DefenceeyeProspect members in the defence industry

www.prospect.org.uk • Issue 1, May 2013

Prospect • DefenceEye – M

ay 2013

Defence is in the headlines again as debate rages in the cabinet in relation to government spending and increased pressure for further cost cutting.

none of our members working in defence, whether in the public or private sector, has been isolated from the impact of the economic crisis.

in that context there never has been a more important time to be a member of Prospect, whether in relation to personal representation at work or engagement and negotiations with employers.

Prospect also has an important role in championing the professionalism and skills of our members and the industries in which they work.

The fact that the jobs our members do help underpin the UK’s defence capability is often lost in media headlines. similarly, the industries our members work in make a fundamental contribution to the UK economy.

Through campaigning and lobbying, Prospect must put itself at the heart of the debate to champion the interests of our members and the sectors in which they work.

These are challenging times and Prospect’s Defence, Maritime and Logistics Group will be drawing up a work plan, building on the work we have already done, to ensure that members’ interests are at the forefront of everything we do.

At its heart, we have to press the government to look to the long-term future of UK defence capability,

RecRuit a membeRThe more members we have, the stronger our voice. Ask your colleagues to join us at www.prospect.org.uk/join or call 020 7902 6600 for more details.

capacity and reach. Where the government wills the

ends, it must also will the means. As part of this, Prospect has long argued for an effective and coherent defence industrial strategy to support our military capability.

We must not lose sight of the fact that the skilled jobs in the defence industry are a vital part of our advanced manufacturing base and have an important contribution to make to the economic strength of the UK both nationally and internationally.

There is a great deal that unites our members in defence. it is important that we work together locally and nationally to help shape the future for our members and the industries in which they work.

Prospect deputy general secretary Garry Graham outlines the challenges facing members in the defence industry

■■ Graham■–■skills■are■vital

Making the case for UK defence skills

We must not lose sight of the fact that skilled jobs in the defence industry are a vital part of our advanced manufacturing base

Jon

athan

EElEs

QinetiQ Pension schemeQinEtiQ’s dEcision to close its defined benefits pension scheme has been stalled by the Ministry of defence, whose approval is required as a key stakeholder in the scheme.

QinetiQ announced in october 2012 its intention to close the scheme to future accrual from January 31 2013, affecting around half of its 5,000 UK employees. it is now expected that the scheme will not close before the end of May 2013, although no formal announcement has been made.

towards the end of January it became clear that Mod had raised questions about the proposed closure, as it directly contributed towards reducing the pension deficit at the time of QinetiQ’s flotation in January 2006, and was also reviewing the pension cost assumptions in QinetiQ’s renegotiation of its partnering agreement with Mod.

Prospect says the case for closing the scheme for future accrual has been ‘over-stated’ because the consultation document asserted that the pension deficit had grown. in fact the deficit fell between the specified actuarial valuation dates of June 2008 and June 2011.

the decision to close the scheme had also not taken account of the Pensions Regulator’s announcement in January to provide more flexibility in dealing with pension deficits.

Meanwhile discussions with QinetiQ on the derecognition of unions are continuing following the acas talks last summer. Members will be consulted on the outcome.

PRosPect ResouRces■ What good change management looks like and a

checklist for reps: http://library.prospect.org.uk/id/2013/00505

■ Prospect’s response to the government’s consultation on changes to the Transfer of

Undertakings (Protection of Employment) regulations: http://library.prospect.org.uk/id/2013/00501

■ Note to members in Serco about consultation on changes to Serco Pension and Life

Assurance Scheme: http://library.prospect.org.uk/id/2013/00410

■ Serco pension consultation: http://library.prospect.org.uk/id/2013/00409

■ Letter to Steve Webb MP re AEAT Pension Scheme meeting March 2013: http://library.prospect.org.uk/

id/2013/00379

£650m of funding from 2011-12 to 2014-15 to a cross-government cyber security programme. Government also funds cyber security through the single intelligence Vote and in departments to secure their information, networks and systems.

However, the nAO says the departmental spending is “highly disaggregated” and the cabinet Office does not have full insight into the total level of expenditure.

