Cash crisis hits staffing of military

Severe funding constraints have forced the Defence Force to limit recruitment, despite being 2500 staff short for the job the Government has been asking it to do.

The finding is one of many included in a major report into Defence Force capability and resourcing which reveals it has been effectively operating in crisis mode for some years.

Defence Minister Mark Burton released the report yesterday, responding by pledging to commit $4.6 billion in new defence spending over the next 10 years.

The report was commissioned by the Government in 2003 and conducted by the Defence Force, the Defence Ministry, Treasury and the State Services Commission.

Widespread changes have been recommended - including the need for much improved strategic planning and policy development within the two defence agencies.

The changes will be overseen by the Treasury and SSC, although Mr Burton's office last night denied they were "babysitting".

The funding injection is primarily aimed at improving staff retention and recruitment.

Staff levels have dropped from 20,785 in June 1991 to 12,889 at the same time last year, with the Army attrition rate now at 18 per cent.

At the same time overseas engagements soared.

Through the 1990s between 2 and 6 per cent of staff were on operation deployments, but largely due to peace-support operations that figure is now between 14 and 25 per cent.

There have been four pay rises in four years to address the staff shortage and a series of recruitment campaigns.

Yet the report said Defence Force Chief Air Marshal Bruce Ferguson had imposed "limits on personnel numbers" as a response to "funding constraints".

Paid strength was "substantially below the required levels".

The report found "the shortfall between the numbers required to deliver the currently directed level of capability required by the Government without risk is around 2500, although the exact number fluctuates."

Defence Force headquarters senior staff have been plundered to fill deployment gaps, the report continues, leaving it "critically short" of relevant staff.

This in turn has seriously affected its strategic planning and management capabilities in which there are "acknowledged weaknesses".

The Defence Ministry also lacks the expertise to advise the Government on key issues such as military technology, cost-modelling and human resources modelling.

All three services suffer from shortages in contingency reserve stocks of key items, including ammunition and spare parts.

The Army alone believed it would need to spend $170 million on these stocks in the next 10 years.

The report also found significant upfront investment and ongoing expenditure - about $450 million over 10 years - was needed to restore the defence estate.

Policy decisions needed to be made about the future of the Defence Force's 2548 houses and on the future uses of Army bases at Papakura, Waiouru, Linton and Burnham.

Spending on the estate should be considered "mandatory not discretionary" the report said.

Mr Burton said by the end of the 10-year funding package, the Government would have increased the Defence Force operational baseline spending by 51 per cent.

The initiative was the fourth stage of a systematic approach by the Government to restore capability.

It was hoped the funding would enable personnel numbers to recover by 1500 to 2000 over the 10 years.

The recruitment and retention issues could not be resolved overnight, particularly given the highly competitive job market, he said.

Air Marshal Ferguson welcomed the funding and hinted another round of pay rises was on the way this year.

The first report-back on how the funding is spent is expected in June.

National defence spokesman John Carter said the Government was playing "catch-up on an issue they created themselves".

"This Government has taken us into an isolationist peacekeeping mode that does nothing to attract people who want to get involved in active defence of our nation," the Northland MP said.

Green Party defence spokesman Keith Locke said the Government did not need to spend more.

Rather it should get rid of the frigates and divert the money into other personnel and equipment areas.

Supply shortage

* The Army, Navy and Air Force all suffer from shortages in contingency reserve stocks of key items, including ammunition and spare parts.

* The Army alone believed it would need to spend $170 million on these stocks in the next 10 years.

* About $450 million is needed over 10 years to restore the defence estate.