(DEFENCE AND EXTERNAL AFFAIRS SUB-COMMITTEE)
4 February, 1974.]
35
[Continued.
2
Para. 35, line 2, delete "£260 million ", insert " £330 million ".
line 3, delete "£100 million " insert £110 million
9
,
66
Para. 37, line 5, delete" £1,550 million ", insert "£1,500 million ".
line 6, delete "£3,000 million ", insert
Para. 53, lines 4-6, delete and substitute:
66
insert" £3,200 million".
'Equipment: Savings in R and D amount to some £45 million in 1975-76, £30 million in 1976-77, £35 million in 1977-78, £45 million in 1978-79 and £55 million on average from 1979-80 to 1983-84.”
As regards the consequential alteration to para. 35, it should be explained that on pre-Defence Review plans extra-mural expenditure would have increased heavily and therefore had to take the heaviest cut in the Defence Review, leaving the extra-mural to intra-mural ratio unchanged at 2:1 at the end of the period.
Examination of Witnesses
Mr. A. P. HoCKADAY, C.B., C.M.G., Deputy Under Secretary of State (Policy and Programmes), Mr. T. CULLEN, Assistant Under Secretary of State (Operational Requirements), Mr. D. M. EVANS, Assistant Under Secretary of State (Pro- grammes and Budget), Mr. G. C. B. DODDS, Assistant Under Secretary of State (International and Industrial Policy), and Rear Admiral A. S. MORTON, Assistant Chief of the Defence Staff (Policy), Ministry of Defence, called in and examined.
Chairman.
Mr.
34. Good afternoon, gentlemen. Hockaday, we know each other well. One or two of you we have not met before? (Mr. Hockaday.) We are all five of us members of the central staffs of the Ministry and we certainly hope to be able to do everything that we can to help you on the general structure, general outline and general policy of the review. It may be that some ques- tions that you wish to pursue will be questions in some cases perhaps more for a single service than for us, in which case it might be better that we could undertake to have the right experts along next week or something like that.
35. That is very kind. I was going to suggest the same thing. We are very grateful to you for your very helpful paper on the defence review. As this is quite a long document and the subject is complicated, we shall be meeting again next week, as you say, and if we cannot finish it next week we have set aside some time on the 18th. We shall deal with the paper generally by following the eight separate sections and today we will aim to cover the first four sections which run up to paragraph 31. We can probably go through the first seven paragraphs fairly quickly. I think you know we had Mr. Greenwood to give a lecture on this
which, of course, was in no way secret. It was quite an interesting experience for the Sub-Committee. Is it not the case that the comparison given in paragraph 2 is misleading since really we are not comparing like and like? That is the comparison between the different countries, if you compared the effective fighting strength of our forces with those of, say, France and Germany?- -When you suggest, Sir, that we are not com- paring like with like, I am not quite sure that I take precisely the point that you are making. The figures shown for the countries are like with like in that each represents a proportion, the pro- portion that defence expenditure in terms of national currency bears to the gross national product of the country in factor cost terms, also in national currency. There is no attempt to adjust into a common currency as is done in some other measures of defence expenditure.
If
36. It is rather academic as to which way you should do the calculations. The Government have done it on GNP. you have a number of conscripts paid a very small amount, the proportion of the money you take for the men you have is a descending amount? Yes. We have looked at this from the point of view of trying to calculate what is the hidden additional burden to the economy of France and Germany represented by
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