A defence select committee report on cyber security published in January – and whose evidence the nAO drew on – warned: “The cyber threat is, like some other emerging threats, one which has the capacity to evolve with almost unimaginable speed and with serious consequences

for the nation’s security. “The government needs to put

in place – as it has not yet done – mechanisms, people, education, skills, thinking and policies which take into account both the opportunities and the vulnerabilities which cyber presents. it is time the government approached this subject with vigour.”

The select committee called on the Ministry of Defence to make the development of rules of engagement for cyber operations an urgent priority and ensure that the necessary intelligence, planning and co-ordination functions are properly resourced.

it said the national cyber security programme required robust governance and noted that the progamme’s board is chaired by the Minister for the cabinet Office. But it said the programme “represents only the tip of the iceberg of the necessary cyber security activity across government. High-profile and authoritative leadership is required for all such activity.”

■ The defence select committee report is at: www.publications.parliament.uk/pa/cm201213/cmselect/cmdfence/106/10602.htm

■ The nAO report is at: www.nao.org.uk/report/the-uk-cyber-security-strategy-landscape-review/

Cyber threat needs urgent attention, reports warnTHe nUMBer of iT and cyber security professionals has not increased in line with the growth of the internet, the national Audit Office has warned.

An nAO report into the UK cyber security landscape interviewed education officials who said it could take “up to 20 years to address the skills gap at all levels of education.”

The report, published in february, says that in 2010 the government ranked cyber attacks as one of top four UK national risks.

The 2010 comprehensive spending review committed an additional

Prospect • DefenceEye – M

ay 2013

2 Round uP

unceRtain futuRe foR naval shiPbuildingthE fUtURE of shipbuilding in Portsmouth remains uncertain. BaE systems is reviewing its operations but any decision on shipyard closures is unlikely to be made before the referendum on scottish independence in autumn 2014.

the company has not officially confirmed media reports that BaE systems would prefer to consolidate its shipbuilding operation in scotland, where it has two yards on the clyde.

the outcome of the scottish referendum has a bearing because the UK government has said it will not build complex warships outside the UK.

Prospect members in Portsmouth have been guaranteed work up until 2014 because of the second aircraft carrier, but there

is still great uncertainty as to the future of shipbuilding post-2014. this is exacerbated by the fact that there can be no decision on where to place the next warship contract, the type-26, until the independence question is resolved.

Prospect’s BaE surface ships branch has more than 280 members working in shipbuilding, naval and fleet support and systems.

the union recently concluded pay negotiations with the two BaE systems businesses operating within Portsmouth naval Base.

Members in both BaE systems Maritime services and BaE systems naval ships voted overwhelmingly in favour of a 3 per cent pay increase from april 2013.

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Prospect • DefenceEye – M

ay 20133Round uP

Defence spending on iceTHe UK defence industrial base has been in decline since the strategic Defence and security review in 2010. early signs are that the forthcoming government spending review is unlikely to reverse this trend.

in february the government announced its planned equipment programme for the next 10 years, including:

● £60bn for new military equipment ● £68bn to support equipment

currently in service ● £18bn to support new

equipment ● £18.4bn retained for

‘unallocated’ funding headroom ● £4.8bn contingency for

unexpected programme growth.However these spending

plans have done little to allay fears that defence spending will be subject to a further period of retrenchment.

An assessment of the government’s plans by the national Audit Office found that the cost-growth projections of MOD’s procurement plans understated the costs by £12.5bn (15.7 per cent).

significantly, the nAO excluded equipment support costs from their analysis, which make up 54 per cent of projected spending.

This scepticism has been reinforced by the nAO’s latest Major Projects Report which found that costs of the 16 largest contracts had risen by 11.7 per cent and the time slippage against original planned project length had risen to nearly 30 per cent.

The government has already announced a further one per cent squeeze on its core budget below planned levels in the next two years; a cut of £249m in 2013-14 and £247m in 2014-15.

for industry, the certainty that has been provided by the announcement of the

facts at your fingertipsThe house of Commons library produces useful briefings on a range of topics. The most recent additions are listed below.

