The failure to agree an EU constitution has closed off one solution to Britain’s overstretched defence commitments, so it’s time for a radical review of them, says Tim Garden

The new millennium has seen global security taking a turn for the worse, while the commitments of Britain’s depleted armed forces have been growing.

The 2002 US intervention in Afghanistan has generated demand for UK security assistance there, and this has increased very significantly over the past few months. The rushed intervention in Iraq of March 2003 resulted in new regional security problems, and an extended commitment for both UK forces and overseas aid. Pre-emptive military responses by the US or Israel to a perceived Iranian nuclear threat would have profound implications for UK forces in Iraq. The growing ferocity of the exchanges between Israel and Hezbollah and Hamas threaten the stability of the region.

We have seen the Royal Navy prepare to evacuate British citizens from Lebanon. Conflict in sub-Saharan Africa has continued, and at times has required UK forces to be deployed under UN, EU, NATO or national auspices. The Balkans still require troops. A quarter of a century after the Falklands conflict, we still keep a force defending the islands.

Even nuclear weapons are back on the agenda, as North Korea and Iran ignore international opinion, and as Tony Blair tries to rush through an early decision on the future of the British deterrent.

We are often in danger of looking at each of these crises as though they can be resolved in isolation. Yet decisions in one area of foreign and security policy have an impact in others.

Afghanistan is currently a much more difficult problem than it need have been because of the intervention in Iraq. In October 2001, Jack Straw, made a promise that we would support the rebuilding of Afghanistan into a viable democratic state, so that terrorists could no longer have a safe haven there. Like so much else, the unnecessary intervention in Iraq in 2003 spoiled this plan. The subsequent chaos in Iraq meant that the problems of Afghanistan were put on the back burner.

Hamad Karzai asked for 50,000 troops to help him secure the country. NATO sent a tenth of that number, and could do little more than secure the capital Kabul. Meanwhile, the United States continued its offensive operations in the east of the country to try to find Osama bin Laden using special forces and airpower. Gradually, NATO has extended reconstruction to the north and west; but the south and east along the border with Pakistan have remained bandit country. The opium poppy harvest has again flourished, and finds its way to the streets of Britain. Now British forces find themselves with a growing commitment in Helmand province, and one that may last for many years.

The traditional international structures to promote peace and security have also suffered setbacks. Reform of the UN makes slow progress, and US attitudes, coupled with UN corruption scandals, have reduced the effectiveness of this key organisation. NATO has been damaged by the tensions between members over the Iraq intervention, and by arguments over force commitments for Afghanistan. The US has only recently realised, perhaps too late, the costs of failure to consult with allies.

European defence co-operation has also been hampered by Iraq, but also by the failure to agree a new EU constitution. The divide between the rich and poor peoples of the world widens both through protectionism by the rich and inadequate governance in the poor. Poverty, repression, disease and ethnic disputes increase the sense of despair among the developing world, and will lead to more conflict.

Natural catastrophes are also presenting challenges to governments. They have much in common with the man-made problems that stem from conflict. As climate change increases the intensity and frequency of some environmental disasters, governments will be under pressure to provide more reliable responses than the current ad hoc arrangements, and this will have to be provided by the military.

Meanwhile, UK security policy remains traditional in its structure. By far the largest share of resources (2.2% of GDP) goes to the Ministry of Defence to fund the Army, Royal Navy and Royal Air Force. International Development has yet to meet the UN target of 0.7% of GDP.

Diplomacy, through the Foreign and Commonwealth Office, is smaller still. In resource terms, the MOD:DfID:FCO budgets are in the ratios 32:5:2.

Separately from these three departments concerned with external affairs, the intelligence services and the Home Office have important security roles. While the measures taken since 9/11 have increased co-operation between these different government departments, the relative allocation of resources is little changed. Only in conflict prevention pool budgets is there a small amount of flexing between departments to meet common security challenges.

With the exception of the nuclear deterrent, the UK no longer plans or provides for military defence of its territory against an attack by another state. Furthermore, it is assumed that any major military operation will have to be undertaken as part of a coalition force. These two planning assumptions have removed the underpinning for particular force levels, and have allowed a progressive reduction in combat units to meet budgetary constraints. In an analysis of five years ago, I predicted that by 2020 the defence budget would be down to 1.3% of GDP and the armed forces frontline would be half the size it was in 2000. The trendline since has not caused me to revise these figures.

