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Defence budget rise applies only to equipment, says Philip Hammond Defence budget rise applies only to equipment, says Downing Street
(35 minutes later)
The prime minister's commitment to above-inflation rises in the defence budget after 2015 applies only to equipment, Philip Hammond, the defence secretary has said. The defence budget, except equipment spending, will not be protected from cuts in 2015-16, Downing Street has said.
Hammond, who was clarifying remarks from senior government sources in a round of radio and television interviews on Thursday, said there would have to be a "robust discussion" about other elements of the budget. The prime minister's team rushed to clarify their position on Thursday after it was reported that Cameron was sticking by a commitment given in 2010 that defence spending would increase in real terms after 2015.
Senior sources had indicated that Cameron will honour his commitment to above-inflation rises after 2015. Tensions have been growing in the coalition as negotiations begin over how to save billions of pounds more in the 2015-16 spending review. Hammond has already seen his budget slashed by 8% in real terms since 2010. No 10 said Cameron's commitment referred only to the years after 2016-7. This leaves the defence budget open to cuts in 2015-16. A spending review for that single year is already under way in the Treasury, and the chancellor, George Osborne, who is looking for cuts, cannot afford to see the defence budget off limits.
Tory backbenchers are among those voicing fears that the long-term capabilities of the military could be degraded unless more money is found. A pre-existing commitment that the defence equipment budget will rise by 1% in real terms from 2015-16 to 2019-20 still stands.
The issue has been cast into sharper relief by the government's commitment of up to 330 personnel and air support to the campaign against rebels in Mali. Cameron's spokesman said: "The prime minister does not resile from what he said in the House of Commons at the time of the strategic defence review. He said then that his strong view is that the defence budget will require real terms year-on-year growth in the years beyond 2015. As his remarks at the time made clear 'in the years beyond 2015' means starting in 2016. To suggest otherwise would be quite wrong. As to the spending review announced by the chancellor in the 2012 autumn statement we are not going to pre-empt his decisions which will be announced in the first half of this year."
Protecting MoD budgets could mean harsher treatment for the police and other services. The statement leaves Osborne free to impose defence cuts in the spending review if he wants for 2015-16, the year after the election, so setting a lower baseline for any spending rises in the defence budget thereafter.
However, it is understood the prime minister "does not resile" from comments he made in October 2010, when he appeared to accept that defence spending had to start rising again from 2015 onwards. Philip Hammond, the defence secretary, also tried to clarify the position in a round of radio and television interviews on Thursday.
Hammond said on Thursday that he had been given a commitment that the equipment side of his budget – accounting for roughly half of MoD spending – would rise in real terms. He said he had been given a commitment that the equipment side of his budget – accounting for roughly half of MoD spending – would rise in real terms.
"I have a firm commitment that the equipment plan, which is a very large part of the defence budget, will rise in real terms by 1% a year between 2015 and 2020, that's a commitment that has previously been made and repeated since the chancellor delivered his autumn statement," he told BBC Radio 4's Today programme. "I have a firm commitment that the equipment plan, which is a very large part of the defence budget, will rise in real terms by 1% a year between 2015 and 2020. That's a commitment that has previously been made and repeated since the chancellor delivered his autumn statement," he told BBC Radio 4's Today programme.
"But there is going to be a spending review for 2015/16 and I will go into that arguing the case for the resources that defence needs to deliver the plan that we have set out, Future Force 2020, and I am very confident that we will have a robust discussion about that." "But there is going to be a spending review for 2015-16 and I will go into that arguing the case for the resources that defence needs to deliver the plan that we have set out, Future Force 2020, and I am very confident that we will have a robust discussion about that."
Pressed as to whether overall defence spending would rise or not, Hammond said: "What I know is that I have a firm commitment on the equipment plan, which about roughly half the defence budget is covered by that. That will rise in real terms after 2015."Pressed as to whether overall defence spending would rise or not, Hammond said: "What I know is that I have a firm commitment on the equipment plan, which about roughly half the defence budget is covered by that. That will rise in real terms after 2015."
Asked whether staffing budgets could be cut, he said: "The rest of the budget will be subject to a discussion around the spending review the chancellor announced in the autumn statement. But I'm going into that spending review discussion on the basis that I expect the outputs that I have defined to be protected."Asked whether staffing budgets could be cut, he said: "The rest of the budget will be subject to a discussion around the spending review the chancellor announced in the autumn statement. But I'm going into that spending review discussion on the basis that I expect the outputs that I have defined to be protected."