David Cameron, the pension and that 2% defence budget.

[Al R]

It seems he wants to include the military pension in it, to bolster it up. You might need to pay to read this.

UK looks to pad out defence spending - FT.com (http://www.ft.com/cms/s/08e9e07a-c746-11e4-8e1f-00144feab7de,Authorised=false.html?_i_location=http%3A%2F%2F www.ft.com%2Fcms%2Fs%2F0%2F08e9e07a-c746-11e4-8e1f-00144feab7de.html%3Fsiteedition%3Duk&siteedition=uk&_i_referer=)

[Corporal Clott]

Unable to see your link Al as I'm not a subscriber! http://www.openscrolls.net/forum/images/smiles/icon_skint.gif

[darkroomsource]

Why do we care about 2%?
Since when did we decide that we should let other countries tell us what to spend money on?

[Toadstool]

Why do we care about 2%?
Since when did we decide that we should let other countries tell us what to spend money on?

I may be wrong, but we have criticised other countries in the past for their poor spending on defence as part of their commitment to NATO.

The fact that we may be about to dip below that 2%, and that our politicians are trying to find ways to spin this, shows us that we can no longer dictate to others from a position of strength.

[ShotOne]

Can anyone really question UK commitment? Only four members now meet the 2% target and they include Estonia and Greece - which is lovely except it's 2% of not very much. Thanks to present govt's financial competence, our % is of a very large and increasing amount.

[Dan Dare]

With prostitution and street drugs being used to bolster the GDP fiction it seems HMG have been hoisted by their own petard. Want more jets? Better visit the red-light district so that the military finances can be improved.

[Courtney Mil]

Why do we care about 2%?
Since when did we decide that we should let other countries tell us what to spend money on?

No one is telling anyone what to spend. The 2% figure is a NATO goal (or even a guidelin) that the Council believes is a fair contribution from member nations to support the NATO infrastructure in order to maintain the collective security offered by Article 5 and to service the other articles of the Treaty.

If nations sign up to the Treaty and then fail to pay their way, they are simply freeloading. The UK has been rightly critical of nations doing that, now the Government is cynically and, frankly, somewhat obviously trying to get away with their own form of "tax evasion", if you see what I mean.

Some may think that any excuse to make cryptic cuts is self-justified. But watch out. Gather all those disparate budgets under the Defence umbrella now, and the seemingly larger Defence Budget will simply become a bigger target for domestic cuts.

Come on, guys, this is such an obvious load of bollocks. Are we taken in by it? Do we really think we are being dictated to by other countries?

[darkroomsource]

If we're not being "dictated" to, then why are we one of the few that ARE putting in 2%?

List of countries by military expenditures - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures)
and
Military expenditure (% of GDP) | Data | Table (http://data.worldbank.org/indicator/MS.MIL.XPND.GD.ZS)

[Al R]

CC,

Here you go. Rather than engaging with the problem now, this shameless accounting fudge will only allow further dilution. In a few years, it'll give the state more scope to trim the budget - at a time when (particularly at the moment) we should be spending, if anything, more.

Voxpop, if the military pension has always been by prerogative instrument, does this mean that now changes? I assume that the FT writer has got the terminology slightly wrong, it isn't 'just' the war pension being bumped to defence.

David Cameron has asked ministers to investigate if the intelligence agencies budget can be counted as “defence spending”, as Downing Street eyes creative accountancy to head off US criticism of military spending.

Amid anxiety in Washington that Britain’s defence budget will soon fall below Nato’s target of 2 per cent of gross domestic product, Mr Cameron has asked whether he can boost it without actually spending more money. Oliver Letwin, head of policy at Number 10, has been asked to consider what kinds of spending can be categorised by Nato as “defence” expenditure in order to keep the UK close to the 2 per cent target, one government figure said.

“If we need to get to 2 per cent of GDP, there is a question of whether you can increase overall spending by counting funding of the intelligence agencies as defence spending,” he said.

A second government figure confirmed that officials were looking closely at what Nato classifies as defence spending to see if different member states include different elements to meet their target. The future of Britain’s shrinking war chest has burst into the open as a politically sensitive issue despite efforts by politicians to avoid becoming embroiled in yet another awkward budgetary issue before May’s general election.

