UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 1 39- x v i

House of COMMONS

Oral EVIDENCE

TAKEN BEFORE the

Scottish Affairs Committee

THE REFERENDUM ON SEPARATION FOR SCOTLAND: DEFENCE

WEDNESDAY 23 JANUARY 2013

PROFESSOR MALCOLM CHALMERS and PROFESSOR RON SMITH

Evidence heard in Public Questions 2156 - 2303

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Oral Evidence

Taken before the Scottish Affairs Committee

on Wednesday 23 January 2013

Members present:

Mr Ian Davidson (Chair)

Mike Freer

Jim McGovern

Iain McKenzie

Pamela Nash

Mr Alan Reid

Lindsay Roy

________________

Examination of Witnesses

Witnesses: Professor Malcolm Chalmers, Research Director and Director, UK Defence Policy Studies, Royal United Services Institute, and Professor Ron Smith, Department of Economics, Birkbeck College, gave evidence.

Q2156Chair: Gentlemen, can I welcome you to this meeting of the Scottish Affairs Select Committee? As you know, we are conducting a series of inquiries into the impact of possible separation on Scotland with a view to trying to put as much information as we can in front of voters in Scotland. Today, with your help, we are exploring various issues concerned with defence. The intention is to publish a report in due course, trying to clarify as far as possible the options that will be available to people in the referendum. I start off by asking you to introduce yourselves and tell us about your area of expertise for the record. Professor Chalmers, as a previous attendee you will be familiar with us, so do you want to start?

Professor Chalmers: Very briefly, Chair, I am Malcolm Chalmers. I am a director of research at the Royal United Services Institute in London, and I have written a couple of things about the very subject you are discussing today.

Professor Smith: I am Ron Smith, professor of applied economics at Birkbeck College, where I actually teach econometrics and statistics, but I have been writing on defence economics issues since the mid-1970s and have a book on military economics.

Q2157Chair: As an encouragement, Professor Smith, if you do very well here today, then, like Professor Chalmers, you may be asked back again. That is the accolade to which you can only aspire. You will have seen the resolution passed at the SNP conference. We want to start by asking about your first impressions of the resolution-the way it is constructed, and what it suggests about the defence posture of Scotland and its affordability-and then we will go into more detail.

Professor Smith: For a country of 5 million to spend £2.5 billion on defence with armed forces of 15,000, it is perfectly understandable and seems quite reasonable in a steady state. The real difficulty is going to be getting there from here, because most of the equipment they inherit will be inappropriate. One of the things they will inherit, which will be a real problem, is UK attitudes and assumptions. The ex-MOD or ex-UK military who go there will have all these sorts of assumptions. If I was advising anything, it would be to copy the Bank of England and get a foreigner to run it and have somebody from Ireland or Denmark as their chief planning officer to start with, because they would have some understanding of how you do defence policy in a small country. Somebody who goes from a big corporation to a small firm does not have all the things they took for granted. Creating a Defence Ministry, procurement arrangements and buying things, when they come with UK assumptions, will be a real mental change, so that transition will be really hard.

Professor Chalmers: What Ron said is right. The document goes only part of the way to realising what he is saying. The defence challenges facing a small country like Scotland would be very different. It would not be simply a mini-UK; it would be more comparable with countries like Ireland, Denmark and Norway. To illustrate that with some numbers, the SNP projection of service personnel numbers is about 16,000 full-time equivalents, and in 2020, which is when we are talking about, that will be about 11% of total UK personnel numbers, but they are talking about a defence budget that is more like 6% or 7% of likely UK defence spending, excluding operations, in 2020, so you have got a much higher proportion of personnel than you have of spending. You can make those two add up, but only by having a defence budget for Scotland that spends a much higher proportion of its budget on personnel and a much lower proportion on equipment.

That is something that some other European countries do. For example, Denmark spends a much higher proportion of its budget on personnel than we do, but it does not have much expeditionary capability; it is focused much more on close-to-home activities and is much more army-centric. Hidden behind those numbers, in so far as the SNP has thought about how they add up, is a very different sort of force from the one we are used to in the UK. Ron is right that, if it was staffed mainly by people who know how to work in a global military parallel of the UK, they will be sadly disappointed to serve in a force with much less ambition.

