The Edge

Richard Northedge takes on corporate finance

Scrap Trident – but keep it a secret

Who should run the Royal Navy? Admirals or accountants? With a replacement for the Trident nuclear deterrent costing £20bn, recruiting a few bean-counters to the poop deck makes sense, but maybe an illusionist is what is really required?

The cost is big money even if the country was not in an austerity squeeze. So chancellor of the exchequer George Osborne was right to tell defence secretary Liam Fox that the money must come from the Ministry of Defence’s core budget rather than some Treasury contingency fund.

Such financial discipline concentrates minds. If the cost comes out of someone else’s budget, of course the admirals will demand to have Trident; if it means having to sell an aircraft carrier or sack sailors, the top brass will start thinking of value for money.

This is not an ideological argument about the ethics of nuclear attack or about pacifism but a debate about deploying resources. It is not even a split between the political Left and Right – and ought not to be clouded by issues such as whether jobs go to Rolls-Royce and BAE or back to the original Trident builders, Lockheed Martin.

But if the prime minister chose to make it an argument about whether Britain is a junior partner to the United States he could consider the unthinkable and outsource this element of British defence to the Americans. If not that, the upcoming defence spending review should consider other ways to reduce the £20bn cost.

That might mean cutting the order from four to two submarines to replace the current Vanguard fleet – though the fixed costs of design may mean the savings are marginal and if we cannot always have one fully-armed sub at sea, is there any point having Trident at all? Or it might mean building deal-purpose subs that can perform non-nuclear tasks when required.

However, the most likely outcome is the traditional Whitehall answer to a squeeze on finances – delay. Make the Vanguards last longer and hope that the public finances look better in five years’ time. The result will then be to order a defence system that is five years out of date.

So the correct answer is to cancel Trident. But wait, here’s where the illusionist comes in. We cancel it but don’t tell anyone.

Trident is there as a deterrent – not as a missile to be used. The consequences of firing it would be disastrous. So as long as the enemy (choose from the long but revolving list of perceived foes) think we have it and thus do not attack, it has worked. The illusionist can create a sham industry pretending to build the system. And the chancellor can spend the £20bn on something more useful – probably paying off debt.



Post a comment

By posting on this blog you are agreeing to abide by our website comment policy and all posts are subject to the approval of the website editor. We will remove posts that contain offensive or threatening language, personal attacks on the writer or other posters, posts that are off topic and posts that are considered spam or specifically used to promote any commercial products or services. Any poster who repeatedly contravenes the policy will be banned from posting on the website.