It’s Hammond who disarmed our Armed Forces

The MOD budget shortfall is the product of the Chancellor’s zeal for cuts while he was at the helm

There is very little Philip Hammond does not know about the parlous state of Britain’s defence budget. The three years the current Chancellor served as Defence Secretary, from 2011 to 2014, were spent overseeing the most drastic cuts to military spending in the UK for a generation or more.

It is as a direct result of the cuts Mr Hammond initiated that the Armed Forces find themselves in their present predicament, with the Army reduced to its smallest size since the era of Oliver Cromwell and the Navy unable to crew enough warships to fulfil its overseas obligations.

Moreover, the stringent belttightening undertaken by Mr Hammond and the then chancellor George Osborne helped to create the funding gaps that are now requiring the Services to make even more cuts to balance the books. Proposals are actively under consideration to reduce further the standing strength of the Army and to abandon the amphibious landing capability of the Royal Marines.

During his tenure as defence secretary, Mr Hammond said his brief was to fix the alleged £37 billion black hole in the Ministry of Defence’s finances, which was blamed on the Blair administration’s failure to fund adequately its ambitious programme of overseas military interventions.

But the zeal with which Mr Hammond set about his task meant that he went much further than just balancing the books. Such was his determination to make his mark on the Mod’s notoriously innumerate spreadsheets that, on occasion, he actually managed to underspend.

When I revealed in The Daily Telegraph in 2013 that Mr Hammond’s “over-zealous” austerity drive had resulted in a £2 billion underspend at the MOD, Mr Hammond insisted that he had secured guarantees from the Treasury that the funds would still be allocated to the military. Shortly afterwards he moved to the Foreign Office, and the money disappeared into the Treasury’s cavernous coffers, never to be seen again.

It is worth revisiting what might seem like ancient Whitehall history because it has a direct bearing on the diabolical situation in which our Services now find themselves. The cuts made during the glory days of the Coalition’s austerity drive are the reason the Navy does not have enough fuel and cooks to send its ships to sea, and Army training has been reduced to a bare minimum, to the extent that senior officers say that just 100 members of our elite Parachute Regiment are currently qualified to jump out of an aircraft.

It also explains why Tory MPS with a good working knowledge of how the military functions are in a state of high agitation, with the likes of Tobias Ellwood, Johnny Mercer and Tom Tugendhat – all of whom have military experience – lobbying hard for the Treasury to provide extra money.

Indeed, Sir Michael Fallon, who impressed senior officers with his mastery of the defence brief before his untimely resignation from the Cabinet this month, had been gearing up for a battle of wills with the Chancellor over funding.

Now Gavin Williamson, who replaced Sir Michael as Defence Secretary, seems committed to a similar course of action. In his first appearance at the Dispatch Box this week, he argued that spending 2 per cent of GDP on defence was a baseline, not a ceiling.

There are many military experts who believe even the Government’s claim to be meeting the 2 per cent Nato minimum requirement is fallacious. Thanks to Mr Osborne’s sleight of hand when fixing the current defence budget in 2015, items that were previously not included, such as pensions and the cost of replacing the Trident nuclear deterrent, must now be covered by the MOD.

Furthermore, concerns are growing that, as a result of the review being carried out by National Security Advisor Mark Sedwill, any extra funds made available by the Treasury will be used to improve Britain’s cyberwarfare capabilities rather than beefing up conventional defence requirements.

Certainly, given that the global threat environment is at its most challenging for years, the Government’s review of our defence requirements could not be more timely. And if Downing Street wants to head off a revolt by angry Tory MPS, then it needs to come up with some plausible solutions to fix the Forces’ funding crisis.

One option would be to divert money from the bloated overseas aid budget – or the ministry of blank cheques, as it is more familiarly known in Whitehall.

Another possibility – which is said to be under consideration – would be to relocate the estimated £31 billion cost of replacing Trident to the Treasury, thereby freeing up vital funds for the rest of the Armed Forces.

Whatever the outcome of the security review, what is not in doubt is that the time has come for Mr Hammond and his Tory colleagues to repair the damage they have done to our Armed Forces.