Q2158Chair: You mentioned the 15,000 being disproportionately large in personnel terms compared with what you would expect. Do you think that is because they are starting from where they are rather than where they would want to be and working backwards? I have the impression that they have started from the perspective that all the Scottish regiments should remain Scottish and, therefore, that gives them x and that is their commitment, rather than defining what their foreign and defence policy is and, therefore, what they need. Is that a reasonable set of assumptions?

Professor Chalmers: That may well be an important reason for coming up with the numbers. You would have to ask them how they came to the numbers. You can read into it that they are talking about a much more army-focused force structure, which is consistent both with wanting to appear more like continental European countries, but also the stronger political imperative of the Scottish regiments as compared with maintaining naval or air capability.

Professor Smith: Their central security issue is going to be naval; it is the fisheries, the oil and so on. The question is how you provide that. It is a very long coastline, so providing a navy, even though it does not have the same heritage role as the highland regiments, is going to be important.

Q2159Chair: Can I clarify what having personnel-centric armed forces means in terms of deployment? I understand from what you said that it means you do not have the naval resources, but what are the other implications of that of which we might be aware?

Professor Chalmers: It is an army personnel-centric approach. We are not talking about a highly agile and deployable army, at least not autonomously. It would be what most small European countries do, which is, if they deploy in the ISAF mission in Afghanistan, for example, they use not their own strategic transport, but that of other countries. It would be a situation in which, in this scenario, Scotland could, if it wished, provide forces to supplement UK forces, as the Danes and Estonians have done in Helmand, but for all sorts of enabling assets, which are much more expensive and nonpersonnel intensive, they would be very reliant on the UK or other allies to do that. The SNP have said-it is very likely-that an independent Scotland would be a member of NATO and would be reliant on other NATO members to do that.

That illustrates a broader point that Scotland and the rest of the UK are part of the same country right now. Even if they were not, the degree of interdependence on a whole range of issue areas would be enormous, not least in the area of security. One of the questions that the SNP document does not explore is what that sort of interdependence would be. What are the areas in which Scotland would continue to rely, on their scenario, on the rest of the UK in defence in areas like those Ron mentioned-maritime patrol, air patrol and so on-where it would be very hard to have a totally autonomous capability?

Q2160Chair: Following that point up, would it be reasonable to assume that, in combined operations, the role of Scotland would be to supply, as it were, boots and blood rather than autonomous forces or support forces? They would be providing simply the bodies, so to speak, rather than any complete, self-contained units?

Professor Chalmers: There could be not self-sufficient units, but there could certainly be units-infantry battalions or whatever should be self-contained and under their own command-but, inevitably, the smaller the country you are in NATO, the less share you will get of more senior command positions.

Q2161Iain McKenzie: My understanding is that you are saying that Scotland would likely have an army that would need to hitch a lift everywhere. Would that be in Europe or beyond? Would that be in joint manoeuvres? Would that be to areas of conflict? To what level would they need to get assistance virtually to get to the battle?

Professor Chalmers: It is a matter of degree and size. On this budget, Scotland could afford some transport aircraft, but the more difficult the place to get to, the further away it is and the more equipment they have to take and so on, the more they would have to rely on others. The French are relying a little bit on the UK to get to Mali, so even the larger European countries rely on cooperation to this extent.

Q2162Iain McKenzie: The UK offered them two aircraft.

Professor Chalmers: Yes.

Q2163Iain McKenzie: In that case, it was a UK decision just to offer those two aircraft?

Professor Chalmers: Yes, it was.

Q2164Iain McKenzie: So it could be the same scenario for Scotland?

Professor Chalmers: But much more so, I think.

Q2165Iain McKenzie: If they ask for forces or transport, maybe another country will say, "We can’t," or, "We won’t," or, "We’ll give you x, but we are not going to give you what you are asking for."

