When Liam Fox took office as defence secretary in 2010, he instituted a programme of reform, both in the Ministry of Defence (MoD) civilian staff and in the three Services. That drive for defence reform was underlined by the disclosure that the forward defence programme over the next five years was thought to be over-committed to the extent of some £35bn. He established a group of both insiders and outsiders to keep under review the progress of the defence reform agenda. He asked me to chair that group.
The resultant report was published in June 2011. I then agreed with the new defence secretary Philip Hammond that I would keep progress of reform under review and produce an annual report of my findings. The fourth such report has just been published – it concludes that good progress in all areas is still being made.
This year, I perceive a sea change in attitudes from every side. One of the principal recommendations was to delegate expenditure down the chain of command to the user. This was a brave decision by ministers and the Treasury but I think that their faith/confidence is beginning to pay off.
The perceived wisdom for many years has been that the MoD and the Armed Services are profligate in spending, averse to change and prone to revert to type after each attempt to change attitudes and behaviour. To me the MoD is now a very different animal from that which I left some 20 years ago, especially in terms of showing that they can be trusted to manage the money. The much leaner structure at the head of all three services and the colocation of those heads with their commands – at least in those services who have embraced this concept – is proving the wisdom of that change. In earlier years the approach was lacking in commercial know-how when dealing with the large procurement programme, and well removed from best practice in most other areas.
In preparing for this fourth report on the progress of defence reform in the UK, I carried out a large number of interviews right across the senior military and civilian populations. This time, however, I was struck in virtually every area by what I perceived and still perceive to be a fundamental change in thinking. The new constructs, the “holding to account”, the transfer of a substantial part of the decision making, both in overall management and in terms of commercial decisions, has now been passed down the line to those who have a determination to get it right first time.
Today I find a very palpable feeling within the MoD that: “We have learned our lessons, we don’t want to be the bad guys accused of getting it wrong year after year and this time, we are going to get it right.”
For as long as I can remember, the biggest critic of the way in which the MoD and the Armed Forces were run has been HM Treasury. But, and it is a big but, it seems to me that this year their attitude has changed. They have gone along with the delegation of authority further down the chain, and with the concurrent view that authority and, where appropriate, the money, should be scrutinised and decided upon at the next level within the system.
The impression I have is that overall attitude and behaviour has really turned the corner this time, and that does seem to be increasingly entrenched. No one likes to give away strong external control mechanisms but, by relaxing them, which appears to be now happening, better decisions can be made more quickly, more effectively and, wherever possible, more economically.
The latest review document which has now been published echoes this change in most areas. Only time will tell whether the old attitudes have finally been swept aside or whether the system will, before too long, revert to type. I hope that it will not and indeed am bringing myself to believe that it will not. Much credit must be given to senior serving officers and senior officials for being prepared to make this change and they deserve our support.
I hope that at the time of the next report, one year from now, this remarkable change of attitude will have continued and developed.
Lord Levene of Portsoken is a crossbench peer and chair of the Ministry of Defence Reform Group