Saturday, 7 October 2017

These Are Your Options Minister...


Twitter followers will be aware that Humphrey is on holiday at the moment, hence the reduced postings, but one story is running that is absolutely worthy of breaking radio silence to comment on. This is the news that the RN may lose both of its LPDs (ALBION and BULWARK) as savings measures under the latest miniature defence review being conducted in the Cabinet Office.

Humphrey has absolutely no idea what is, or is not, being discussed as part of this review, but given the furore on Twitter, it seems timely to try to set out what is actually going on.

The future of UK ampihbious operations?

What Is An Option?
To begin with, lets define what an ‘option ‘actually is, to help set the context as to why these reports have circulated. When the MOD conducts reviews, be it short term planning rounds or larger defence reviews, it is assigned a top level budget target that it has to meet for spending.

This figure is broken up among the different front line commands, with the Centre (e.g. Head Office) directing the percentage cuts that need to be made to each budget, in order that when combined together the new lower figure is reached.

This can be done both for ‘in year’ spending (e.g. spend less money from your current budget due to overspends elsewhere, or changes) or for multiyear spending (which looks out at the planned expenditure over the next 5-10 years.

Each Service or Command (such as JFC) will begin a process of pulling together a series of options that look at what needs to be spent and how things could be done differently (the so-called ‘defer, descope or delay). This can include spending less money early and delaying a programme. Or it could mean reducing the aspiration to do as much with the project, maybe buying less or putting less capability on it (so-called ‘descoping’), or sometimes money can slip to another financial year – for instance if the financial planners spot a bottleneck where multiple programmes all need money in Yr3 (of the 10 year look forward), they may seek to get some programmes to reduce spend, or delay them to solve a wider problem.

This delay is often taken knowing it will cause bigger problems downstream (the delay to the CVF is a classic example of this), but also in the knowledge that you face a choice of deferring and spending more, or not deferring and cancelling multiple projects to fix the funding gap.

Similar options will be put together for ships or units training and activities, or for operations. This may include ideas like scrapping a ship, or delaying and cancelling training. This is done to show the potential savings that could be accrued from not doing something, or doing it differently.

This work is brought together at varying levels of each Service, where the options are woven together to build a series of packages of measures. Some of these will be decided locally, but the money saved banked, others will be politically contentious and decided by Ministers.

The overall aim of the exercise is to produce a series of packages that can go to Ministers that set out how the money can be saved, different ways in which it can be done, and the overall impact to defence outputs if that measure is taken. If it all works, then Ministers (and sometimes the Prime Minister) approve the measures, and direction is issued to deliver as required (e.g. pay off ships, scrap aircraft etc.).

HMS OCEAN is to pay off in 2018


The LPD Leak
The issue with the leak of the ‘delete LPD’ option is that outside of those building the packages, the public do not know the context in which it is being considered. What this means is, what else is being looked at, and what are the circumstances in which it could be taken?

A lot of the work during reviews and planning rounds is built on scenarios, so gaming out what happens if you took all the money out of one budget (e.g. make all the savings from the RN), or what happens if you increased a single service target savings, in order to make headroom elsewhere for other spending (or enhancements).  Its often the case that people wish to understand the implications of what happens if you delete a capability wholesale – how much will it save across a range of areas, and what impact will it have?

For instance, in the case of the LPD option, it could be that planners want to understand how if the RN had to meet all the savings, or a bigger chunk of them, it would meet the goal and at what pain level. Similarly it could be that they want to understand how, if the UK deleted its amphib capability wider savings could be made. If you paid off the LPDs and got out of major amphibious operations, then you free up manpower, resources, you could scrap associated units allowing big savings of land release (which meets wider government policy goals) and so on. It allows you to look at the 2nd and 3rd order effects too – so if you reduce the Amphibious force, can you reduce the number of RFA tankers and stores ships if you need less fuel and supplies? How do you save in reduced long term refit and supply costs, or could you save in the long term equipment plan costings too by deleting a future LPD programme?

A single decision of this magnitude can have major repercussions throughout the RN and Defence – it would, from a financial planning perspective offer significant savings at a time when it is clear the budget is under enormous pressure. Therefore it is absolutely right and proper that planners consider every option and course of action to consider what its impact would be.

