3D - the problem is that bums won't go to SH seats - people will leave because there will be a demand for SAR pilots to fill all the seats that had been military. Generally speaking, those that are on SAR are there because they love the job and have zero interest in going to war. People are already voting with their feet which is why we have a shortage of SH pilots in the first place. If you make all SAR military you have a huge pool of crews to rotate through SH and give the guys on the warfighting frontline the respite tours they are not getting at the moment. It is a win/win situation for the MoD but they just can't see it.
One of the reasons is that their financial horizon only seems to be 3 or 4 years ahead and money won't start changing hands until 2012 at the very earliest and the full charge won't be felt until about 2017 when all the flights would have changed over. Staff officers spend lots of their time trying to magic money out of nowhere and robbing Peter to pay Paul but they are mostly concerned with the here and now and not 10 years in the future when we will be really hurting, coughing up £ 3 - 5 Bn for 66 aircrew.
Upgrading the Sea King would defer the need for a new aircraft until 2025 and, with a big fleet all brought up to the same spec, give deployability options with hot and high lift as well (Carson blades would be part of the upgrade)