US officials — including army head Ray Odierno — have been unrelenting in their criticism of the sliding UK’s defence budget. The US sees the Nato target as symbolically critical: Britain is the only large European Nato power to meet its commitment to the alliance.

Sir Nick Harvey, a former Liberal Democrat defence minister, said he was told to expect “all kinds of dodgy weaving and creative accounting” when Britain’s defence spending is expected to dip below the 2 per cent target next year.
Ministry of Defence officials have already managed to boost the amount included in Nato calculations significantly this year. The ministry is to add war pensions, worth slightly more than £800m annually, to its Nato submission for 2015-16. This means UK spending will just meet the 2 per cent commitment this year.

UK defence expenditure could also be officially increased if troops are called on to be deployed overseas in greater numbers than anticipated. The Treasury has about £500m allocated for such an eventuality. Britain’s three intelligence agencies — GCHQ, MI5 and MI6 — are jointly funded from the single intelligence account, with the precise breakdown of spending classified.

In 2013-14 the SIA was allocated just over £1.9bn. It is likely to be one of the few national security budget lines protected in the next parliament. Nato pointed out that the alliance’s agreed definition of defence spending could only be amended by a consensus of all 28 members but there appears to be plenty of scope for flexibility in its interpretation.

GCHQ, for example, works very closely with the British military. The UK’s mission in Afghanistan, part of a Nato-led operation, involved the use of tonnes of GCHQ equipment. The UK’s contribution to the anti-Isis coalition is also heavily dependent on the agency.

Other Nato nations have also bent the alliance’s rules on calculating their expenditures. France only stopped including the gendarmerie in its defence metrics in 2009. Countries such as Greece, Nato critics say, flatter their statistics with massive pension commitments.

Sending large numbers of troops on UN peacekeeping missions — something the UK has not done for years — has also become a useful accounting wheeze for some nations: troops on deployment are paid for by the UN, allowing Nato nations in effect to double-count the numbers when it comes to costs.

The US has been critical of Britain’s defence spending plans: none of the main parties has promised to maintain the 2 per cent of GDP spending into the next parliament.

Samantha Power, the US ambassador to the UN, appealed on Tuesday to European governments to spend more. Conservative MPs will press home that argument in a Commons debate on Thursday. Mr Cameron has said the UK meets the Nato target and presided over an alliance summit in Wales last year where he persuaded other leaders to commit to spending 2 per cent of GDP on defence.

The prime minister hinted at his thinking on Tuesday in an interview on LBC radio. Asked about prominent figures raising concerns over defence spending, Mr Cameron said: “I have responsibility to make sure we make the right decisions about defence and other security spending. I look at these things in the round, so I am also concerned about the budget for MI5, the Secret Intelligence Service, GCHQ, counter-terrorism policing. To me all of these things are part of our national defence.”

Michael Fallon, defence secretary, will come under pressure to reaffirm Britain’s commitment to the 2 per cent of GDP target on Wednesday when he holds his first meeting with Ash Carter, his US counterpart, in Washington.

[NutLoose]

The prime minister hinted at his thinking on Tuesday in an interview on LBC radio. Asked about prominent figures raising concerns over defence spending, Mr Cameron said: “I have responsibility to make sure we make the right decisions about defence and other security spending. I look at these things in the round, so I am also concerned about the budget for MI5, the Secret Intelligence Service, GCHQ, counter-terrorism policing. To me all of these things are part of our national defence.”




I still remember him standing on the Ark Royal telling the chaps they are doing a spiffing job whilst he had already decided to scrap the ship on its return from its cruise.
No doubt they will throw everything into the pot and call it defence from Selly Oak to the intelligence agencies thus pre election being able to announce an increase over the 2% in defence spending whilst actually reducing it.

It's okay for him bleating on about the intelligence agengies being essential, but at the end of the day, all the intelligence in the world is worth the square root of F all, if you have nothing to back it up with and act on the said information.

[Bannock]

From Mr Fallons speech today in Washington.