Professor Chalmers: That is right. For small countries in Europe, the only autonomous capability they need is in relation to scenarios that are about their particular national interest. The Greeks do not want to be entirely reliant on the rest of NATO if they have trouble with the Turks, and the Scots do not want to be reliant on everybody else if they have a problem with unrest on the streets of Glasgow, or whatever it might be. If you are talking about intervening outside Europe, I imagine the Scots would have no interest in doing that by themselves; they would do it only as part of NATO, the EU or UN.

Professor Smith: Unless one could imagine circumstances in Northern Ireland where there may be a difference between Scottish views and the views of the rest of the UK about what is happening and there is large-scale unrest. It is very hypothetical, but that is probably the only case in which one would think of a Scottish expeditionary force in those sorts of circumstance.

Q2166Lindsay Roy: Professor Chalmers, are you saying that, with regard to protecting our airspace and North sea oil assets, there would be a dependency culture? It would depend on the rest of the UK or some other joint force to support Scotland?

Professor Chalmers: In areas of maritime and air protection, or indeed cyber defences or counter-terrorism, there would be a very strong interest for both Governments to cooperate. Where there were gaps in Scotland’s capabilities, as I am sure there would be for a long transition period, or perhaps permanently, it would be in their interest to call upon the assets of the rest of the UK.

Q2167Lindsay Roy: So there would be the same interdependence as there is just now?

Professor Chalmers: There would still be interdependence. It would take a different form, but there would still be very strong interdependence, yes.

Q2168Mike Freer: GCHQ is the listening post for the UK, but if the Scottish Government had a divergent agenda, they could very easily be cut off from intelligence and have to create their own. What is the ballpark figure to create an independent listening post? Do you have any ideas?

Professor Chalmers: I have no idea at all; it would depend entirely on what the mission was.

Professor Smith: It is not primarily to do with money. You just cannot buy those cryptanalysts, cryptographers and the experience of the whole structure. That is just a vast knowledge base that is shared with NSA and the other groups there. You could spend vast amounts of money, as GCHQ has done, but the crucial thing is not so much the equipment, but the skills involved in it.

Professor Chalmers: You can look at other small European countries that have much more limited capability in this area, which get by. They get by partly by partnership with others, being friendly with others, heeding the wishes of bigger powers with more capabilities, and sometimes by having some degree of specialism so they have something particular to offer. Immediately after independence, Scotland might have very limited capability in this area, but it might build up a particular specialism that it can offer to the rest of the UK and say, "We can do this, but in return we want that." The premise of your question is right. That degree of interdependence in security capabilities will constrain the ability of a Scottish Government to pursue a radically different foreign and security policy agenda, because that could have consequences for the willingness of the rest of the UK to continue with it.

Q2169Mike Freer: A lot of our intelligence is shared with America. The Americans are not particularly happy with the Scottish Government over their release of the Lockerbie bomber. There could be a scenario where the Americans could freeze out intelligence to GCHQ because they do not want it shared with the Scottish Government.

Professor Chalmers: If we got into that scenario, I suspect RUK would choose the American relationship.

Q2170Mr Reid: Say, for example, a group of Scottish citizens were held hostage by terrorists abroad. Would the Scottish Government have any capability to do anything about that if, for example, they were frozen out of intelligence? Even if they had trained special forces, would they have the expensive equipment necessary to get them there, or would they be completely dependent on some bigger power for help?

Professor Smith: They would have just as much capability as the UK did with the Algerian hostages-none. One of the things about scale is important. It would be nice to have small, effective special forces, but the only way you can get them is by recruiting very large numbers of people into the military and choosing the best from all of those. In order to get effective special forces, you need a very large pool from which to recruit, because to get into the SAS and SBS is very competitive. It would be hard to have just good special forces without large amounts of other personnel.

Q2171Iain McKenzie: On the point of what one can and cannot afford, the SNP put forward a motion that it would spend £2.5 billion on defence. Is your interpretation of it that that would include intelligence and counter-cyber security?