■ DEfENcE ESTATE rATioNALiSATioN provides

a summary of the main changes to the defence estate that have been announced since the Army Basing Review was published in March 2013. Further decisions on aspects of the defence estate, including the training estate and the reserves estate are expected to be made over the course of 2013 – www.parliament.uk/briefing-papers/SN06607

■ ThE ArMy BASiNG rEviEW, announced in March 2013,

is based on the new Army 2020 plan outlined in July 2012. Two key principles guided the review: that the armoured infantry brigades should be centred round a single location, and the Army should retain a uK-wide presence. The Basing Review envisages an Army increasingly consolidated around seven centres in the uK with the closure of a number of bases, a faster withdrawal from Germany and an end to the culture of routine rotation in the uK – www.parliament.uk/briefing-papers/SN06598

■ ThE f-35 JoiNT STrikE fiGhTEr will be the new

multirole fast jet for the Royal Navy and Royal Air Force. It will serve as the strike capability for the new Queen elizabeth Aircraft Carrier and will partner the Typhoon to form the future fast jet fleet for the RAF. It is a multinational acquisition programme led by the united states in partnership with eight other nations, including the uK – www.parliament.uk/briefing-papers/SN06278

toWaRds the neXt defence and secuRitY RevieWthE hoUsE of commons defence select committee says its priority is to help to shape the next strategic defence and security review. so why did it give those who might have contributed so little time to do so?

the committee announced an

inquiry called ‘towards the next defence and security Review’ on March 22. But the closing date for contributions was april 12 – with a two week Easter break in between.

the inquiry will look at: ● the strategic balance between

deterrence, containment, interven-tion and influence

● the utility of force ● the legitimacy of force,

including the political/military interface, and the changing legal environment

● lessons learned from current and recent operations

● the relationship between hard and soft power in terms of influence.

■■ http://bit.ly/defence_select_committee

government’s priorities over the next 10 years has been offset by the likelihood that new projects are less likely.

General Dynamics’ recent announcement that it intends to cut more than 10 per cent of its UK workforce and restructure its business is the

latest sign of Britain’s shrinking defence industry.

Uncertainty continues to dog BAe systems following its failed merger with eADs last autumn. Although benefiting from a number of projects on the MOD planned equipment list, there appears to be limited prospects for growth in new areas when contracts come to an end.

The problems for BAe systems are further exacerbated by retrenchment in the Us defence

budget, which is also affecting QinetiQ’s Us businesses.

As a result of sequestration – funding caps imposed by congress in the 2011 Budget control Act – contractors are reviewing investment decisions in new product development.

With the export market in the developed economies shrinking and countries such as south Korea and india entering some sectors of the expanding Asian defence market, defence contractors will struggle to find new orders in the medium term in the absence of new commitments from the UK government.

The prime minister placated the defence industry in 2010 with a promise of real terms spending increases in the next parliament. But rather than easing the pain, commitments to future equipment spending are likely to be accompanied by further spending cuts.

General Dynamics’ recent announcement that it intends to cut more than 10 per cent of its UK workforce and restructure its business is the latest sign of Britain’s shrinking defence industry

Prospect • DefenceEye – M

ay 2013

4 civilians

intake and outfloW of civilian PeRsonnelthE oUtflow of civilian personnel in core Mod increased from 4,470 to 9,420 between 2010-11 and 2011-12, of which 5,950 were personnel leaving under the voluntary early release scheme, as part of the strategic defence and security Review reductions.

consequently, core Mod outflow rates increased from 6.9 per cent in 2010-11 to 16 per cent

in 2011-12, the highest in the last seven years.

the intake rate was stable at between 6.5 and 6.8 per cent of average strength, with an intake of over 5,000 personnel each year from 2006-07 to 2009-10. But the intake rate fell to 2.7 per cent in 2010-11 and even further to 2 per cent in 2011-12, reflecting an intake of only 1,380 in that year.

armed forces and civilian strengthWhIle The uK Armed Forces have reduced in size by 12.5 per cent since 2000, the MoD civilian population reduced by 41.5 per cent over the same period.

Between 2000 and 2010, the strength of the uK Armed Forces fell from around 212,700 to 198,200, representing an overall decrease of 6.8 per cent.

over the same period, the MoD civilian (level 0) total fell from around 121,300 to around 85,800 – a 29.3 per cent decrease over the period.

