Martin questioned Ministry of Defence (MoD) chiefs on spending and recruitment during an evidence session of the House of Commons Defence Select Committee. He asked about the impact of the UK government’s plans to increase visa salary thresholds on the recruitment crisis facing the British Armed Forces.
Here’s an extract of the evidence session transcribed via Hansard:
Martin Docherty-Hughes (SNP, West Dunbartonshire): I want to take a look at the £2.3 billion of military spend aid to Ukraine in 2022 and the Prime Minister’s commitment for the same for 2023. David, what do you think of this commitment that we have made, and what funding will be provided by the Government in 2024?
David Williams (Permanent Secretary at Ministry of Defence): On the £2.3 billion for this financial year, we are not only planning on it but busy spending it. The out-turn will be around the £2.3 billion mark. As I have said previously, that covers both equipment and munitions support to Ukraine. It covers the cost of the training mission Op Interflex. It covers the cost of enhanced military activity on NATO’s eastern flank as well. It is a range of costs in support of Ukraine’s fight. We have not yet formally agreed what the level of spend will be for next year. I think the Foreign Secretary in his first outing in the Lords said he expected it to be at least the same level. That is the working assumption that I am planning on.
Martin Docherty-Hughes: Could you confirm that all additional costs are being borne by the Treasury?
David Williams: Yes.
Martin Docherty-Hughes: Does that also mean replacing equipment in the inventory?
David Williams: The bit where we remain in dialogue with Treasury colleagues is around the extent to which some of the replenishment costs of equipment that we have gifted falls to that £2.3 billion additional funding or to the core department. In the first year they were additional to the £2.3 billion. It is one of the reasons why, in that year, we out-turned at £2.4 billion. This year we are not getting additional money from the Treasury for that. Therefore, the choice for us is either to prioritise within the £2.3 billion overall or to score against the core departmental budget, all being in a world where the Treasury has, through the spring statement and the autumn statement, given us additional funding for stockpiles, resilience and so on. That is still subject to live debate, and we can update the Committee when it is decided.
Martin Docherty-Hughes: Are you accelerating equipment deliveries to our armed forces with all of that going on?
David Williams: Yes. We continue to deliver well against a range of our equipment projects. Indeed, we are looking increasingly for synergies as we think about support that Ukraine might need and where there are things that we may want to do jointly, employing new capabilities to our own forces.
Martin Docherty-Hughes: Briefly on this issue, I have two points. Are you making any considerations for a change of Administration in Washington next year which may have an impact on the United States commitment to Ukraine? Given some of the global issues we face at the moment, if there is a capability draw on our armed forces in other arenas, how confident are you about the ability to maintain that support for Ukraine in its battle against Putin?
David Williams: Let me start with the last point first. The Defence Secretary’s announcement yesterday with his Norwegian counterpart about the maritime capability coalition reflects how we are evolving our thinking, under strong US leadership, beyond the immediate fight into what the next phase of capability requirement and capability support for the Ukrainian armed forces will be over the short to medium term. The UK is leading the maritime capability coalition, but there is a range of equivalents looking at armour, artillery, air defence, electronic warfare and so on. We will have an interest in a range of those. That is a process designed and launched under US leadership in the Ukraine Defence Contact Group. There is lots of international support. I would characterise our relationship with the US to date on a range of these things as that in the UK we have often been willing to step in sometimes a little earlier, but in scale of support the US is of fundamental importance to the Ukrainians. President Zelensky is in the US at the moment, engaging with Congress and the Administration. It is not really for me to reflect on what the outcome of elections next year may be.
Martin Docherty-Hughes: David—others may want to comment—the Minister for the Armed Forces recently told us, “Our instinct is to”—accept the Haythornthwaite review recommendations—”but it is not cost-neutral.” Given the increasing pressures on your budget, which you have eloquently talked about, how would you fund these recommendations?
David Williams: We are working through the recommendations at the moment. I think Dr Murrison will be updating colleagues with a “Dear Colleague” letter shortly, and we expect to make a full response to the review sometime during the first quarter of next year. My guess is that the recommendations are unlikely to be cost neutral, or at the very least unlikely to be cost neutral in transition. Therefore, we need to think about the rate at which we introduce the changes that Haythornthwaite has recommended, which will allow us to modify some costs. That is a choice. I am not saying it is the choice.
There is a question about how we can contain additional costs within an overall workforce share of the budget. If the cost of an individual goes up, and you want to make that the same, you need fewer people overall. I do not detect an awful lot of appetite for the number of service personnel to fall beyond planned levels. For a variety of reasons, we probably need over the next three-year period—the next spending review period—to reduce the size of the civil service in the Department. That will be an element in making the overall pay bill more affordable. It is not primarily my motivation for doing it. I think it needs to be smaller, more agile and more capable to meet the requirements that the Department is facing. Obviously, the proportion of civil service pay to military pay means that you would have to make quite a large change on the civil service side to have a material impact on the affordability of the armed forces. Finally, and very briefly, you would accept that the share of the defence budget that we are spending on people is going to go up. It will be more challenging in a world where there is financial pressure in the programme than not.
Martin Docherty-Hughes: Let me ask you this. You talked about the civil service and then the armed forces. On the issue of not only recruitment but retention—Rob might want to come in here as well; it may come up on capability—what discussions have your Department had with the Home Office about the minimum salary requirement visa rule changes coming in next spring?
David Williams: I would rather write to the Committee on that topic. It is something I need to check.
Martin Docherty-Hughes: The reason I highlight my concern is that the Royal Regiment of Scotland alone has a substantial number of foreign nationals who make up the shortfall in recruitment, notably members of the armed forces from Fiji. It has been like that for a long time. The last time I looked, maybe one in five of the Royal Regiment of Scotland were Fijian nationals. If they left after a minimum period and were at the wage level of a corporal, they would probably be £2,500 under the salary threshold being proposed by the Government to take place next year. Does it concern you that members of the armed forces serving the Crown and doing their duty would not be able to meet the visa requirements?
David Williams: There are two points to that question. First—honestly, I would have to check—I do not think, that the way the Government are thinking about their salary cap or visa requirements is going to have an impact on the way in which we recruit foreign and Commonwealth trainees. My understanding is that it is not in scope, but I would have to confirm that for you.
There is a second point about whether we are paying our junior service personnel enough, which is wrapped up in the Haythornthwaite review in the concept of total reward and the value of the overall offer. Not all of it comes in direct salary.
Martin Docherty-Hughes: From what I can tell, you are saying—I don’t know if anyone else wants to come in—there has been no discussion between the Ministry and the impact of the minimum salary requirement rules at all.
David Williams: I am not saying that. I am saying that I don’t think full recruitment to the Armed Forces is a relevant consideration.
Martin Docherty-Hughes: At the moment, if you are an EEA national, not necessarily from the Commonwealth—it doesn’t really matter whether you are from the Commonwealth—you have to meet those minimum requirements. My concern is that, in the Royal Regiment of Scotland, a substantial number of Fijians leaving to do different things will not have the right to remain. They will not meet the threshold, and we will have a vacuum in the Royal Regiment of Scotland in terms of recruitment.
David Williams: I absolutely get the concern. I just do not know what the answer is. I think on this one I am going to have to write to the Committee. We will do it quickly.
Chair: We await that letter.
Watch the Urgent Question in full here.