Hammond dismisses Army cuts warning
Philip Hammond has dismissed a warning from the public spending watchdog over plans to save billions of pounds by slashing the regular Army and boosting reservist numbers.
The Defence Secretary said he was "confident" that the target of 30,000 part-time soldiers would be hit by 2018, despite the National Audit Office (NAO) concluding it could take six years longer.
The watchdog's report also expressed alarm that ministers did not know whether the policy was "feasible" when they signed it off three years ago, and questioned whether the new structure would even deliver the predicted £10.6 billion savings.
NAO chief Amyas Morse said: "The department and Army must get a better understanding of significant risks to Army 2020 - notably, the extent to which it is dependent on other major programmes and the risk that the shortfall in recruitment of new reserves will up the pressure on regular units."
Publication of the findings - delayed for several days amid wrangling with the Ministry of Defence (MoD) - prompted a wave of criticism from politicians and military figures.
Former head of the Army Lord Dannatt accused Mr Hammond of "wishful thinking", saying his approach was "based on hope rather than any science".
"I think, for Philip Hammond to say that he has every confidence that this will succeed, I think that confidence is based on a certain degree of wishful thinking," he told BBC Radio 4's World At One.
Even if the goal of increasing reservist numbers is met by 2018, there will be at least three years before then when the Army is under strength, he said.
"If it stays relatively quiet and we are not committed anywhere then the risk will not materialise, but if something happens, the strategic shocks happen, and we are terribly bad about spotting them, then we could be embarrassed and we could be in some difficulty," he added.
Margaret Hodge, chairwoman of the Commons Public Accounts Committee, attacked the "scandalous" £1 million a month being spent to cover "incompetence" in the reservist recruitment process, which has been plagued by IT failures.
"The Ministry of Defence focused heavily on cutting costs rather than on recruiting, training and integrating a substantially increased number of reserves, something the Army is already failing to do," the Labour MP said.
"The MoD went ahead with plans to reduce the number of regular soldiers and increase the number of reservists from 19,000 to 30,000 by 2019 without even investigating whether it was possible to do this by that time, or even whether it had 19,000 trained reservists to start with.
"Given this, it comes as no surprise to me that just one third of the reservists have been recruited in 2013-14 and the size of the Army Reserve has not increased since 2012."
The NAO said while a larger reservist force had lower costs for the MoD, it could place more burden on the Treasury. Major operations are funded from that department's reserves, and the bill for deploying part-timers is higher.
Tory backbencher John Baron said Mr Hammond's reputation was now "on the line".
"Army 2020 was always a cynical 'balance sheet' exercise by the MoD, as the report confirms," he said.
"Replacing the cost of 20,000 regulars by the Treasury meeting the heavier costs of deploying reservists might help the MoD meet financial targets, but could cost the taxpayer more. False economies loom large.
"For those of us who opposed the Army Reserve plans, it was clear financial necessity rather than strategic design was the driving force. Unacceptable capability gaps and false economies are the price.
"Given the utmost importance of these reforms, the Defence Secretary's reputation is on the line."
The Army 2020 restructuring programme forms part of the package of defence cuts originally set out in the coalition's 2010 Strategic Defence and Security Review (SDSR).
It will see the regular Army reduced to its lowest level since the time of the Napoleonic Wars.
The NAO found that the key decisions on Army 2020 were "taken without appropriate testing of feasibility", and raised concerns there had been no significant growth in the overall trained strength of the Army Reserve in the last two years.
But Mr Hammond said he was still confident about hitting the target of having 35,000 reserves across all three services by 2018.
"The MoD has always been clear that the numbers in the reserves would fall before they increased, but we have now seen the trained strength of the reserves climb for the first time in nearly 20 years," he said.
"The well-publicised IT issues in the Army Recruiting Centre are being addressed, the application process has been simplified, medical clearance procedures have been streamlined and the Army is running a high-profile recruitment campaign.
"While there is much still to do, we are confident of achieving the target of 35,000 trained reserves by the end of financial year 2018.
"The armed forces are being restructured to ensure they can defend against new and emerging threats to our security.
"In future, they will be smaller, but better equipped, able to deploy rapidly to protect our interests anywhere in the world and supported by an integrated reserve force."
Asked about the issue at Prime Minister's Questions, David Cameron said the Government inherited a reserve that had been "under-resourced and undervalued for years".
"We now have a five-year programme for building them up.
"That programme is under way, it is gathering pace. What we are going to see is the strongest possible professional Army with all of the best equipment they could have, and a very strong reserve force backing up, making sure we can meet all of the obligations we set out in the Strategic Defence Review."
The head of the Army, General Sir Peter Wall, said: "The NAO report fails to capture the nature of the austerity we faced at the time these decisions were made.
"The Army has designed a novel and imaginative structure which best meets the challenges we are likely to face within the resources made available.
"Thankfully, most of the structural change for our new model, which we call Army 2020, is now behind us. We are recruiting regular and reserve soldiers for this new Army avidly.
"I am confident that, having made such significant changes, the Army 2020 model will endure."
Conservative MP Julian Brazier, a former reserve officer who served on a commission appointed by the Prime Minister to review the role of the reserves, strongly criticised the NAO's findings.
"It fails to give any context prior to the last couple of years, and represents an imaginative blend of some new ideas with a traditional approach to reserves as a radical leap in the dark. It is unworthy of the National Audit Office," he said.