The public does not know the wider state of the debate, and it doesn’t know what other options are being tabled. Given what we’ve seen in the press so far Humphrey would make an educated guess that to meet the savings figures required, the Services are having to look at a ‘delete entire Fleet / Capability’ range of options such as ‘delete Typhoon Tranche 1’ or ‘delete Puma’ or ‘delete Challenger 2’ etc. Not because they will be taken, but because it is only by looking at this level of cuts that you realise big savings.

How Bad Is It?
We are past the era of salami slicing – shutting a squadron of aircraft early will realise a small amount of savings in manpower and airframe use. But it won’t significantly impact on the fixed overheads like training, maintenance and support – all of which are needed if you operate 1,10 or 100 of an airframe. Only by deleting the airframe do you save big money (hence the reason to delete Harrier in 2010).

The real question is how bad are things if the RN is being forced to run options that offer up the crown jewels of the fleet? To delete the amphibious capability represents a massive and damaging cut to UK capability, and would be running contrary to the National Security Strategy and UK policy goals.

To even consider getting out of the power projection game in this way indicates that things look very challenging right now. That this is being run as a potential option, even if only purely hypothetically, indicates the scale of the financial challenge facing the MOD.

Can the Army still afford more horses than helicopters?

Why Leak It?
There seem to be three reasons why options leak historically. Firstly,  those done by people who are concerned that an option will do lasting damage and who seek to influence public opinion to prevent it being taken (the so-called ‘noble leaker’).

There are those who leak a politically unacceptable option so that it can then later on not be taken, leading to widespread relief, and preventing deeper questioning of just how much had to be saved elsewhere to keep the capability in service (the so-called ‘cynical leaker’).

Finally there are those outside the Services or Civil Service who leak for reasons linked to politics. A gentle push here, a prod there, and a reminder that more money is needed elsewhere. It never hurts to curry favour with those from whom you ascended, in case you need their support in future... (the so-called ‘expedient leaker’).

A good way to determine where the leaks have come from will be the level of witch-hunt that follows the news. Previous leaks over the years have seen responses ranging from stern letters warning of dire repercussions for the leaker when caught, through to no action whatsoever. Some leakers are perhaps more equal than others...

What Happens Next?
It is inevitable that further such leaks will follow – both the RAF and Army will be keen to try and shape their own narratives over the next few weeks, highlighting where cuts may fall on their own services. But, what is key to remember is that these are options, nothing more.

It is not until the final packages are assembled, setting out what the future force structure looks like (e.g. the so-called ‘readjustments) that we will see inspired briefing and more coherent information emerge. Anything can change right up until the last minute though, so expect multiple changes, briefs and counter briefs as the Services vie for support.

There seem to be two likely outcomes to this situation though. The first is that in the New Year major force changes, significant capability deletion and potentially manpower reductions will be announced that will do deep, long term and serious damage to the UK as a global power. They will be spun as ‘enhancements and adjustments’ (so potentially some good news like keeping OPVs on) to hide the likely extensive range of very damaging cuts.

Alternatively, there could be some kind of crisis funding deal agreed as part of the budget process, whereby further funding is provided and the worst of the cuts are ameliorated. Either way, it seems exceptionally unlikely that the MOD will escape significant pain over the next 6 months.

The Defence Budget may well be growing and the UK may show how more money is being spent on defence by stretching the phrase ‘2% of GDP’ to the absolute limits of credibility. But what is also clear is that there is a significant hole at the heart of defence funding, that baring a major long term injection of cash, will require very tough choices to be made. Never has the phrase ‘a growing defence budget’ sounded more hollow.

8 comments:

  1. With roughly one flag officer oer ship, how about cutting half of them instead?

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  2. Thanks Sir H, good insight as always. The problem is clear in that the SDSR 2015 is no longer affordable, and by Fallons own admission the threats have increased in a number of areas. What seems to be missing (in the public domain at least) is the Strategic Context in which the changes are being made. Whilst the driver seems in part to be financial FX instability, it still has context, and I'm sure there are other dimensions. Having this context (at least partly) in the public domain would help with the presentation.