As at April 1 2000, civilians accounted for 36.3 per cent of total personnel; by 2012 this had fallen to 27.6 per cent of total personnel.

Personnel reductions under the sDsR are set to continue until 2020 from the baseline start point of April 2010.

strength of uK Regular Forces by rank, at 1 April each yearofficers by rank 2000 2012Major Gen. & above 150 140Brigadier 370 330 Colonel 1,100 1,140lieutenant Colonel 3,910 3,920 Major 9,940 9,050Captain 11,800 12,030lieutenant & below 5,240 4,090other ranks 175,100 149,100

THe MinisTry of Defence has admitted that it is concerned about its ability to manage defence reform given its need to make 32,000 civil servants redundant.

Jon Thompson, permanent under secretary to MOD, was questioned by the House of commons defence committee on the department’s annual report and accounts for 2012.

He told the MPs: “We have reduced the number of civilians by over 20 per cent in the past two years and our plan over the next 10 years is to reduce that number of civilians by 35 per cent. We have reached the point where i think you do have to ponder whether you can fully drive towards 35 per cent or not.”

The committee said: “We are concerned that the output of MOD and the reforms needed within MOD are at risk because of the reductions in staff numbers required to meet the budget cuts.”

Finance skills shortageThe committee also criticised MOD for being five months late in submitting its audited accounts to Parliament.

committee chair James Arbuthnot said: “The delays in producing the Annual report reveal a worrying lack of financial expertise within MOD. The MOD must ensure its people have the right skills to deal with all financial problems so that they do not need to bring in expensive external accountants.”

Jon Thompson said the financial challenge in MOD was complex and that implementing the strategic Defence and security review had “added further layers of complexity to the

MOD reaches tipping point on civilian job cuts

financial challenge”.He acknowledged that MOD did not have

the necessary expertise and had had to bring in external assistance from some of the large accountancy firms. When asked to quantify the level of skills that MOD needed, Thompson said MOD had approximately 1,000 qualified accountants and around 100 KPMG colleagues.

But he did say that number would reduce over time and estimated that the department would have the necessary in-house expertise by 2014.

The committee called on MOD, in its response to the report, to set out its plans to ensure that it gets the expected transfer of skills to internal MOD staff from its employment of external accountancy staff.

The report also said it was vital that defence spending remains at more than two per cent of GDP in line with the UK’s nATO commitment.

Permanent secretary questions Mod’s ability to achieve civilian cuts without damaging defence

Intake and outflow of civilian personnel as a percentage in postYear 2005-06 2010-11 2011-12Total intake 6.8 2.7 2.0MoD excluding trading funds 6.9 2.5 1.5Trading funds 6.0 4.4 6.1Total outflow 11.0 7.1 18.2MoD excluding trading funds 10.7 6.9 15.8Trading funds 13.1 8.1 34.5Rates■are■the■number■of■people■who■join■or■leave■the■department■per■100■of■the■average■headcount■strength■in■each■category,■but■exclude■the■effect■of■net■transfers■between■MOD■Main■TLB■and■Trading■Funds.

Notes: The following changes have affected the continuity of the civilian data: At 1 April 2008 the Defence Aviation Repair Agency and the Army Base Repair Organisation merged to form the Defence Support Group and around 1,000 personnel transferred to the Vector Aerospace Corporation. In October 2011 responsibility for management of the Meteorological Office personnel (1,900) transferred to Department for Business, Innovation and Skills.

Prospect • DefenceEye – M

ay 20135PRivatisation

act as an intelligent customer.”Prospect recommended two

changes to the government’s approach to defence acquisition:

● first, if government is to act as an intelligent customer it must take urgent steps to halt the haemorrhage of staff from the civilian workforce. This means reviewing the cuts programme and addressing the collapse in morale since the sDsr in 2010 announced that one third of staff would be made redundant.

● second, the government needs to take steps to safeguard the defence

industrial base by adopting an active industrial policy that promotes high value, high skill manufacturing jobs.

The union said it was likely that MOD will re-hire many ex-employees as highly paid consultants to perform the functions they recently held as a MOD government specialists. The loss of corporate knowledge, particularly among the age group 40 to 50, will take years to recover from, if ever.