Professor Chalmers: I have the resolution in front of me. It talks about an annual defence and security budget of £2.5 billion, so my understanding is that it doesn’t only include defence, but also includes intelligence services. Whether it includes an element for the counterterrorist aspects of the police I do not know.

Q2172Iain McKenzie: Could you put an individual value on counter-terrorism and so on out of that budget of £2.5 billion?

Professor Chalmers: The current UK budget for the security and intelligence services, as I recall, is about £2 billion. As to the Scottish share of that, 8.5% of £2 billion is a little under £200 million. On that basis, which is one basis but not necessarily right, the defence aspect of this might be £2.2 billion or £2.3 billion.

The other thing that is not clear from this resolution is whether this is the budget at today’s prices or what it would be in 2020, in the first year of independence. That makes some difference. Today, it is rather high compared with many other small European countries. If it was the budget for 2020, it would be more or less where Denmark and Norway are today.

Q2173Chair: Before we start to go through the detail, can you give us a view on a couple of points or reflect on them as we go along? One is Trident. You have both mentioned the question of cooperation. We produced a report recently entitled "Days or Decades" along the lines of how quickly Trident could be removed. Is it right for us to assume that, if a separate Scottish Government decided that Trident should be emasculated within days and removed within months, that is not likely to result in the degree of cooperation in other areas that they might wish, or is that likely simply to be seen as an item on its own separated from everything else where normal business could continue? Do you have a view on that?

Professor Smith: Scottish independence is a low-probability event. You have to think about it, but these low-probability events happen. When they happen, like Czechoslovakia or the Soviet Union splitting up, you are working to try to make things up as you go along. That was certainly the case with the successor states that had nuclear weapons. The way it happened with the Soviet Union is that they were just left where they were. Kazakhstan, like Scotland, decided that it did not want to be a nuclear power. How do you get rid of it? Fortunately, in that case there was the Nunn-Lugar threat reduction procedure in which the US provided money essentially to get these weapons under control and make sure that they moved back. Scotland is not Kazakhstan, but there would be a range of similarities in terms of moving these things safely, and there would be very strong incentives both for an independent Scotland and the remainder of the UK to make sure that somebody was looking after those nuclear weapons. The incentives for cooperation and doing it carefully and slowly, making sure it was under control, would be very strong on both sides.

Q2174Chair: Absolutely. Maybe I did not express myself clearly. Undoubtedly, on whatever time scale it takes place, you would want to make sure that the movement of them was done safely and so on. What I was trying to reach you on was this question: if Scotland asked for the nuclear weapons to be removed as soon as possible and disarmed virtually within days, thereby robbing the United Kingdom of its nuclear deterrent, in your view, is that likely to be seen as an isolated issue to be settled on its own, or would it continue over into the attitude that was taken on every other matter dealing with defence? When we are looking at different aspects of this-cooperation, sharing of resources and all the rest of it-should we have that in mind, or can we safely park that to one side?

Professor Smith: I think it will pollute almost everything else because it is such a central issue in the whole area. If one gets an independent Scotland that says it wants their removal immediately, right now, that causes all sorts of problems for the rest of the UK in dealing with it. As to arguments over which assets Scotland might inherit, you would have to sort out Trident before you could start discussing whether they have some Hawks, frigates and so on. It could easily be one of those issues that makes divorces incredibly acrimonious and pollutes the whole structure. That might not happen; they could say, "Let’s do this reasonably." But there is a chance of it becoming very acrimonious over that one issue, and, if we cannot settle that one, everything else, as in the Soviet case, just stands where it falls, and then you could not have any discussions.

Professor Chalmers: Last time I was before you, I may have given evidence on this question. What Ron says is absolutely right. If an independent Scotland was talking about moving UK aircraft, there would not be a problem. If this was an aircraft-based deterrent, it would not be a problem because there are places to move it. It might be seen as rather hostile, but, in the end, London would get over it and might quite like having its own capabilities on its own territory. But, in this particular case, it is very clear that it is not possible in a short time scale to move this capability to an alternative base. Whether it is in the long term we can debate, but certainly in the first decade or so it is not possible. Therefore, this would effectively be the Scottish Government insisting on unilateral nuclear disarmament by the rest of the UK. Ron said it would pollute the relationship. It would bring the independence negotiations to a juddering halt, because a referendum is one thing and separation is another. The time between the two would be very large, and you would get a stand-off. On the Scottish side, you would probably see quite a significant political re-orientation and a dispute between those who thought smooth transition to independence was the most important objective and those who thought rapid de-nuclearisation was. Politicians are probably better at predicting how that would operate in the aftermath of a referendum, but it would be a central issue.

