Gloomier defence spending forecast - with 30,000 cut in uniformed personnel

RUSI's Professor Malcolm Chalmers has issued a more pessimistic forecast of defence spending and personnel numbers over the life of this Parliament. The previous RUSI estimate was that the most plausible central scenario for the future defence budget is a 10-15% real terms reduction over the next six years. Their revised estimate following the Chancellor's Budget statement is that the core defence budget could instead be cut by up to 15 per cent in real terms over the next FOUR years. The number of uniformed service personnel might be reduced over that period by 30,000, with a cut in civilian personnel numbers of around 13,000.

Depending on a number of detailed assumptions and calculations, Professor Chalmers also predicts that:

  • Pay. As a result of the pay freeze, it is projected that the average cost of MoD personnel will rise by only 0.7% per annum over the next two years, well below economy-wide inflation of 2.1% per annum.
  • It is possible that the Armed Forces Pay Review Body (AFPRB) will seek to restore previous private-sector relativities for military personnel once the pay freeze ends in 2012/13, not least because of concerns over recruitment and retention.
  • Personnel numbers. Total defence personnel numbers might be reduced from 283,000 to 240,000. If spread proportionately, this would lead to a 30,000 cut in military (uniformed) personnel numbers*, together with a reduction in civilian personnel numbers of around 13,000.

Source: Professor Malcolm Chalmers, Royal United Services Institute - Prognosis for defence spending after Budget 2010Prognosis for defence spending after Budget 2010

* As of March 2010, there were 197,840 armed forces personnel (of whom 19,620 were untrained). There were also 85,590 FTE civilian personnel in post in March 2010. Source: Defence Analytical Services Agency quoted by RUSI.

Posted by BAFF 06 Jul 2010.

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