12 February 2019

Both the EU and the UK want a strong defence and security partnership after Brexit. But this cannot be achieved under the terms currently set out in the Brexit deal, writes Georgina Wright.

Theresa May outlined her ambition for a strong UK-EU security partnership at the Munich Security Conference last year. And in the run-up to this year’s gathering the EU’s Deputy Chief Brexit negotiator, Sabine Weyand, encouragingly insisted that ‘foreign policy, security and defence are the least controversial parts of the political declaration’.

But the current arrangement proposed in the political declaration – the part of the Brexit deal which sets out the future EU-UK relationship – is not fit-for-purpose; it is also short-sighted.

Weyand is correct to point out that it may be easier for the UK and EU27 to find common ground on external security and defence than on trade. For starters, the EU has played a limited role in these areas. Most member states are NATO allies. Of the six that are not, almost all engage with NATO either directly or through EU-NATO cooperation agreements.

Second, there are special agreements between two or more EU countries, for example the 2010 Lancaster Agreement between France and the UK. These would continue – irrespective of whether the UK exits the EU with a deal or not.

The UK needs the opportunity to contribute to EU defence and security planning

The EU has a small number of civilian and military training missions abroad in which the UK has played a key role in the past – from contributing troops to designing and leading the missions themselves. The EU also has an important external budget which it uses for capacity and institution-building in areas of conflict, such as in the Sahel and the Central African Republic.

The Political Declaration holds out the prospect that the UK could continue to participate in EU missions and contribute to the budget, but is vague on whether it could have more say over strategic decisions than other third countries.

The EU has already shown reluctance to think beyond existing rules, with the exclusion of UK firms from bidding on contracts for the security elements of the Galileo programme the highest profile case to date.

But this approach is counterproductive. It is true that third countries have limited say over EU decisions, but the UK plays an influential role in the EU’s approach to defence and security – notably as a key member of the political and security Committee in the Council of the EU.

On Russia for example, it has traditionally taken a tougher stance than Germany or France – a position that was supported by Poland and Romania. It also championed closer cooperation with Canada and the US in Ukraine and the Western Balkans.

If the EU27 are serious about working closely with the UK on security and defence, they may need to go beyond the offer of regular dialogues on areas of shared interest. Instead, the EU should consider giving the UK a role in shaping the EU’s long-term strategic planning.

The UK and the EU require a change of mindset on a security partnership

The UK will need to be realistic on how much influence it can exert over the EU once it has left. It will need to work harder on building support for its positions in Europe as well as increase its engagement in Brussels and EU capitals.

On the EU side, it may require adapting the way it cooperates with third countries – reluctant though it may be to make an exception for a departing member state.

Sabine Weyand and Theresa May are right that a strong UK-EU strategic security and defence partnership is possible, and indeed desirable. But for it to be effective, it cannot be constrained to the EU’s existing models for cooperation with third countries. Instead, it should go above and beyond the structures prescribed in the political declaration to ensure that the UK and the EU not only cooperate, but also determine joint priorities going forward.

Comments

It is time to break free from the dead hand of EU regulation and bureaucracy, which has been the cause of lack of competitiveness in the domestic market over the last several decades.

Consider, for a moment, the market in defence equipment.

The default policy of Governments of all persuasions has been to procure military equipment for the Armed Forces through fair and open competition – the only exceptions being off-the-shelf purchases and single-source development contracts, the latter to be awarded on a preferential basis (to the Select Few).

Indeed, in its most recent policy statement on defence procurement expressed in the Defence Industrial Policy published in December 2017, the Government says (on page 23):

“We strive to provide our Armed Forces with the capabilities they need at the best value for money, obtaining this through open competition in the global market, wherever possible. Competitive tension is the greatest driver for innovation, productivity and earning power in any economy.”

Yet, in the very next sentence, the Government goes on to make this frank admission:

“In 2016/17, 58% of new MoD contracts by value were placed on a non-competitive basis. This has grown from 36% in 2010/11 ……”.

So, it seems that less and less use is being made of the market-based instrument of fair and open competition – which happens to be the Government’s preferred policy on defence procurement. There is a suspicion that senior executives seconded from the defence industry and embedded within the Ministry of Defence, who remain in the pay of their employers, may have exercised their maligned influence to interfere with implementation of policy to serve their narrow business interests. Or is this a clear-cut case of the senior civil service subverting the will of the party of government and policy set by Ministers? What Trump calls the "deep state".

It is entirely understandable why the Government would want to hand out uncontested, single-source development contracts to selected defence contractors on a preferential basis, but the downside is that there is a price to be paid for this Government largesse – and it is not only in pounds sterling!

Over the last 45 years or so, the UK’s top defence contractors who have monopolised the market in military equipment, have become seriously uncompetitive – largely because they have enjoyed unbridled protection from Government on national security grounds. Which means that they are ill-equipped to contribute towards the Government’s vision of a thriving and globally competitive defence sector trading freely with countries beyond the EU, post-Brexit.

Indeed, since joining what was then the European Economic Community, successive Governments including that of Margaret Thatcher – the original champion of free markets – have gone out of their way to shield domestic equipment manufacturers from "feeling the heat" of competitive market forces, by denying continental rivals the opportunity to bid for UK defence equipment acquisition programmes, which is allowed under Article 346 of EU procurement regulations on war-like goods.

The results are entirely predictable. The defence industry has become grotesquely inefficient on the back of endless subsidies from Government, which it expects to receive in perpetuity – cultivating an entitlements culture. As a consequence, it has failed time and again to deliver equipment to the Armed Forces which is fit for purpose, adequately sustained in-service and constitutes value for money through-life.

Additionally, it has got away with not investing in innovation, research and development, creating intellectual property or upskilling employees – despite quietly hoarding mountains of cash and putting it to no particular use.

These are the same business interests that are secretly lobbying the governing elite right now to remain in the Single Market and the Customs Union so that they can continue to be protected from being exposed to the full rigours of the free market.
@JagPatel3