Refence the 'defence cuts' everybody is talking about, my understanding of the situation is as follows:
The defence budget is actually going up, slightly! However, the defence budget, rather than contingency reserves, is paying for currrent day to day operations in Iraq (I believe Gordon Brown did use some reserve money when the so called 'shooting war' was going on - but we are into 'peacekeeping' now!). This, coupled with cost over runs in procurement projects, has required the defence budget to be 'reorganised' (i.e money needs to be saved elsewhere). The only real option to save money is to get rid of some people and hardware (e.g the Red Arrows - if that rumour is actually true!!)
Thus the defence budget is 'suffering' as a result of operations in Iraq.
Now if I have got it wrong I am more than willing to be corrected by somebody out there with more accurate facts!