“MOD faces the prospect of a serious accident or a major mistake in the provision of support to frontline service personnel. This will be the direct result of the rapid and unplanned loss of experienced and skilled staff from MOD. This is an urgent and serious problem that MOD must address before further cuts in civilian staff are made.”

Prospect believes that the environment being generated by the sDsr, Defence Transformation and the Materiel strategy is mirroring that created by the change programme which led to the nimrod disaster and increasing the likelihood of another serious accident.

■■ http://bit.ly/prospect_evidence

Defence Equipment and Support threat

Plans to privatise the defence Equipment and support organisation will increase the likelihood of another serious accident like the nimrod disaster, says Steve Jary, national secretary

THe GOVernMenT’s plans to privatise the organisation which buys and supports equipment and services for the armed forces moved a step closer in April.

The Defence equipment and support organisation has a £14bn annual budget and employs approximately 16,500 people – one third of them are military officers – around the UK and overseas.

Defence secretary Philip Hammond announced in a written statement that a 12-month ‘assessment phase’ will compare two options: a public-sector comparator “De&s+” and a government owned, contractor operated arrangement.

Prospect highlighted the risks in this approach in its evidence to the House of commons defence select committee inquiry into defence acquisition. The union said MOD’s “lack of acknowledgement that improvements have been, and continue to be made, at programme and project level is driving the development of a Materiel strategy, which has the clear and sole aim of transferring the MOD’s entire intelligent customer cadre, and giving control of some £20bn of defence expenditure, to the private sector.”

That, coupled with the drive to cut De&s staff by 28 per cent before the strategy is even implemented, is undermining the ability of De&s to retain the MOD’s intelligent customer role for defence procurement and support.

Prospect pointed out that since the publication of the strategic Defence and security review and the national security strategy, the government appears to be trying to undo improvements in MOD’s approach to defence acquisition.

The union said that the prolonged period of paralysis since the Defence industrial strategy was last reviewed, along with the launching of an unplanned and poorly managed reduction of the civilian workforce, “has resulted in a catastrophic loss of key personnel from the department, which undermines commitments to

SElECt COMMittEE

❝it is clear that a goco is not universally accepted as the best way forward, and that there are particular

concerns about how the Mod’s overall responsibility for acquisition could be maintained within a goco.

in particular, we believe problems might arise if a non-UK company were given responsibility for UK defence acquisition. we further believe it is vital that consultations are satisfactorily concluded with allies, to ensure that there is no adverse impact on co-operation, before any proposals are implemented.”

House■of■Commons,■defence■select■committee

RUSi

❝thE goco proposal suffers from an inherent weakness,

since it appears to rest on an argu-ment that, because the government is not very good at negotiating and managing contracts with the private sector, it is going to negotiate an even bigger contract with a private sector entity to undertake the entire task on its behalf.

the bottom line is that, as practitioners and observers of defence acquisition in the UK and elsewhere, at present we cannot easily see how the dE&s as a goco would even work in practice, let alone why it would be a less expensive and better alternative to what is in place today.”

Royal■United■Services■Institute

■■ Jary■–■major■concerns

■■ Philip■Hammond■addressing■the■Conservative■party■annual■conference■2012,■Birmingham

PaUl g

RovER/REx fEatU

REs

UniOn Officers from Prospect, Unite and the GMB met former defence secretary Lord Browne in April following a recent Daily Telegraph article in which he argued that nuclear deterrence is “decreasingly effective”.

Lord Browne is chair of the cross-party Trident commission set up by the British American security review council. He explained why he had changed his mind since supporting the successor programme in 2006.

He argued that the world had changed since 2008 and the global economic crisis had fundamentally changed the economics of western nations. economic growth was no longer guaranteed and we had to face the fact that defence budgets would be cut for the foreseeable future.

This, the end of the cold War and the lack of any existential threat of a nuclear attack meant that replacing Trident with a like-for-like, continuous at-sea deterrent (cAsD) was open to question.

Prospect and the other unions mounted a strong argument based on irreplaceable workforce skills and the economic need for highly-skilled defence jobs.

