The right hon. Gentleman perfectly exhibits the cross-party basis on which we try to find agreement on such matters in Committee, and the extent to which we succeed in doing so. He is of course absolutely right.
I do not intend to speak much longer, because it is excellent to see so many would-be contributors to this short debate, but I will first refer to the question that was put to Mr Lovegrove. We asked, basically, when the point will arrive at which an organisation can truthfully say, “We are just about as efficient as can be and, indeed, any further ‘savings’ that we make must amount to cutting into the bone, having already cut through the flesh.” The permanent secretary’s response was as follows:
“There may be a moment at which that happens. It is not on the horizon right now. There are certainly efficiency savings that we can get at in the Department, and our focus is on doing that and seeing whether or not we can go even further. It is only at that point that we would start engaging in the kinds of conversations that you suggest.”
With the greatest respect to the permanent secretary, who as I say made a good impression and was a credible witness in our examination of the annual report and accounts, we hear time and again from within the armed forces the same underlying fear: that we are in danger of creating a hollow force, which may have exquisite equipment—perhaps not enough so-called platforms, but exquisite nevertheless—but not enough people to man it.
The trouble is that short-term cuts—I beg your pardon; efficiency savings—can lead to long-term problems. That applies in particular to training. With the carriers coming on stream, the big frigate programme having to get under way and the new F-35 joint strike fighters taking over the maritime air role from the sadly missed Harriers, which will have filled too long a gap in our naval capabilities, now is the time when we should inject maximum effort into training. Yet we find ourselves in a position—perhaps for reasons of morale or under-investment, or perhaps because insufficient emphasis is being placed on defence in our national priorities—of struggling to recruit and retain the people we need even as we cut the size of the armed forces.
The Government have not broken any rules, but they have scraped over the line by the narrowest of margins. There is no guarantee that we will not dip below the 2% figure. People usually come up with the response, “Just remember that we are the second highest spender on defence in NATO.” I remember that sort of argument from back in the 1980s, when people who wanted us to spend less on defence—we were spending quite a lot in those days; between 4.5% and 5%—said, “Why should we spend this amount on defence when Germany and so many other European countries spend so much less than we do?” The answer, as the author of a short and pithy letter to The Times pointed out, was that the countries that we were being compared with were all on our side. We have to judge our defence expenditure by
what our potential adversaries spend and what defence and attack capability they get for the money that they invest.
We do not want to engage in a race to the bottom. We do not want to preen ourselves on doing a good job because people on our own side are spending even less than we are. Our percentage expenditure on defence is lower than it has ever been—even on the new calculation, it is 0.1% lower than it was in the previous financial year. Something has gone wrong with our scale of national priorities, and the purpose of the Committee’s report is to draw attention to that, in the hope that the Government will renew their emphasis on their first duty: to keep our nation safe.