OUR Dear Leader has had a very military couple of weeks. However his aspirations to channel Churchill will end badly. Starmer is more of a Quisling or a Petain. That is what his Lancaster House EU defence pact – a ‘promise’ of more defence contracts – agreed with the EU on Monday betrays.
The bottom line is that the UK doesn’t need a deal to participate in the EU’s increased defence spending. We’re already going to benefit because British companies are manufacturing much of the hardware that the EU will be purchasing.
After a busy couple of weeks ordering an update of planning to deal with a nuclear strike by Russia, going to Norway to discuss the Joint Expeditionary Farce and posing for the papers in military attire (when did Prime Ministers dressing up as soldiers become a thing?), with the population and media drunk on VE Day nostalgia, Two-Tier sold them the dummy. The UK might gain access to the €150billion EU rearmament fund. The price: closer alignment with the EU. Most of the mainstream media have lapped it up. Allow me to prick some balloons.
There is a strong EU arms industry, especially in UK (BAE Systems and Rolls-Royce), France (Safran and Thales) and Germany (Rheinmetall, Thyssenkrupp). There’s also Airbus, which is somewhat incongruously registered in the Netherlands. Lower down the manufacturing food chain, most EU countries have a defence industry worth over €1billion per year – perhaps simply making ammunition or simple weapons like the ubiquitous AK-47, still made in Bulgaria. It’s clear that Europe is more than capable of arming itself. The problem is that, to date, it hasn’t wanted to.
The economic reality is that spending taxpayers’ money domestically creates growth which may, in time and in theory, defray the tax burden of buying the weaponry in the first place. The EU’s €150billion fund, part of an €800billion four-year programme, will raise money on the markets (i.e. borrow) to support the scaling up of EU member nations’ defence.
Defence procurement is conducted nationally, not by the EC. Where do you think a sensible defence minister, like all politicians most worried about re-election, will seek to place orders? Their own country, another EU country in a bit of tit-for-tat favour trading in Brussels or with the UK? Only if the equipment is unavailable from EU sources, or (more likely) the manufacturing consortium includes UK companies, will the UK get a look in.
The programme is limited to four years, although of course this could be extended. However, that is offering the EU states opportunities to buy more of the same and, possibly, to build more ammunition factories, as many are already doing. In the UK BAE Systems have invested £150million to increase their artillery ammunition manufacturing capacity 16-fold. Of course this substantial expansion is measured against a low baseline: like most countries the UK has run down its armed forces and with that the domestic demand for ammunition.
Most defence equipment has a long lead time. When the British Army sent all its NLAW anti-tank weapons to Ukraine and then sought replacements they discovered that there was no spare capacity and that future production had already been sold to other armies. They may or may not have been able to buy the production slots from others. The point is that a wall of money and demand hitting an industry with a finite manufacturing capacity will create price inflation (and increased profits for the arms manufacturers).
Developing new weaponry is time-consuming. The Eurofighter took around 15 years from concept to delivery of the first aircraft. Notwithstanding the ‘AI and drones will fix it’ school of military thought (a term used loosely), increasing EU defence spending means buying more existing weaponry, much of which is made (or part made) by the UK defence industry. If a country wants to buy more Storm Shadow missiles from MBDA, BAE is a shareholder and work partner. More Meteor missiles for your Rafael fighters, President Macron? MBDA makes them too.
Most of the EU’s 27 members have a military capability. The €150billion over four years is just about a 10 per cent annual increase on the EU’s annual defence spend of €326billion. That’s total spending, which includes pay, fuel, barracks maintenance and the like. The Nato guideline is that just 20 per cent of defence spending goes on equipment so Two-Tier’s much trumpeted €150billion is in fact just €7.5billion per year to spend on equipment. That’s more like thirty pieces of silver than a transformation to the UK’s defence economy.
What’s more, the UK already exports £16billion of arms to Europe every year. That is three times the potential spending uplift. In fact it rather suggests that we’re going to take that money anyway as UK companies are already embedded in the supply chains of many European arms procurements, not just the Eurofighter and the F-35. The EU isn’t our biggest arms export market, it comes third, behind the Middle East and the United States. It may well become the fastest growing but we’re already deeply embedded in their supply chain.
While the EC might rule that the 10 per cent uplift can’t be spent in the UK, the other 90 per cent can be, and is. If Two-Tier did nothing and signed nothing the UK would get its share of the EU’s increased defence spending. The ‘€150billion’ is a mirage.
Starmer no doubt hopes that the UK would have access to the fund to underwrite the increase in defence spending that he has announced, increasing the pressure on his Chancellor’s plans. That is ludicrous – the UK can (and does) borrow from the markets itself. The UK’s (hypothetical) share of the (as yet non-existent) fund comes out at around £4billion, or £1billion a year. In the Treasury that’s known as a rounding error. It’s also a drop in the ocean in terms of the £12billion or so annual increase in defence spending the government is committed to.
This benighted government has a track record of signing things away for no good reason. Giving away the Chagos Islands to Mauritius and paying them to take them benefits no one but China (and costs Joe Taxpayer another £90million a year for 140 years).
Two-Tier’s desire to get closer to Europe involves enacting the disastrous deal that effectively (and rightly) got Theresa May sacked. The European Defence Fund (whence the €150billion comes) is part of a three-legged structure that the EC hopes to impose on its member states. The other legs are PESCO – the Permanent Structured Co-operation agreement – and the European Defence Agency. Joining those organisations is a de facto signing away of the exclusive control of British Armed Forces, as first explained by Lt Gen Jonathan Riley here and in up-to-date detail on the developments in EU defence architecture and obligations in this series.
In return we have sacrificed more of our already eaten-away fishing rights, and agreed further unfettered free movement for EU youth and yet more open borders, which Two-Tier somehow thinks will make the working man in the UK wealthier (he’s wrong). He’s undoing Brexit at the stroke of a pen.
Starmer isn’t a democrat, he’s a wannabe autocrat, a dictator. Over 17.4million people voted for Brexit, just 9.7million voted for Two-Tier’s Labour government and yet he intends to sign away control of our armed forces and borders and fishing to get ‘closer’ to the EU that the British people have already rejected.
We must say NO to Starmer the EU junkie.
