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Note by the Chiefs of Staff
We have considered the stage now reached in the
settlement of the Defence Estimates for 1953/54, as
described in 0.0.5. (52) 708.
2. The sketch estimates, which have not been prepared on
a strictly comparable basis, amount to £1623M, or to
£1626.5M if the Air Ministry has to provide £6M for local
expenditure in Germany on certain assumptions they would
exceed even this figure. The total approved by the Cabinet
is £1610M.
3. In preparing their sketch estimates, departments have
in varying degrees been forced to accept cuts in pro grammes
greater than any previously contemplated. This is due in
large measure to the fact that in the process of preparing
sketch estimates it became a pparent that the inescapable
"hard Core" expenditure, and the effect of price increases,
had hitherto been seriously underestimated. To make room
for the necessary increases under these he ads, expenditure
under other heads, particularly production and works, had to
be further squeezed, with the results described in
C.0.S. (52) 708 and its annexes.
4. Though by making further injurious and wasteful cuts
some me thod might be found of compressing the defence
estimates for 1953/54 within £1610M, this would only
postpone a little longer the inevitable day of reckoning,
and it is our considered opinion that in the longer term
the limitation of defence expenditure to the level approved
by the Cabinet is really not compatible with the maintenance
of forces, and a re-equipment programme, on the scale now
existing or planned. If the level of expenditure cannot be
increased, the present defence policy of H.M. Government
must be modified; this will involve risks greater than
those accepted in our Global Strategy paper and be a further
step towards the situation we emphasized in D(52)45.
(Signed) J.C. SLESSOR
R. MCGRIGOR
J. HARDING
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