It is also true that, if a Scottish negotiating team after a referendum said, "We are prepared to be flexible on this issue and have Trident remain in Scotland for a long period of time"-as the Ukraine and Ireland did in their independence negotiations-"but, in return, we want London to accept the result of the referendum, negotiate a smooth transition and have other degrees of interdependence in the conventional area," London could not very well say, "We are going to play very hard ball on other issues," if Scotland was giving ground on this issue, given the views of the SNP on the presence of Trident in Scotland. In a strange sort of way, both sides would probably be doomed to cooperate. The Trident issue is a source of potential dissension, but also a symbol of the interdependence in the security area that the two sides, however much they would have disagreed in the referendum campaign, might be forced into. If they did come to an agreement on continuing Trident basing, that would have a spill-over into the conventional field too.

Q2175Chair: In many ways possibly we have got you in too early, because our Trident report "Days or Decades" has been sent to the Scottish Government. They have promised to give us a reply. Their line on whether or not it is going to be done quickly or over a long period with collaboration will help a lot of other issues fall into place, but we have not got that yet; indeed, we might not get it until November or so. We have to proceed on the assumption that we will receive it on the basis of the information we have.

The second point I want to raise and ask you to reflect on as we go through is one that you have already touched on to some extent, and that is precedents elsewhere. We are aware to some extent of the Czechs and Slovaks and break-up of the former Soviet Union. Nobody has mentioned to us before the Irish parallel, but I can see the question of harbours and so on as one from which we can draw. If there are any others as we go through that you think are appropriate, it would be similarly helpful to draw them to our attention.

The SNP’s motion, including the figure it gave, said it was more than the level of defence spending by the UK Government at the present time in Scotland. Is it sensible to look at levels of defence spending being allocated by region and say that Scotland ought to get x, Wales ought to get y and Yorkshire ought to get such and such, or does it make sense to say, "It’s allocated according to who are the best suppliers and, if you do not have the industrial base or technology for this, it goes somewhere else."? Is that a reasonable way of looking at things?

Professor Smith: It is also the fact that we just do not know where it is spent. The Ministry of Defence stopped publishing those numbers because they were terrible numbers. If there is a contract with BAE, it will be a contract with BAE; it will not be a contract necessarily for Govan or a particular place. The whole system is so interdependent that it is very hard to track down regionally. Some of it you can. We do not know whether the £2.5 billion will be more or less than is spent in Scotland at the moment; there is real uncertainty about it.

Q2176Chair: Leaving aside the difficulties of establishing the figures, is it a figure that is a meaningful one that we ought to seek to use? Should it be an aspiration for Scots that we get our fair share of defence spending, or should we say, "The objective is that the UK is adequately defended, and, therefore, we want to make sure that the money is spent properly, wherever the location is."?

Professor Smith: I would take the second position, but often that is not the way politicians see it. When I have given evidence on these sorts of thing, quite often people have been focused on the employment effects, particularly when I say that it would be much more efficient if we imported it. Politically, you should think about what is the most efficient way to defend the country. In the US, they know where everything is spent. Because lobbying through US Congress is so important, the defence manufacturers record every constituency in which they spend their money. Because of the lobbying, they appreciate that.

Q2177Chair: Presumably, it would be cheaper for us to import professors of applied economics as well.

Professor Smith: Indeed.

Q2178Chair: You are not necessarily advocating that at the moment, though, are you?

Professor Chalmers: We do.

Professor Smith: I am almost the only English person in my department. I am sorry; I am almost the only British person.

