NCPA - National Center for Policy Analysis

Privatized British Military More Efficient

March 29, 2002

The British spend less on defense every year than France and about the same amount as Germany (see figure), yet of all the countries in the North Atlantic Treaty Organization (NATO), only the United Kingdom has the capability to deploy advanced military assets to far-flung theaters of operation in support of U.S. forces.

There are a number of factors explaining why, including the British military's superior training and traditionally strong leadership. But in recent years, the most decisive factor has been its willingness to do what no other European country will consider: privatize the military.

Like all Western militaries, the British military has undergone significant budget reductions since the end of the Cold War.

  • From its peak in the mid-1980s, British defense spending has declined more than 30 percent to a current level of 2.7 percent of GDP.
  • The British Army's manpower was reduced by a third, and Britain faced the difficult choice of either continuing to reduce its forces or further slow the pace of modernization.
  • In response, both Conservative and Labour governments engaged in a series of defense privatization contracts totaling $4.6 billion.
  • As a result, by 1998 nearly 200 non-combat defense activities had been privatized for an estimated savings of $685 million (33 percent).

Privatization reached virtually every sector of Britain's defense establishment, including: airfields, dockyards and Army bases; personnel recruitment and training; equipment supply and maintenance; military satellites; Internet services; payroll; research facilities; and logistical support and transport.

Funds that are saved from noncombatant military spending will allow the military to purchase new combat technology that will increase its fighting efficiency, including replacing the Royal Air Force's aging Hercules transports and Harrier jets and aging Invincible Class carriers.

Source: Wess Mitchell, "Privatizing Defense: Britain Leads The Way," Brief Analysis No. 391, March 29, 2002, NCPA.

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