    For example it could be:
    - We expect a level of financial and strategic uncertainty over the next 10 years as the UK adjusts to a post Brexit world.
    - During this period the UK needs to focus on securing it's interests through focusing on UK/BOT defence, contribution to NATO and interoperability with important strategic partners such as the US, OZ/NZ/Canada, Japan and India.
    - Threats will be both conventional and also cyber, including threats to the democratic election process.
    - The UK does not expect to contribute in a large scale to an offensive operation, but must be able contribute at brigade level globally with partners with 1 months notice. In addition the UK should be able to contribute strike, ISTR, SF and support enablers.
    - Given changes to the global environment and challenges of disease etc with a growing global population, the UK needs to be able to a significant HADR force at 1 weeks notice to be deployed globally.
    - blah blah blah... but you get the idea.

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  3. If as it seems things are now at a critical financial junction, maybe it is time for all of those persons who care about the Royal Navy and wider Military to push one primary message.

    The budget for Trident to be allocated back to its original place (the Treasury) and that money to remain within the MOD budget.

    We have to make the politicos understand that their words and actions on Trident matter and that the treasury is the purse strings of their government. Trident is not a flexible military unit, it can not be called upon as part of the Fleet, it has a completely different role. So should not be seen as something it is not, an integrated warship.

    If Trident is to be continued to be funded from within the Navy slice of the pie, then it needs to have more of the pre-mentioned flexibility, (what! I hear you cry. Hear me out).

    There are 4 boats, the operational cycle at a guess, is something like:
    A) At sea
    B) Deep maintenance
    C) Light maintenance / training
    D) At readiness for sea

    Now to the flexibility part. From the design of the Dreadnought class the flexibility needs to be built in. This could be copied from the American SSGN design, Trident tubes reduced to 8 or 10, (still a potent deterrent), 6 further vertical tubes are built in for cruise missiles as well the standard torpedo tube based cruise launch capabilities, (up to 4).

    First let me say this, this is not a wishful armchair proposal based on fantasy fleets. This is an adult debate on how we maximise our limited military spend.

    Second I am not proposing putting these valuable assets in harm's way on a regular basis. But at a time of military emergency when a additional lower level deterrent may be required, i.e. another Falklands type conflict, the cruise missile armed boat could be deployed. I say could as it is not the actual but the possible that may suffice. A boat that can at a moment's notice launch up to 10 conventional pinpoint cruise missiles from somewhere in the ocean within a 1'000 mile radius. Something that may at least cause an opponent to pause for thought. Flexibility in an extremely rare but vital time in our islands defence. Remember with the design of the vertical tubes there is the capacity to have a boat with both or either weapons at readiness. As an aside our limited SSN fleet cannot provide this capability and undertake their BAU patrols as well.

    I concede that the risk would be increased on the boat in question, but when the country is in dire need, decisions must sometimes be made and risks taken with our valued assets. As an ex submariner I can say that the trade understand this, they have put themselves in the front line for over a hundred years.

    I recommend this to the house.

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  4. As far as the amphibious capability is concerned, change is on the way. Even if Albion and Bulwark are reprieved this time they will not be directly replaced. The future amphibious effect will be limited and centered around heliborne forces from one of the QE carriers, supported by 2 or 3 RFA multi-role support ships which will replace both the Albions and the Bays.

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    Replies
    1. Only in the fevered imagination of a certain 2* in NCHQ. Who doesn't seem to understand that heliborne forces can't stay anywhere long and the MRSS is a very different concept from what he assumes.

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    2. It will be a choice between this, cheap merchantile conversions or nothing at all. The fevered imagination tends to come from armchair admirals who believe that the RN is going to receive 2 or 3 30,0000 ton LHDs and morph into a downnsized version of the USN.

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    3. Armchair admirals are one thing. Shipbuilders who understand whether conversions are actually "cheap" or not - or indeed whether LPDs are expensive - are another. The people pushing MRSS tend not to be aware that each one the US bought cost $500M apiece and have limited ability to support troops for any length of time.

      Designed around another purpose they were......

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  5. The right answer IMO is to buy a RFA LHD similar to a Mistral class with additional OTH Ship to Shore connectors. This would also replace Argus. Whilst it's not the same as a full time LPH+LPD+2 LSD capability a part rime LHD+3 LSD capability is probably ok in the near term when combined with the 2 CVFs.

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