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between the full costs of courses and the extra-cost
formula which is the charging basis for non-dedicated training.
11. In determining the way ahead, it will be necessary to consider both the procedures that should come into effect when the New Management Strategy has been fully implemented, and the regime that should operate over the intervening period.
12.
The Future. Under fully-fledged budgetary arrangements, it is envisaged that the single Service training managers will have agreed targets for receipts business. They will therefore have the appropriate incentive to provide capacity for F&C training, which will itself become more amenable to
central scrutiny and budgetary control. The Defence Staff will thus be in a position both to provide timely guidance to the training budget-holders on the extent of such capacity to be provided to meet defence and foreign policy objectives, and to ensure that mismatches between costs and receipts are recognized and dealt with in an appropriate manner, including the use of subsidies. (It might seem administratively preferable, and more in keeping with the spirit of the New Management Strategy, for subsidies as well as budgets to be allocated to budget holders. It is essential, however, that the DPF and DSF should continue to be managed separately in
order to ensure that overall defence interests are met).
13. The Transition.
Successive studies have confirmed that -
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for the time being at least supply and demand for F&C training are broadly in balance (except for a few prestige courses, such as RCDS and Staff Colleges, where we would not want to increase the supply even if there was the scope to do so). Provided the training establishments collectively make provision for F&C training along the lines and to roughly the scale of the last few years, this should be sufficient to bridge the transition period until the New Management Strategy becomes fully operational. It will not, therefore, be essential to identify F&C training as a separate item in the LTC. It is likely in any event that attempts to do so would be unsuccessful partly, as DUS (F)'s studies have shown, because our information about the "hidden" subsidy is
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