VEERJPOK EYES A
5.
This then is the background against which we conducted our Defence Review in 1974
and are now again having to re-examine our Defence programme. I do not want to
go into details of the Defence Review. It is sufficient to say that the situation
was such that only a searching and fundamental review of all our defence commitments
against the background of the economic resources available, would provide the basis
geared of a future defence policy/to our essential defence requirements and our ability
to meet them. The review was set in hand at once and proceeded from a careful
appraisal of the strategic priorities and the implications - military, political,
economic, industrial and led to conclusions for the future allocation of defence
rescurces. In strategic terms the conclusion could only be that NATO - the area
of prime importance to British and European Security must be our first end over-
riding charge on defence resources though even here significant economies were
necessary; and that our commitments outside the NATO Alliance must be reduced
as far as was possible. It is not necesssary to rehearse in detail the various
measures of reduction and withdrawal on which the Government decided and which
were subsequently announced to Parliament and public. We announced our intention
to reduce defence expenditure as a proportion of GNP by about 1% to 42% over the
next 10 years. In money terms this meant that substantial savings measured
against the 5.8% then current would be made, rising from £300 million in 1975/76
to about £500 million a year by 1978/79, and to some £750 million a year by
1983/84; and a total saving of £4700 million over the period.
6.
I must emphasise that in military terms these were painful steps to take; and that
our NATO allies, while sympathetic to our economic difficulties, felt and expressed
considerable concern at the scale of reduction we proposed and their effect on
NATO's political and military capabilities. I want to make this very clear; that.
even our first line of defence of the UK, our military contribution to NATO, could
not be exempted from cuts and that our economic situation was such as to necessitate
SEORETUK EYES A