Is £1 billion of taxpayers' money being spent on making military personnel redundant?

31 January 2012

"Spending £1billion to axe heroes in the armed forces is a scandalous waste of talent and taxpayers' money."

The Daily Mirror, 26 January 2011

"Some 17,000 troops along with 25,000 civilian staff will go, while the MoD must find another £2billion savings."

The Daily Mirror, 26 January 2011

The Daily Mirror claimed last Thursday in two separate articles that £1 billion is being spent on military redundancies.

The more prominent article led with the headline: "Defence chiefs blowing £1billion on redundancy payouts." It went on to state that "Some 17,000 troops along with 25,000 civilian staff will go, while the MoD must find another £2 billion savings."

The Mirror cited 'a Commons Defence committee' as its source and some of the content appeared to be based largely on a Press Association circulation.

Here at Full Fact we were keen to investigate the facts behind the figures.

The numbers of redundancies

The figures for the number of redundancies cited by the Mirror can be found in a number of news outlets given the figures apppear in the Press Association release. The figures come from the Ministry of Defence Annual Report and Accounts 2010-11 which was released on January 25th 2012.

The report states that:

"In the SDSR, the Government announced reductions in the size of the Armed Forces, reducing the Army by 7,000, the Royal Air Force by 5,000 and the Royal Navy by 5,000. This will help to ensure that the UK has the required force structure, training and equipment to carry out operations, as part of the implementation of the SDSR. The Armed Forces redundancy programme is expected to deliver up to 11,000 redundancies across the three Services and should be completed by 31 March 2015."

When adding together the reductions in Army, the RAF and the Royal Navy we reach the figure of 17,000. 11,000 of these will be cut in the next three years. Incidentally 'the SDSR' refers to the Strategic Defence and Security Review 2010.

In regards to civilian data, Ursula Brennan of the Ministry of Defence reported to the Committee:

"We have a planned reduction. We announced a reduction of 25,000 in the Civil Service and then the Secretary of State announced a further reduction of 7,000 in July. Not all of that is actual reductions in numbers. Some of it was about moving people; for instance, the Met Of?ce and so on, who were moving out of the Ministry of Defence. And certainly not all of those will be done by redundancies."

Therefore the widely reported figure of 25,000 redundancies is in fact somewhat vague as the actual number of redundancies, as opposed to reductions, could be higher or lower once the further reduction of 7,000 is taken into account.

But altogether these figures have been accurately reported by news sources such as the Mirror.

The cost of redundancies

The £1 billion figure cited by the Mirror is slightly more contentious.

The figure cited by the Press Association is in fact £857 million. This figure is hidden deep in the supplementary evidence provided to the Defence Committee under question 127.

The 'surplus' of £857 million detailed in the Ministry of Defence accounts is explained as follows:

"The £857 million represents a budgetary allowance in Annually Managed Expenditure terms, representing the recognition of a potential liability (cost of redundancies) we would incur over the CSR period."

In other words, redundancies are estimated to cost £857 million over the next four years.

Although the Mirror's £1 billion figure has grounding, the rounding involved essentially adds £143 million, an increase of over 16 per cent, to the costs of redundancies, so there is some element of exaggeration in the reporting.

The Mirror also quoted 'an MoD source' as stating that the redundancies would in fact save the armed forces £2.2 billion over the next four years. This statement was also found in the Press Association release.

Full Fact have contacted the MoD in order to identify this particular source and clarify that this is the case. We are also awaiting confirmation on the Mirror's claim that a further £2 billion must be generated by the MoD. 


The Mirror's claim that £1 billion of taxpayers' money is being spent on making members of the armed forces redundant is somewhat higher than the official figure of £857 million and could cause rounding concerns, but the general point is accurate.

Redundancy figures correctly reflect the data arising from the Defence Committee report, but Full Fact is awaiting clarification from the MoD as to whether or not these redundancies will result in savings of £2.2 billion over the next four years and whether or not an extra £2 billion worth of savings must be saved in addition.

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