The Problem at the Heart of UK Defense

Earlier this year, the United Kingdom released its integrated defense review, a document laying out London’s military goals and modernization efforts for the future. But achieving the goals in that document will require the acquisition system to match policy decisions — something Justin Bronk of the Royal United Services Institute think tank warns is a long-standing challenge.

There is a chronic problem at the heart of the UK defense establishment, one that is the root cause of many procurement disasters, force design inconsistencies, and the fact that the country gets significantly less value from its defense spending than many of its allies and competitors. Put simply: political ambitions for capability and a global British role as a military power completely outstrip the funding made available for the Ministry of Defence.

Most, though by no means all, of the bad behaviors in procurement and program management within MoD and the Defence Equipment & Support Agency (DE&S) stem from this high-level mismatch between policy ambition and funding, one that forces defense planners to continually come up with new and often convoluted arrangements to theoretically render the various capabilities needed to meet policy requirements affordable.

Often this simply entails delaying badly needed upgrades or modernization programs because the cash cannot be found in each given year. Aggressive targets for efficiency savings for the services, as a means to free up extra cash for modernization, did initially create budget headroom and help reduce waste. However, once the more egregious examples of actual inefficiency had been eliminated, further large-scale savings quickly became difficult to find. With major equipment programs only affordable through continued “efficiency savings,” the hollowing out of important enabling and support capabilities, and the reduction of spares and munitions stockpiles has become commonplace — hardly efficient in real terms.

Creating armed forces fit and capable for serious combat operations is an inherently inefficient activity by peacetime standards. “Right sizing” a force structure and enablers for peacetime assumptions on attrition, deployment tempo, ammunition consumption and spares requirements creates brittle capabilities which could quickly lose effectiveness if tested in serious conflict.

The implications of the funding/ambition mismatch are not confined to the armed forces themselves. The services’ desire to buy equipment and munitions from the US, to leverage cheaper unit costs and the latter’s massive R&D spending, is counterbalanced by national economic and political requirements to support domestic industry. However, small stockpiles of complex weapons and a force structure with an ever-smaller number of platforms also ensure that the domestic (and broader European) industrial base is generally optimized for low production rates, with long lead times.

This, in turn, means that the ability to rapidly surge domestic production of munitions and spares in a crisis is extremely limited. The real-world consequence for the British military is a near total dependence on the US for rapid resupply and logistics in conflict against a serious state adversary — a policy outcome made riskier by the fact that most other European NATO members share the same dependency.

The RAF E-3D Sentry AWACS saga illustrates many of these processes in action.

During the late 2000s, as the US and French air forces began mid-life upgrade (MLU) programs needed to maintain their E-3 fleets to the intended out-of-service date in 2035, the RAF considered its options and took another path. With operations in Afghanistan and Iraq in full swing, and a wide range of upgrade programs and urgent operation requirement acquisitions underway to support those missions, the RAF quietly decided to indefinitely postpone the E-3D MLU to help balance the books — a move which attracted little political scrutiny at the time.

By 2017, the repercussions of these cost savings were becoming clear, as the RAF E-3D fleet was increasingly beset by mechanical issues, mission system obsolescence and even flight safety concerns. £2 billion was allocated to a belated life extension program aimed at keeping a reduced E-3D fleet viable until 2035, when it could be replaced in cooperation with the US and France with whatever was chosen to replace their modernized E-3G and E-3F fleets. However, technology and the threat picture had significantly moved on from that which had informed the US and French upgrade programs. This made the £2 billion price tag difficult to justify in light of the limited capability offered in return for fixing the many problems generated by a decade of under-investment in the E-3D fleet.

Consequently, the RAF ordered five of the more modern E-7 Wedgetails as a replacement for the E-3D in the AWACS role in 2019. To pay for this, the E-3D was slated for rapid retirement from service in 2021, and the £2 billion previously allocated to the life extension program shifted to fund the E-7 acquisition. As so often happens within British defense, however, it soon became clear that the RAF had been over-optimistic in their calculations for the E-7 acquisition and all the associated set up costs.

There are many differences in opinion as to why and how the discrepancy arose, but it is certainly the case that the RAF, the broader MoD and then-Secretary of State for Defence Gavin Williamson all faced strong incentives to find a way to make the numbers add up on paper at the time the E-7 deal was signed. The AWACS mission is one of the UK’s core commitments to NATO, and the state of the E-3D fleet by 2019 was a source of significant potential embarrassment at both the operational and political level.

Nevertheless, the 2021 Integrated Review and accompanying Defence Command Paper process prompted a hard review of the E-7 cost figures against all the other modernization and sustainment costs facing the RAF and other services. In common with many other major programs, costs did not match the budget available or the figures initially agreed, and the result was that the RAF was told, once again, that budget constraints had to trump capability. Significant efficiencies were found by moving the E-7 fleet from RAF Waddington, where most of the ISTAR fleet is based, to RAF Lossiemouth to take advantage of support and infrastructure commonality with the P-8A Poseidon MPA fleet there. The RAF hoped that this would allow the program to continue with four out of the five original E-7 airframes still being acquired. However, the political side of the review process determined that only three airframes could be procured.

This outcome is symptomatic of the malaise afflicting so much of UK defense, so let’s review. As a result of the budget being insufficient to meet the requirements of sustainment, operations and modernization, upgrades for the E-3D in the late 2000s were scrapped. A decade later, the E-3D was out of step with the versions operated by partner air forces, increasingly expensive to operate, with poor serviceability and obsolescent mission systems. The effort to acquire a replacement at short notice has rapidly fallen prey to the same combination of over-optimistic cost estimates to try and maintain a politically sensitive capability without additional funding, leading to further cuts.

The result: the RAF will still pay nearly £2 billion, but will receive only three E-7s to replace the six remaining E-3Ds. Despite the E-7 radar and mission systems being far more capable and flexible than the E-3D that it is replacing, three aircraft are not enough in the medium term to guarantee one on station as required. The iron laws of maintenance, serviceability and crew rotations place hard limits on the ability to endlessly do more with less in the air domain.

The cycle of deferred or cancelled upgrades leading to reduced availability, rapid obsolescence and the need for urgent modernization is endemic in British defense. As programs are delayed to balance the books in-year, the modernization bill increases and the gap between political rhetoric and reality widens. Acquisition programs are then penny-pinched, micro-managed and often spread over a decade or more to try and make the books balance — an almost perfect mix to ensure maximum long-term cost and risk for minimal capability. British defense planners are forced into chronic bad behaviors because the force structure required to meet policy demands simply cannot be delivered and sustained within the budget available year on year.

Until the British government engages in a more honest discussion about the need to significantly reduce defense capability ambition or significantly increase spending, program outcomes like the E-3D/E-7 are likely to remain par for the course. A re-alignment of resources and ambitions will not solve all of defense’s problems in itself, but it is an essential first step.

Justin Bronk is the research fellow for airpower and technology in the military sciences team at RUSI. He is also editor of the RUSI Defence Systems online journal.