Q2179Chair: So we do do that already?

Professor Smith: We do that.

Q2180Lindsay Roy: But where the money is spent, though, does not tell us where the assets are deployed. For example, there may be more frigates off the west coast of Scotland than you might expect compared with the spend.

Professor Smith: Indeed.

Q2181Lindsay Roy: The same with the Air Force?

Professor Smith: Yes. That would go back to the issues of air defence. It is going to be very hard to defend Scotland separately from the rest of the United Kingdom because of the area you intend to control.

Q2182Chair: Malcolm, do you want to touch on any of these points about the allocation of expenditure or the historical parallels at the moment?

Professor Chalmers: I agree with what Ron said in terms of this rather artificial figure of spending in Scotland. The other significant thing is the proportion of the current UK defence budget that they are proposing would be spent by Scotland, so the £2.3 billion compared with 8.5% of £38 billion is a relevant comparison.

Q2183Lindsay Roy: Professor Chalmers, you said that there was a very high amount of spend on personnel as opposed to equipment in the proposed budget, yet the SNP motion indicates that they are going to include fast jets. For such high-value items, how many would be required to be effective? Would it be a squadron of fast jets?

Professor Chalmers: It is a very reasonable question. You cannot answer that question in relation to a particular item of equipment because they could always focus their equipment spending primarily on fast jets and get a couple of squadrons, or whatever it might be. It would depend on which jets you are talking about, how capable they are and so on. It is clear that, if the SNP figures for personnel and spending are compatible with each other, it means they are spending a lower proportion of their budget on equipment than the UK, and that has implications both for start-up costs and/or what they would inherit, but it also has implications for how much they can spend maintaining equipment.

Q2184Lindsay Roy: For example, can you give us an idea of how much it would cost for a squadron of Tornados or Typhoons and their maintenance and upkeep? Is it multi-millions of pounds?

Professor Chalmers: It is. Again, it depends on how ready you want to keep them. I am sorry to complexify it, but, on the basis of discussions with people in our MOD, if you compare how much we spend for each of our available aircraft with what some other European countries-Italy or Spain-spend on each of their aircraft, we will spend a lot more because we have higher standards of readiness. The Scots could maintain at low levels of readiness what appears to be quite a number of fast jets; they just would not spend much time on training their pilots, for example.

Q2185Chair: By definition, there is not much point in having fast jets at a low state of readiness, is there?

Professor Chalmers: That may well be true, but a lot of countries do it.

Professor Smith: In the first Gulf war, the UK found that a lot of its tanks did not work. There is a paper order of battle; a large number of things are there on the books. The number actually working and usable is much smaller, so it is having a virtual air force. My guess is that they would not be able to afford Typhoons or Tornados. We would probably be talking about second-hand F-16s or Hawks.

Professor Chalmers: We come back to what Ron said right at the beginning about the culture that the new armed forces would have. To the extent that you inherited lots of RAF fast-jet pilots or a dozen RAF fast-jet pilots who wanted to replicate the RAF in Scotland, that would certainly not be affordable. But, if you got a senior officer from an air force of a country with as little money as Scotland would have to spend on defence, they might find ways of maintaining an air force that was much less capable, but comparable with the norm of small European countries.

Q2186Chair: When we visited Leuchars, I was quite surprised by the low number of jets actually available. I had not really appreciated how much downtime they spend. Say you have F-16s or Hawks, which are medium macho-fast jets as distinct from really macho-fast jets. Can you give us an idea of how many it might be necessary to have to allow for a rolling programme of repair? If I remember correctly, either a third or a quarter of the planes that they had at Leuchars were available at any one time. To cover that size of water that Scotland has round about it, what sort of numbers are we talking about? Is it 21 of which seven are available at any time, or are seven not enough?

Professor Smith: You need more.

Chair: I genuinely have no idea, and that is why we are looking for guidance from you.

Q2187Lindsay Roy: A squadron is 12.

Professor Chalmers: It can be, yes.

Lindsay Roy: The squadrons at Leuchars are 12.

Q2188Chair: If a third of them are available at any one time, that is four. Are four sufficient?