"You want to see an end to the decline in Europe’s defence spending that has a quarter of the alliance spending less than 1% of GDP on defence, and 20 countries spending less than 1.5%.

So do we."

Link below

https://www.gov.uk/government/speeches/in-defence-of-a-rules-based-order-transatlantic-security-co-operation-in-a-dangerous-world

I hope this does not come back to bite him in the arse.

[Melchett01]

Don't worry Bannock, if it does, I'm sure Mr Fallon won't feel a thing assuming he's carrying the usual teflon-coated rhino hide posterior that most of them seem to have these days.

Including pensions could, it strikes me, be hypothetically a very dangerous move. At the moment the AFPS scheme is unfunded, in that it meets its liabilities out of general government expenditure and is unrelated to the rest of Defence spending. For all the criticism of the AFPS being unfunded, at least it means it gets paid regardless of what the rest of the Defence budget is doing.

But if you try to get creative with the accounts and you suddenly decide your military pensions are going to be included in the overall figures, what's to then stop them cutting pensions further still on the grounds of affordability within Defence spending limits? If they are part of an overall fixed Defence budget surely that opens them up to attack and cuts as required? I can imagine the conversation now "sorry CAS, but it's either flying hours and ammo or pensions, we can't afford both".

I can't see the intelligence services being keen to come under Defence in funding terms as it would lead to all manner of chaos and discussions about primacy, legal squabbles and arguments about independence. However, if you're going down that route, then scrapping DFID and splitting it between FCO and Defence makes perfect sense as the tree hugging side of DFID sits perfectly within the broader FCO remit, but the military is often called on to support DFID and FCO objectives by setting conditions to enable future DFID / FCO activities.

[Bannock]

Not worrying Melchett. Past caring about what he has to say. Just cognitive off the fact that not once was 2% mentioned. Infact he appeared to hint that 1.5% is the new 2%.

[Just This Once...]

Apparently he said:



Once more we in the UK are leading by example.

We are one of only four countries already meeting the 2% target.

We exceed the requirement to spend 20% on new equipment.

[Biggus]

MPs have approved a backbench motion calling on 2% of GDP to be spent on Defence:


BBC News - Nato 2% defence spending target should be met, MPs say (http://www.bbc.co.uk/news/uk-politics-31857044)

Good news one would think, until you realise that:

a) The result is not binding on the government.

b) Just 40, yes 40, MPs voted on the issue! :ugh::ugh::ugh:


Also note the comment from the Shadow Defence Minister!

[Bratman91]

At last, something positive and worthwhile that we can do to help! I like the idea, and it will give ex-service personnel from a bygone era an opportunity to support OUR red-light districts instead of those in Malta, Singapore and Hong Kong. But are they up to it?

[Rosevidney1]

It is distressing for me to compare and contrast the numbers of HM Forces today to when I retired in 1980. The so called 'peace dividend' has allowed politicians of whatever hue to reduce a once proud and global force to a shadow of its former self.

[ShotOne]

Get over it, rose! Barring the most shattering world developments we're not going back to 1980. And regardless of who wins the next election there's no shower of gold coming.

Perhaps we should have a serious think about how the money we do get is spent. The new carriers, for instance, come in at £3.1 billion a piece, and counting. To give that some context, the largest lmost modern container ships, the Triple E class, 120 m longer cost £123 million. We've just got to get a handle on cost.

[Lima Juliet]

The last time we tried to use a container ship as an aircraft carrier it didn't go so well...

http://www.naval-history.net/FpMNAtConveyorBurnt.JPG

...One would hope that the extra £2.9Bn makes the QE class a bit more of a war goer than an exocet-magnet like ANTLANTIC CONVEYOR. :ok:

[Willard Whyte]

shower of gold coming

Just, don't type that in to Google...

[Melchett01]

Surely it will just bring up a return on Greek mythology - Danae and Zeus? Or is there something else I might have missed?

[ShotOne]

Leon, at the risk of pointing out the obvious, you may recall that ships with HMS in their title didn't actually cope with missile hits any better. And they weren't loaded to the roof with jet fuel and cluster bombs! But £2,900 million ought to buy a reasonable fire defence system.