As our reduced armed forces have to undertake more overseas operations for indeterminate periods, they find themselves in increasing difficulty. The size of the army, navy and air force is calculated on assumptions about the number and nature of future commitments.

The National Audit Office has reported that these ‘defence planning assumptions’ have been exceeded every year since 1999. Too few troops means that they must be repeatedly deployed to operations with insufficient time back home for training and family life.

This leads to earlier retirement from the military, which means more recruits are needed and experience levels fall. The problem is much worse in some specialisations than others. Medical services are in short supply and, as a result, reservists are used disproportionately. But repeated call-up of reservists brings new problems for recruiting and retention to these hard pressed areas. Even when the troops do get home, they have to live in depressing unmodernised accommodation that would be condemned for any other group in society.

While the growing problem of lack of people to undertake these complex nation-building tasks is of concern, there is a parallel problem in terms of shortages of appropriate equipment. The lack of helicopters and suitable vehicles for Iraq and Afghanistan hits the headlines when soldiers are killed by roadside bombs.

The Ministry of Defence equipment budget is in trouble as the growing cost of future projects causes problems. The big money is currently being spent on Eurofighter deliveries. The two new aircraft carriers with their joint strike fighters will be the next big spender, and beyond that Trident replacement looks ready to eat up funds. There is a long list of aircraft, submarines, ships and vehicles that are fighting for priority in a crowded defence programme. The most expensive are the high technology war fighting capabilities which will be delivered many years ahead. Yet our troops need the tools for the stabilisation and reconstruction now.

All this is a problem for any government, and it is easy to criticise them for having too many commitments, too few troops and inadequate equipment.

It is however also a problem for Liberal Democrats. We support international institutions. We want our armed forces to help bring stability to regions where war, famine, terrorism, earthquake or other disasters happen. We do not want to leave ourselves undefended. The riposte when we criticise military overstretch will always be to ask which mission we would abandon. When we identify shortcomings in accommodation, pay or equipment, we must be ready to say what we would do about the defence budget.

Of course a Lib Dem government would not have invaded Iraq, but we might still have called for a UN international force to help sort it out afterwards. Our commitment then might not have been so very different in scale from the current one. We would have supported a better and earlier response in Afghanistan, and that would have led to another demand on our forces.

It is difficult to see that we would want to be less involved in trying to promote stability in lawless parts of the world. Should we then advocate spending more on defence? This seems unlikely when we look at how much the defence budget already overshadows the other elements of public spending, particularly those which also promote security and improve conditions around the world.

Yet there is a growing realisation that the current approach cannot be sustained. We are in danger of ending up with expensive new military equipment but no-one left to operate it.

If the defence budget is fixed, either commitments must reduce or spending priorities within the budget must change. Commitments could reduce if allies took on more of the burden. In the Cold War, we shared the security burden with other NATO members. This is proving more problematic now as some nations prefer to opt for the less challenging missions, and they know that they must bear the costs if they volunteer to deploy. On spending priorities, it is politically difficult to move away from the traditional big ticket items, which are all too often seen as supporting national industries. Again the logic is to look to allies to share the costs of the most expensive systems. Yet, with the honourable exception of the NATO airborne early warning aircraft, there seems little enthusiasm among nations to operate joint owned defence systems.

All this could have been transformed if the EU had been able to move forward in the defence and security policy field. Between the 25 nations, the €180bn that is spent on armed forces each year could provide and sustain ample capability. Yet sovereignty issues hamper even minor co-operation. Indeed, we see a move to more national solutions for defence as the focus moves to countering terrorist attacks at home. The Blair government’s choice of defence partnership with the US has thrown up problems of access to key technology.

So what should we Lib Dems say? Perhaps it is time to take a leaf out of the New Labour plan of a decade ago. Then they announced that they would carry out a Strategic Defence Review on coming into office, and that is what they did in 1998. The world has changed in unforeseen ways since that review. If we are to have appropriate forces to support our foreign and security policy aims, we will need to be prepared to do an equally radical reappraisal of defence priorities. Britain’s days of punching above our weight are numbered if we continue on the current course.

Tim Garden is Liberal Democrat defence spokesman in the House of Lords and a former assistant chief of the defence staff.