During his speech, Mr Hammond looked back on where MOD was 4 years ago and the efforts that have been made to transform Defence into a ‘disciplined department with a clear sense of direction’.
Mr Hammond talked about the efforts MOD has made to effect this change; one of the biggest transformation programmes ever undertaken in the western world.
He spoke of making tough decisions to get the budget under control, retiring long-running capabilities, making cuts to armed forces manpower and overhauling the infrastructure and equipment organisations:
We have balanced the books by taking a hard-headed approach to what we can and cannot afford.
We’ve published a balanced and deliverable equipment plan, something the government has not done before, giving everyone within Defence greater transparency and greater certainty to be able to plan for the future.
The need for a leaner, more strategic workforce was also stressed in Mr Hammond’s speech.
The objective of having the right people in place and fewer people doing a better job were part of the foundations of his argument that MOD is now running in a more businesslike manner.
Making reference to accountability and responsibility in terms of maintaining a stable budget he said:
We chose to delegate budgets downwards to the front line commanders. People now have a vested interest in knowing both the cost and the value of what they are doing. Now they are responsible for managing their multi-billion-pound businesses.
And it has paid off. We only commit when we’re sure we can afford not just the capital cost but the year-on-year running costs as well.
Decisions like whether we invest more in simulation by reducing live flying hours should clearly be taken by the RAF and not by politicians in Whitehall. Already, this devolution of power from the centre has paid dividends in promoting a culture of initiative.
Towards the end of his speech he spoke of the current imperative ‘to institutionalise innovation throughout the organisation’, describing it as ‘the lifeblood for reform’.
He emphasised that it was being achieved by empowering people with clear objectives on what they must deliver but with flexibility about how they deliver it.
Mr Hammond concluded his speech by saying that he was proud of what has been achieved so far but reiterated that there is still work to be done.