Short sighted indeed and entirely based on saving money rather than anything to do with capability as even if the A400M were capable of successfully taking on the J’s roles the reduction in numbers of ac would amount to a severe reduction in AT capacity. With aspirations to ‘global Britain’ and operations in the Far East that AT capacity will be vital.
As you say all the other A400 users have C130s or similar to supplement and pickup the tasks that the former cannot do.