-edge military shorn of outdated equipment appear upended by the return of intensive conventional fighting in Ukraine. Firepower and a strong logistical tail have once again proven to be the key factors in achieving battlefield success.

Any new funding for defense will not be forthcoming until a refresh of the Defence Command Paper and Integrated Review is completed (likely after the March budget). Even then, additional monies from the Treasury appear unlikely, as the unpopular Conservative government cannot risk being seen as indifferent to striking health workers while favoring the Ministry of Defence, a department seen by many as extravagantly wasteful with public tax dollars.

If the government opts to throw defense a bone and provides top-up funding, it will likely go to backfilling select ordnance stocks as a means of ensuring the tempo of support for the Ukrainian war effort does not wane.

This money would not, in other words, be used to prevent further exodus of crucial military engineers, pilots and other key personnel by raising incomes and addressing the deteriorating defense estate. Therefore, retention of critical personnel and recruitment of new ones will remain an issue going forward.

Opting to source munitions production from within local industry, thereby strengthening the defense sector and its downstream supply chain while creating more industrial resilience, is a popular notion across all political parties. But the reality is that much of the U.K. defense sector was whittled down by years of privatizations and outsourcing defense supply. Standing up factories and building supply chains on short notice is not a near-term solution; industry requires long lead times and government assurance of demand.

In terms of high-end capabilities, the original goal of acquiring 138 F-35 Lightning II combat aircraft appears less and less likely, particularly in light of the political-industrial emphasis and financial commitment being placed on the “Tempest” Future Combat Air System (being pursued under the newly refashioned Global Combat Air Program).

Other potential areas of capitalization where projects could be delayed, scaled down or canceled altogether include the aforementioned Ajax family of armored vehicles, the Type 32 naval frigate (delayed rather than cut), and the Guided Multiple Launch Rocket System (GMLRS) and new Mobile Fires Platform projects. None, however, presents a palatable option for any “Global Britain” ambitions spelled out in the original Integrated Review.

In the end, the most likely or logical option, depending on one’s view, may be to retain some assets currently scheduled for retirement a while longer. This, of course, would be predicated on such equipment undergoing upgrades and/or maintenance to enable them to still achieve combat effectiveness.

The hard question that the Ministry of Defence needs to be asked is whether it should continue in its pursuit of the shiniest new baubles at the expense of still-effective existing alternatives. Cutting-edge technologies providing a generational leap are one thing to consider, but fitting budgets to meet goals is another concern altogether.

As British defense planners look ahead, one thing is certain: the path before them is a hard one in which there are no “good” answers, only difficult ones.

About Daniel Darling

Dan Darling is Forecast International’s director of military and defense markets. In this role, Dan oversees a team of analysts tasked with covering everything from budgeting to weapons systems to defense electronics and military aerospace. Additionally, for over 17 years Dan has, at various times, authored the International Military Markets reports for Europe, Eurasia, the Middle East and the Asia-Pacific region. Dan's work has been cited in Defense News, Real Clear Defense, Asian Military Review, Al Jazeera, and Financial Express, among others, and he has also contributed commentary to The Diplomat, The National Interest and World Politics Review. He has been quoted in Arabian Business, the Financial Times, Flight International, The New York Times, Bloomberg and National Defense Magazine. In addition, Dan has made guest appearances on the online radio show Midrats and on The Media Line, as well as The Red Line Podcast, plus media appearances on France 24 and World Is One News (WION).

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