Originally Posted by
Bob Viking
And the last time I went to France before Brexit (2011) I got €1.06 to the £.
BV
Originally Posted by
Biggus
Let's try and add some perspective to this. I've got these figures through a very quick search on my phone, so they might not be totally accurate, or both from the same financial year, but the principle is sound - and no doubt someone will correct me (hopefully politely) on the numbers.
Defence Budget £48 Bn. Amount spent on procurement £12 Bn.
So it would appear that only about a quarter of the Defence Budget is spent on procurement - and not all of that is American kit.
So, if we go for a period of expansion. Recruiting and training more soldiers, sailors and airman, and then paying them, the cost of that is going to be funded in pounds! Maintenance of current facilities in the UK,and possible expansion, pounds again. Warships built in UK shipyards, pounds. Training more pilots - pounds.
Yes, much of the high tech kit we buy these days is American, so the exchange rate WILL matter. But it won't impact all of the Defence Budget, and orders might be stretched over a longer period to compensate for the higher unit costs.
Best I duck back out of this now.....
In 2011 the USD/GBP rate was approx 1.62 USD per GBP (not knowing the month of your trip I cannot be more precise). So a 32% decrease in th eexchange rate in that time, of which 29% of th edecline was in the last 7-years since the Brexit referendum was announced.
https://www.exchangerates.org.uk/GBP...tory-2011.html
The point being that as anybidy doing defenc economics will know, the UK is in a hole and it is a long run trend that is not getting better.
https://www.poundsterlinglive.com/ba...gbp/GBP-to-USD
The self inflicted wound of Brexit has made things even worse in the last several years, i.e. on top of all the other woes that come from running a persistent current account deficit and relying on the charity of others. This has very obvious real-world consequences to defence, especially when lusting after the shiny shiny such as P8, E7, and much of the embedded systems in pretty much everything.. It also has consequences for operational costs (oil, fuel, lubes are all priced in USD - remember the days of slow steaming ?), food and munitions (all predominantly composed of USD costs). Then given that a large chunk of the defence budget is personnel costs (present & past) and the ever-lower GBP results in imported inflation, these too become more costly.
Dreaming of expansion is all very good. Paying for it on this trajectory is something else entirely.