The FCO and the Spending Review 2015 — House of Commons, 2016-03-01
Topic: International Affairs
Crispin Jeremy Rupert Blunt (Conservative, Centre-right): It is a pleasure to open the first estimates day debate of the new Parliament, and I thank the Liaison Committee for selecting the first report of the Foreign Affairs Committee for debate I pay tribute to the work of the Committee in the last Parliament and to my predecessor, Sir Richard Ottaway. I was lucky to have him as a parliamentary neighbour for 18 years and can well understand why he was so widely regarded across the panoply of the Foreign Office establishment and those interested in foreign and Commonwealth affairs for the way in which he led the Committee in the last Parliament One of the Committee’s final reports in the last Parliament, which was published in February 2015 only weeks before Parliament was dissolved, took a detailed look at the impact of cuts on the Foreign Office budget resulting from the 2010 spending review. It accepted that the Foreign Office needed to play its part in the general retrenchment instigated by the review and believed that Foreign Office Ministers and senior managers had, on the whole, played a difficult hand skilfully. However, it concluded: "The cuts imposed on the FCO since 2010 have been severe and have gone beyond just trimming fat: capacity now appears to be being damaged. The next Government needs to protect future FCO budgets under the next Spending Review…If further cuts are imposed, the UK’s diplomatic imprint and influence would probably reduce, and the Government would need to roll back some of its foreign policy objectives." I remind the House that the reduction imposed on the Foreign Office in the four-year period ending in March 2015 amounted to 24% of its resource budget. However, the majority of the savings came from what amounted to a conjuring trick. Funding for the BBC World Service was transferred from the Foreign Office to the licence fee payer from 1 April 2014. At a stroke, the Foreign Office’s apparent budget was reduced by £240 million and the cuts that it had to make to its own budget through savings amounted to just 10%. Even though the real reduction was just 10% over the four years, it is hard to find anyone who does not believe that the FCO’s capacity was damaged in the process. Our predecessors described the Foreign Office as a machine stretched to the limit, with key posts left unfilled because staff of the necessary calibre were needed for more immediate crises; overseas posts at junior levels lost, reducing the opportunity for staff to accumulate the experience that is essential for service at higher levels within the organisation; and reductions in UK-based staff at many overseas posts, denying those who remained time to leave the diplomatic bubble and gather a sense of the real currents in society around the country in which they served Overall, the headcount of UK-based staff has reduced by 10% between 2011 and now, which seems perverse at a time when the Department has been under such policy pressure and suffered such overstretch. To some degree, the reduction in UK-based staff was mitigated by the recruitment of locally engaged staff who, in many cases, have brought a depth of local knowledge that it would be difficult for a London-based employee ever to acquire. However, many of them happen to be British people who are based overseas and then formally become locally engaged staff. Although the average cost of such people is one third of UK-based staff, it is not a straight saving, because such replacements do not come at zero cost. I have already heard troubling reports of unintended consequences arising from such things as locally engaged staff not being cleared to the same security level as UK-based staff To use Tunisia as an example in advance of the Committee’s visit to Cairo and Tunis next week, I applaud the FCO’s swift consular response to the terrorist attack in Sousse in June 2015, but I have heard that the subsequent counter-terrorism analysis was complicated by a lack of UK-based staff who were cleared to the necessary level. That analysis was of great significance, because it will have played a role in the FCO’s decision to advise against all but essential travel to the entire country—a country where tourism contributes directly and indirectly to a large proportion of GDP and is a major source of foreign currency. Tunisia is a fragile country that has undergone its fair share of volatility since it sparked the Arab spring, and we all have an interest in nurturing its continued stability.