British defence cuts cause Nato 'free-fall' fears

THE North Atlantic Treaty Organisation wants member states to stabilise their defence budgets to prevent a round of cuts turning into a 'free fall', officials said yesterday. Though the latest British defence reductions were received with relative equanimity, there is concern that a spate of savings among alliance members is making future force planning very difficult.

Nato sources said yesterday that since the new British defence statement did not hit land forces - the main area of worry - they were 'not unduly concerned'. The cuts were chiefly aimed at reducing commitments in areas where the end of the Cold War has reduced the threat, especially defending Atlantic convoys.

Indeed, British officials said there had been some favourable reaction to increases in spending on air transport, including support helicopters and Hercules transports. The cuts, which hit the Royal Navy and the Royal Air Force, and the shift towards transport, emphasise the 'critical' importance of Britain's forces to Nato's Rapid Reaction Force, officials said, and the move away from Cold War tasks.

But Nato sources said that there is a desire at the organisation's Brussels headquarters to establish how far defence cuts will go in all the 15 nations that are part of the integrated military structure. Without such knowledge, 'force planning suffers grievously', said a Nato source.

At the end of this month, Nato members are due to complete a questionnaire indicating which forces they intend to commit to Nato. By the end of the year this is turned into an overall view of the forces available to the alliance. Before then there will be a Nato summit, intended to underpin the alliance and in particular the link with the US. In the spring defence tasks are allocated to each nation.

There may be trouble over this process this year, since the sharp reductions in forces on both sides of the Atlantic have not been managed on a multilateral basis. Rather, in the absence of a clear threat from the East and with budgetary pressures mounting, cuts have happened 'willy-nilly', said one analyst. Moves to create a joint European force involving France, Germany and Belgium have also clouded the prospects.

Britain, which spends more on defence than many of its alliance partners, plays an important role as a provider of forces to Nato, but also as an exemplar to other nations. After the United States and Greece, it has the third highest ratio of spending to national economic output.

At the alliance's special summit later this year there may be a move to get a commitment from heads of government to stabilise defence budgets at present levels.