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Defence Secretary Hammond dismisses MoD cuts claims

By DPF Admin14th October 2013Latest News

“Senior commanders”, quoted by the Daily Telegraph, have criticised a reported £1.8bn underspend in the Ministry of Defence's 2012-13 budget.

But Mr Hammond said his critics had “no idea how the defence budget now works”.

The Ministry of Defence described the complaints as “financially illiterate”.

In May 2012, Mr Hammond told Parliament the MoD had finally balanced its books for the first time in a decade, and said the £38bn “black hole” he blamed on the previous Labour government would be eliminated.

In recent months, tens of thousands of jobs have been cut, bases closed and equipment contracts cancelled.

'Unnecessarily hard'

According to the Telegraph, the MoD's accounts show it spent £37.7bn of its £39.5bn budget in 2012-13.

The unspent £1.8bn reportedly included £250m from the budget for new equipment, and £200m from the wage bill which was saved because more personnel than expected chose to leave.

The paper quoted one “senior MoD” figure as saying: “Philip Hammond is being overzealous in his pursuit of austerity at the MoD. His cuts to the budget have been unnecessarily hard.”

Another senior military officer told the paper: “The MoD can hardly expect the Treasury to increase the budget for capital equipment when we can't even spend the budget we've been allocated. It just makes us look incompetent.”

But in his statement, Mr Hammond said: “These retired 'senior military figures' are presumably the same people who presided over an out of control defence budget that led to the previous government sending troops into battle without the proper equipment needed to protect them.

“They clearly have no idea how the defence budget now works. Instead of having to delay and cancel programmes as in the past, we now budget prudently and then roll forward any underspend to future years, allowing us to place new equipment orders.”

'Get a grip'

An MoD spokesman said the underspend was the result of “better control of equipment projects, the release of contingency funds as projects mature and a conscious decision not to spend money on contracts until we need to”.

“Rather than rushing money out of the door for the sake of it within a financial year, we are committing money as and when projects require it.”

Mr Hammond was heckled at the recent Conservative Party conference by a retired Army colonel unhappy at plans to axe the second battalion of the Royal Regiment of Fusiliers.

Shadow defence secretary Vernon Coaker said it was clear senior military figures had “grave concerns about the management of the defence budget and the ability of ministers to take tough decisions”.

He added: “Morale amongst our troops and their families is at an all-time low. Philip Hammond needs to get a grip. He looks like an out of touch defence secretary and confidence in his leadership is rapidly diminishing.”


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