To translate that to a serious point, does it matter? IS/Taliban/pirates offer no serious threat to her and if we decide to invade Russia, all the damage control systems ever invented won't allow her to survive a nuclear missile.

[sbdorset]

Selective data re Atlantic Conveyor. I was on Atlantic Causeway which was successful! Choose your data to suit your argument - bad as all politicians.

[NutLoose]

And a lot of my mates were on the Conveyor.

[TURIN]

According to this...

UK GDP 1980-2010 (http://www.ukpublicspending.co.uk/spending_chart_1980_2010UKb_11c1li011lcn__UK_Gross_Domestic_ Product)

UK GDP has risen from £200M to £1400M

I'm no economist but 3% of £200M is substantially less than 2% £1400M isn't it? (£6M & £28M)?

But according to this...

Public Spending Chart for United Kingdom 1980-2016 - Central Government Local Authorities (http://www.ukpublicspending.co.uk/spending_chart_1980_2016UKb_14c1li111mcn_30t)


...defence spending has risen from £10M to £40M. :confused:

I have no axe to grind here but all of the information should be available for discussion should it not?

Maybe I'm just carp at maths. :uhoh:

[Onceapilot]

TURIN

You are carp! It is £Billion not £Million;)

OAP

[Party Animal]

Onceapilot beat me to it but I was about to mention that TURIN's spelling was worse than his maths!;);)

[Heathrow Harry]

I think I read that Defence is around 8% of cash out - which is NOT the same as GDP

[ShotOne]

"...its Billion not Million"! Turin might perhaps be forgiven, considering the casual way the government toss these enormous figures about -most folk simply can't relate to them to anything meaningful. Perhaps kit should come with price tags with all the zeros. Or better still a comparison."..this missile costs a nurses salary for twenty years"

[Bannock]

From the Nato Web site on the 2% rule post Wales Summit

Hit the indirect funding Tab.

http://www.nato.int/cps/en/natohq/topics_67655.htm?selectedLocale=en


Allies currently meeting the two per cent guideline on defence spending will aim to continue to do so;
Allies whose current proportion of GDP spent on defence is below this level will halt any decline; aim to increase defence expenditure as GDP grows; and will move toward the two per cent guideline within a decade.
Aim and will are two very differant words.
So the commitment was not to stay at 2% but aim to. If we do dip below we give ourselves a decade to get back!

[dervish]

Perhaps kit should come with price tags with all the zeros.

IIRC they tried this once and encouraged us to report if we thought it could be bought cheaper. Some wag challenged the cost of a section radio saying it's cheaper out of Maplins. A procurer wag bought a pair of kids walkie talkies for £40 with his MoD credit card and had them delivered. leaked like a sieve, only had one channel and no crypto but met the "80%" test. Careful what you ask for.

[Hangarshuffle]

Poor taste to show the burnt out picture of the AC and use it in your argument. it'll be like last week to some people who read these pages so watch and think about what you post and mock.

[ORAC]

Ex-Minister: UK Needs $9B Annual Boost (http://www.defensenews.com/story/defense/policy-budget/budget/2015/03/14/britain-defense-boost-gdp-nato-2-percent-shortfall-fallon/70272008/)

[Whenurhappy]

I heard the intelligence agencies integrated budget described as 'equivalent to an MOD rounding error'. In other words, even if the SIA vote was included in the MOD allocation, I doubt that it would make any difference in the overall percentage of MOD expenditure

[skua]

Notable that on today's Andrew Marr Show AM asked Osborne why there was no longer term commitment to the 2% minimum. He squirmed and evaded the question. If it had been Paxo, he would have continued until there was blood or tears on the studio floor. Marr, being too much of a gent, merely moved on to another topic.

[ShotOne]

I'd very much like more money spent on defence but the link referring to a £6billion "shortfall" is erroneous. Just because the economy booms, or because somene insists (insanely) that drugs and prostitution has to be included in the figures, does it mean we have to go out and buy a load of kit that we weren't planning to buy just to get to the magic 2%?

Greece are beating the 2% figure (lovely boys!) ...unfortunately that amounts to a level of air power roughly on a par with Bruntingthorpe.

