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Defence budget has £37bn black hole

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The full scale of the cuts facing the military in Scotland became apparent when UK defence secretary Liam Fox described a £37 billion black hole in the Ministry of Defence budget.

In a speech in London on Friday, Mr Fox said “root and branch” reform of the MoD is required and this could result in a cut in the number of senior military officers.

Although he did not specify where any cuts will be made, campaigners who opposed the merger of Scotland’s regiments believe the cuts could have a devastating effect north of the border and fear the name of The Black Watch may even be wiped out in order to save money.

All branches of the military are preparing themselves for hefty cuts once a strategic defence and security review (SDSR) is published in October.

Dr Fox said the MoD will be restructured and that the spending review will need to “put the Cold War to bed” and refocus the armed forces to cope with future threats to the UK, rather than historical enemies.

However, although he ruled out merging the main services, he maintained the armed forces must become more efficient.

He said, “We need to challenge some of the fundamental assumptions which drive force generation, such as tour lengths and intervals, taking into account the varying pressures on our personnel resulting from widely varying missions to see if we can update our practices and produce greater efficiency while implementing the military covenant.

“We need to review all our current practices to ensure that we are using our greatest asset our people to the best of our ability.”

“We will also consider whether the current senior rank structure across the services is appropriate for the post-SDSR world.

“We cannot demand efficiency from the lower ranks while exempting those at the top.”‘Unfunded liability’Dr Fox said the MoD had an “unfunded liability” of £37 billion over the next 10 years.

He set out plans to reorganise the department into three branches policy and strategy, the armed forces, and procurement and estates and revealed a defence reform unit is to be set up under Lord Levene to guide the “hard thinking” and complement the ongoing strategic defence and security review.

But he refused to say how many MoD civil servants would lose their jobs.

“I’m not beginning from that premise. I’m beginning from the premise that we set out the structures we will need in the long term, and then we will make the changes we require to get there,” he said.

“It will not mean equal changes across the system. Some parts of the organisation I think work better than others, I think some parts of the armed forces work better than others.

“This needs to be the defence review that puts the Cold War to bed. This needs to be the defence review that changes the way Britain looks at the world around it.

“What this is about is shaping Britain for the 21st century, and that is the big cultural shift which I think underpins every bit of thinking of the review that we’re undertaking.”Axe loomsThe Royal Navy, army and RAF are set to see personnel numbers reduced and equipment projects axed as a result of the review.

It has been suggested the army could lose one of its brigades in Germany, the navy could see one of two new aircraft carriers cancelled, the Royal Marines could be brought under the army’s control and the RAF could shrink to its smallest size since the first world war.

Jeff Duncan, who led the campaign against merging Scotland’s historical regiments, warned against any drastic changes to the make-up of the armed forces in Scotland

“From what I’ve heard, this was not so much a statement as a warning shot across the bows,” he said.

“There is real speculation that The Black Watch will get merged with another battalion and who knows what that will be called?”

Mr Duncan added that Scottish Tories who fought against the merging of Scotland’s regiments would suffer in next year’s Scottish Parliament elections if they support any cuts to the armed forces in Scotland.

“Of course, they will argue it is because of Labour’s finances but I and many other would say they should keep the regiments, keep RM Condor and RAF Leuchars and scrap Trident instead,” he said.

The results of the SDSR will be announced at the end of October.

It is examining all areas of MoD spending except Trident.