They pointed out that Labour leader ed Miliband had already said that a Labour government would not unilaterally disarm. The argument is not about whether to build the next generation of nuclear submarines because there is no other effective means of delivering nuclear weapons.

The unions said the need to replace the Vanguard submarines should not be in question. Lord Browne said he was not opposed to building more submarines, (though he didn’t say he supported further new-build either) but an open debate was needed about whether continuous at sea deterrence and Trident were the right way forward.

Lord Browne said it was important that the UK did not

Prospect negotiator Tony hammond reports back from a recent meeting with former defence secretary, lord des Browne

have cheap nuclear weapons as this would give emerging nations the aspiration to have them.

He also argued that the experts who told him that it was critical to replace the Trident missile system before 2010 were the same ones who now said the missile could last another 40 years. He therefore did not necessarily believe experts who said that the Vanguard boats were reaching the end of their lives and needed to be replaced.

it is clear that the unions will now need to consider how to address his arguments.

The first step will be to prove that the Vanguard boats are near the end of their lives and need replacing. Lord Browne believes the only evidence for this is coming from the submarine industry, which has a vested interest in building new subs.

secondly, it is also clear that a strategy is required which separates the need for silent boats (nuclear submarines) from the argument around which type of weapon will be a requirement on any new boats.

The Trident decision affects: ● the future of the shipyard in Barrow-in-furness, where

BAe systems already employs 1,000 people on designing the replacement for the ageing Vanguard submarines and would employ 6,000 by 2017 if there was a full upgrade

● a further 7,000 jobs in the supply chain which would be at risk, including at rolls royce at Derby; sheffield forgemasters; the faslane naval base on the river clyde, where the submarines are based, and Devonport Dockyard in Plymouth, where they are maintained.

● AWe, which develops and builds Trident warheads.

The cabinet Office is leading a Trident Alternatives review, which will report to the prime minister and deputy prime minister in the first half of 2013. The decision on whether or not to replace Trident is due in 2016.

■■ http://bit.ly/DTtrident■&■http://bit.ly/BASICtrident

Unions make trident case

■■ Hammond■–■■■workforce■skills■irreplaceable■and■■economic■need■for■highly-skilled■defence■jobs

aP/EMPics

Prospect • DefenceEye – M

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6 tRident

Prospect • DefenceEye – M

ay 20137scotland

in a report released in early april, the committee said the defence industry provides more than 15,000 jobs and contributes between £1.8-£2bn annually to the scottish economy.

it said if scotland were to separate from the UK in the upcoming referendum, the impact on the scottish defence industry would be substantial and negative.

The committee was unable to identify any defence supplier or product that would benefit from separation, but did find a large number that would suffer.

The UK research budget is £400m. estimates of a future research and development budget for scotland vary between £20m and £30m.

A scottish defence budget of £2.5bn would represent 6.5 per cent of the UK defence budget. A procurement budget of £1bn would represent about 6 per cent of the UK defence procurement budget. This is before costs associated with intelligence and a transition period are taken into account.

The Ministry of Defence has said the costs of having to sever contracts as a result of separation would be factored into any separation negotiations.

The committee said separation would impact negatively on the defence industry in scotland in six key ways:

● The market offered to defence suppliers in a separate scotland

would be negligible in size compared to that of the UK as a whole, and the joint projects in which it participates eg Typhoon.

● Those firms or subsidiaries dependent on British Army, rAf or royal navy orders will lose all UK exclusive work, which will be transferred to sites still in the UK.

● A separate scotland – especially one which has expelled the royal navy’s submarine force and imposed unilateral nuclear disarmament on the UK – will not be seen as a reliable ally or partner, by nATO or others, for collaboration in those large international projects which are the main routes to market for many scottish defence products.

● A separate scotland’s access to secret technology owned elsewhere is unlikely to be automatic. even if access for Us and other nuclear forces to scottish sea, land and air is allowed on a “don’t ask, don’t tell” basis, which is undecided, there will not

necessarily be the maximum security clearance necessary to allow export to, or collaboration with, Us or other suppliers or purchasers.

● A separate scotland is unlikely to be able to fund the level of research and development necessary to maintain scottish companies at the cutting edge of technology, so they will soon degenerate to commodity suppliers which will face international competition.