[GOLF_BRAVO_ZULU]

I think you are assuming there isn't already a shed load of kit that we do need but keeps getting deferred because the money keeps getting reallocated. There will be stores currently snail crawling through the manufacture/repair lines that are in a low availability state in the supply system. They will be trickle delivered because the money isn't there to pay the Contractor faster. The more time a store spends with the Contractor, the higher the unit price tends to be to cover the time dependent overheads.

We could actually spend to save but that rarely gets past the glib slogan stage.

[skydiver69]

I heard the intelligence agencies integrated budget described as 'equivalent to an MOD rounding error'. In other words, even if the SIA vote was included in the MOD allocation, I doubt that it would make any difference in the overall percentage of MOD expenditure

It might not make much difference but it does display a disregard for defence spending and a less than honest approach to the budget. What sort of message does it give our allies when it looks like we are doing the equivalent of looking down the back of the sofa for loose change in order to give the impression that are maintaining our position at the top table. I don't hear any messages from the Tories about trying to incorporate other departments budgets into the foreign aid budget for example, so why is defence being treated in such a way?

[ShotOne]

No other budget has to meet an arbitrary (that doesn't necessarily mean unimportant) external target, skydiver.

If the 2% really is crucial, there's an easy way to meet it. Vote labour. With the economy back to where it was with Balls running it, we could cut a couple of major programmes and still be spending over 2%.

[Heathrow Harry]

"because somene insists (insanely) that drugs and prostitution has to be included in the figures,"


not so insane - in the nearest couple of towns to HH Towers a substantial number of people seem to be able to afford Range Rovers, Bentley's, large houses,and lots of jewellry without means of visible support. We don't even see them at the Golf Club - not even on Hoodie Day!!!!

that cash (and I'm sure it is largely cash) is keeping a lot of legit business going - so every reason to include it in the figures

[ShotOne]

Valid point, HH. The issue is though, many other countries don't include "black economy" figures. The U.S. doesn't and I doubt the Greek govt could even calculate a figure.

[Heathrow Harry]

It's becoming more common - it really bugs the economists that when they total up all the Inputs & outputs in their models that there is a constant error due to the "black" economy. It also skews decisons on tax and spending etc

Might as well stick in an estimate even if you can only tax it at the Lamborghini dealers or through property taxes

[Bannock]

Looks like freedom fries are gone and our cousins have put French Fries back on le Menu.


France Displaces Britain as Key US Military Ally (http://www.defensenews.com/story/defense/international/europe/2015/03/19/france-displaces-britain-key-us-military-ally/25025191/)

[Jimlad1]

Really? I've lost track of how many times I've seen that type of story, all of which originate from the French who seem desperate to be loved.

I'll give it far more credence when the 5 EYES community becomes 6 EYES...

[Willard Whyte]

At least they can mix 'n' match their aircraft & flat-tops with the USN.

[Jimlad1]

Cross decking is a tired cliche. In reality beyond some occasional touch and goes, I can't think of a single nation that has routinely operated and sustained any credible number of aircraft on a foreign carrier.

To say the French can cross deck is technically true, but ultimately pointless.

[Heathrow Harry]

but very very useful in an emergency.................

[Danny42C]

I have read somewhere (but cannot quote a source) that in WWII, 75% of GDP was spent on Defence.

"Si vis pacem, para bellum": "If you want Peace, prepare for War"

The old Romans were on to something !

[AARON O'DICKYDIDO]

I think it was 50%. But I could be wrong.

Aaron.

[Melchett01]

Not sure how accurate it is or their sources / methodology, but they seem to suggest it peaked at 46% of GDP in 1943, growing from 3% in 1935.

http://http://www.ukpublicspending.co.uk/past_spending (http://www.ukpublicspending.co.uk/past_spending)

If accurate, it's interesting to note that even during the 'wilderness years' spending was 50% higher than today's politically celebrated levels.

[Arclite01]

We can always send our carriers over for comparison & support trials............

Oh no, hang on....................

Well, we can always send our air group over................

Oh no, hang on..................

Trend Alert, trend Alert, trend alert......this is no drill......:D

Arc