Fox’s unfinished business

The new Defence Secretary, Philip Hammond, must stay the course on unfinished defence reforms while managing the forces that will work heavily against him.

It is just over two weeks since Liam Fox resigned as the Secretary of State for Defence and Phillip Hammond, the former Transport Secretary, was promoted into his position. What Fox has left behind at the MoD is what some have characterised as ‘unfinished business’ or a job half done (although he would have liked to have finished). This is no truer than the job of reducing the department’s budget – including the £38 billion ‘black hole’ – and enacting the cuts first set out in the 2010 Strategic Defence and Security Review.

Fox, the first Conservative Defence Secretary since Michael Portillo in the 90s, had held the Shadow Defence Secretary role since 2005 when he failed to win the Conservative leadership contest. He managed to maintain his shadow position through no more than four Labour Defence Secretaries up until the Conservative election victory in May 2010.

Now, one year on from the SDSR and over fifteen months since Liam Fox became defence secretary, the SDSR is under severe criticism, and Fox himself is gone. His departure means that the continuity of experience and direction is lost, the ‘corporate memory’ Fox possessed and gained will have to be memorised over again by Hammond. Importantly – however flawed Fox ultimately came to be – he was focused on his job at hand, which was reforming the most unwieldy department in Whitehall.

The SDSR was (and is) criticised as being Treasury-led (for experts, the worst kind of defence review), focusing on money first and capabilities last. But despite these criticisms Fox showed a gritty determination to see his work to fruition, only last month over a thousand sailors were told they would be made redundant, some only just returning from Libya. The reduction in the budget has not only come at a cost to manpower but also to equipment with the SDSR proposing extensive cuts to maritime, air and land capabilities.

A report published by Baron Levene (the Levene Review), the head of the Defence Reform Group, in June also proposed a radical shake-up of the administration and systemic practices in the MoD. The proposals included strengthening accountability of single-service chiefs while also integrating the three services under a Joint Forces Command. Affordability issues were also never too far from Levene’s recommendation including the stream-lining of decision-making by reducing the number of senior officers and civil servants.

Fox’s commitment to reform was also demonstrated with the appointment of Bernard Grey last year as Chief of Defence Materiel. Grey’s report into MoD acquisition and procurement in 2009 was a critical step in identifying the endemic problems in how the MoD bought equipment. Fox’s decision to appoint Bernard Grey was in stark contrast to the previous Labour government’s bid to suppress his initial report in 2009. Much of the current reform work going on in the MoD is centred on the ‘black hole’ – the department’s budget deficit – created through overspend on equipment projects.

This focus and determination for reforming all aspects of the British defence apparatus, however, made Liam Fox a divisive figure within the defence community and within the MoD. From the accounts of various sources, it is easy to assume that he was not a liked figure in the department, even before most people became aware of the full extent of his relations with Adam Werrity. By October of this year the cuts had begun to bite and thousands of personnel had lost their jobs. It was also clear to many experts that since Libya the political will for military intervention had become stronger after Gadhafi’s fall, even though the military capabilities would not be available to repeat a similar operation.

On top of all this Fox has had to contend with the on-going operations in Afghanistan, a corner-stone of the SDSR in 2010 and defence policy ever since. British blood and treasure has been spent and spilt more in this country than any other since the Korean War, it is hard to ignore so easily. The intervention in Libya certainly showed many in the MoD and government that counter-insurgency/stabilisation operations was not the only type of conflict Britain would fight in the future.

Liam Fox’s gross error of judgement in his relationship with Adam Werrity and his subsequent resignation may ultimately dent the progress of future reforms in the MoD. The question now is whether Phillip Hammond will pursue reforms in the MoD as vigorously as Fox and show the required leadership. What may be seen as an advantage is Hammond’s business background but equally his disadvantage may be his complete lack of military experience (whether service or political).

If we are to look at the reforms that are required in the MoD, Hammond’s business background could be what really matters. The problems of administration and procurement are familiar problems for any business looking to effectively manage its finances. The only problem is that the MoD is not a business and this is where experience in the nuances of British defence would help. The propensity for single-service chiefs to override collective interest for their own service’s interest is something that will be a stumbling block for Hammond. Setting up the Joint Forces Command and increasing the accountability of chiefs while reducing their influence will also encounter friction from those that prefer the status quo.

The future procurement of military equipment will prove equally difficult, especially the replacement nuclear deterrent and the Joint Strike Fighter. Hammond has already allayed fears (or disappointed some) by making clear that he would favour replacing Trident like-for-like. But procurement is notoriously difficult to get right, even with the best of minds – like Bernard Grey – working on it. Like all the reforms, procurement requires close scrutiny, perseverance and commitment but many defence ministers of the last decade have been lacking all three qualities.

By all accounts Hammond has been actively engaging with senior service chiefs and reassuring them that he is fully committed to defence. Understandably, in his first two weeks in office he has avoided making any grand statements or anything that could be considered controversial. His interview last week with Andrew Marr demonstrated the continuation of the Fox ideology especially on deficit reduction through departmental budget cuts while remaining committed to the armed forces.

There may be problems for the new Defence Secretary (and the Prime Minister) addressing the emerging agitations of the right-wing backbenchers of the Conservative party. This was seen in stark terms during the recent backbench rebellion on the issue of Britain’s role in the EU and a potential referendum. This group will likely be the most vocal and active if there are any more perceived negative effects on Britain’s defence capabilities. Liam Fox was able to moderate these voices as he was often seen as the de-facto leader of the Conservative party’s right. This does not exist for Hammond and these forces could be unleashed, which will undoubtedly draw in the Prime Minister.

It is too early to determine the real impact of Fox’s resignation; the questions far outweigh the answers. The bureaucratic behemoth of Whitehall will present numerous and unpredictable challenges in the reforming of administration, acquisition and procurement, changes to staffing and the ethos of the whole department. On top of this Hammond will also have to contend with the effect of budgetary cuts especially in defence capabilities and how they will effect present and future operations. The new Defence Secretary must now prove that he is willing and able to tackle these issues using his existing skills as well as demonstrate the willingness to learn the unique and often frustrating aspects of British defence policy.

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Posted on October 29, 2011, in Comment, General and tagged . Bookmark the permalink. Leave a comment.

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