I've been thinking about this over the weekend, not something I try to do very often at weekends, and I've come to the conclusion that there is method in the Government's madness. Rather than appearing to be incompetent in generating a hollow force, the whole point is to re-engineer the demographics of the Forces to save money.
Given the erosion in Ts&Cs, something that looks set to continue, I suspect they are hoping to make the Forces unattractive as a long term career thus saving money on the pay and pensions bill as people gain experience and progress up the ladder. Result, you end up with a high turnover of youngsters who are cheaper and once they've done their few years you hope to retain that experience by locking them into the Reserves. I think the net effect will be to give us a military not too dissimilar to the Swiss, with a very small number of career types who provide the professional cadre and long term leadership to a large number of less experienced, junior types and Reserves.
That the Swiss are effectively a home defence force rather than an expeditionary force means this isn't an appropriate model for the UK to copy, but given the seeming focus on driving people out I just can't think of any other rational explanation.