● The defence industry in scotland is designed to meet the needs of its main customer – the UK Ministry of Defence. Defence procurement in a separate scotland would have a much smaller budget and need very different equipment.

The committee said it was es-sential that the scottish government spells out, as quickly as possible, its intentions for procurement and research budgets, and foreign and defence policies, after separation, should the referendum produce a vote for independence.

Prospect’s scotland committee has set up a defence working group to inform members of the potential impact of independence and no independence before the referendum in september 2014. The working group is made up of lay activists from defence and related branches.

■■ http://bit.ly/SACreferendum

Referendum will put 15,000+ Scottish jobs in the firing linethousands of people whose jobs depend on the defence industry in scotland need to be told, before the referendum, what their real prospects for future employment would be in a separate scotland, says the house of commons scottish affairs committee

The defence industry in Scotland is designed to meet the needs of its main customer – the UK Ministry of Defence. Defence procurement in a separate Scotland would have a much smaller budget and need very different equipment

REx fEatUREs

funding of research, postgraduate training, facilities and infrastructure

● work together to demonstrate the impact and value of the science and technology they have invested in

● share best practice for joint working and harmonise procedures between DsTL and research councils.

■■ Statistics■on■R&D■expenditure■provide■an■important■guide■to■the■levels■of■investment■in■the■economy,■provide■a■key■indicator■of■future■growth■and■com-petitiveness,■and■allow■for■international■comparisons■to■be■undertaken.■MOD■accounts■for■around■40■per■cent■of■the■UK■government’s■spending■on■R&D.

reseArcH cOUnciLs UK and the Defence science and Technology Laboratory have signed a collaboration agreement that will ensure they continue to work together in priority areas to maximise the benefits delivered by public investment in research, innovation and technology.

The charter, which will initially last for three years, was signed in January at the Ministry of Defence in London.

The charter sets out the guiding principles of how closer working between the research councils and DsTL at senior and operational levels should be conducted. Through the charter the organisations aim to:

● better understand each other’s strategies, plans and drivers

● identify synergies and create opportunities for future joint

❝thE EQUiPMEnt of today is the fruit of

spending on science and technology and research and development in the past, and without continued investment, the UK defence manufacturing base will degrade.

it is important that spending by the Mod on defence science

and technology is increased. the reduction in this spending in recent years (even though it has now been halted), together with the emphasis on off-the-shelf procurement and open competition, offers a serious threat to the technical skills base, specifically though not exclusively to the defence

skills base, within the United Kingdom. this in turn threatens the defence body of knowledge and may come to threaten the UK’s ability to defend itself.”

■■ Paragraphs■107■and■111,■Commons■defence■select■committee■report■on■defence■acquisition■–■http://bit.ly/defenceacquisition

PloughsharehIsToRICAllY, DeFeNCe research has produced many advances including supersonic air travel, liquid crystal displays and infrared detectors.

In line with government policy of realising the economic benefits of public sector research, Ploughshare Innovations was established to bring publicly available technological achievements to market. Ploughshare manages the commercial licensing to industry of intellectual property developed by the Defence science and Technology laboratory. www.ploughshareinnovations.com

2000-2001 2000-2001 2006-2007 2010-20112006-2007

three-year charter to maximise investment

■ Note: On 1 July 2001 DERA was split into two organisations: the Defence Science & Technology Laboratory (about a quarter of DERA) staying as a Trading Fund within MOD, and QinetiQ, the remainder, becoming a private (extramural) company.

Published by Prospect, new Prospect house,

8 leake street, london sE1 7nn

defenceEye editor: Marie Mcgrath

E marie.mcgrath@prospect.org.uk t 020 7902 6615

Printed by: college hill Press

Prospect • DefenceEye – M

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8 R&d

212

485

412400

532

1,117

182

1,366

1,143

63

179 163

2010-2011

MOD total gross R&D expenditure (£m)

These tables detail the Ministry of Defence’s annual expenditure on research and development activity. Expenditure is broken down into activity undertaken within the department and outside of the department.

Research Development

■■ Inside■the■department■■Outside■the■department