Professor Smith: No. You have to bring in accidents, and also the numbers depend on how much you fly them. An easy way of having them available is not to fly them very much. You have 24, and they are maintained and ready in case the Russian Bear arrives, or something like that. That economises tremendously. The downside is that your pilots do not get any training. There is a real issue on the hours. Very often, you economise by reducing flying time; that reduces maintenance and a lot of other costs. It means they are available and it looks good, but your pilots are just not experienced enough and they do not have that regular maintenance. Those are the hard choices. Carrying over the UK attitudes, the UK is really bad at those hard choices, in the sense that the criticism is that you have defence forces as an insurance policy. The UK is happy to pay for a third-party, fire and theft insurance policy, but treats it like fully comprehensive. This is a criticism that has just been made by Stanley McChrystal, the American general. You try to do too much with what is there. When you get a small budget like that, which an independent Scotland would have, those hard choices are even harder.

There is a temptation to adopt what is called in the trade a conspiracy of optimism and say, "It will all work out okay. Maybe we will be able to afford that." That is where the transition will be really hard. Hawks that are used offensively are configured rather differently from those used primarily as trainers. They are designed so that they carry missiles and things like that, but you would want to reconfigure them. You may say, "That’s too expensive; let’s buy some old F-16s at £10 million each," or something like that-£250 million would get you a squadron. You have got only £2.5 billion to play with, so you are buying stuff out of a tiny budget. The UK has this problem. As Trident goes through, or as Typhoon went through, there was just no money spare, because you had a large procurement programme that was doing that. Since the Scots will have all the wrong sort of kit for what they want to do, they will have to spend a lot to procure. You can just see the eyes of the arms dealers of the world light up.

Q2189Lindsay Roy: The SNP have said they will have their own fast jets?

Professor Smith: Yes.

Q2190Lindsay Roy: Are there any other assets that would be required to sustain a squadron of fast jets that they do not have at the moment? For example, we were told that refuelling was from tankers based at Brize Norton.

Professor Smith: If they are going to be used primarily around Scotland, you would not need air-to-air refuelling. You might be able to do a deal with the UK, but you would be limited to where they were using them. You tend to think of these things as an aircraft: an F-16, Hawk or something like that. That is quite a small part of the cost. It depends on what sort of avionics, radar and missiles have gone in. That is why very often they cover a whole range of variants, depending on the capability of it. Then you need the training sites in order to get the whole thing through. The infrastructure is probably five times the purchase cost in order to keep the whole structure going. When we sell to Saudi Arabia, we make all our money not on these things, but all the bits that go with them.

Q2191Lindsay Roy: The hard question is, within the budget proposal we have heard, is having a squadron of fast jets viable?

Professor Smith: Not unless they take the ones from the UK.

Q2192Lindsay Roy: The almost obsolete?

Professor Smith: A lot of the planes are very old. The B-52s that the US are using date from the 1950s. It is not so much the platform that is the issue, but the avionics, missiles and all the rest of it.

Q2193Lindsay Roy: To take you to another aspect, is a squadron of six Chinooks or Hercules viable?

Professor Chalmers: In every one of these cases it is viable if you are prepared to give it a high enough priority. The challenge is to look at the whole package. You can get your couple of squadrons of fast jets at a reasonable level of readiness, but maybe you cannot afford the Chinooks as well, or you can get the Chinooks, but you cannot afford a couple of diesel electric submarines, or whatever it might be. You have to look at the total. I think a small number of Chinooks would be possible.

Q2194Lindsay Roy: Would you accept that this has not been worked out by the SNP in the statement that they put forward?

Professor Chalmers: The statement certainly does not go into this in detail, no.

Professor Smith: There is a temptation to say, "Yes, we can afford to buy just the Chinooks or the Hercules," but there are big fixed costs and specialised maintenance for the Hercules and Chinooks, unless you are going to subcontract it somewhere else.

Q2195Chair: Are there any parallels elsewhere on which we can draw where somebody has Hercules or Chinooks and a third party does it for them?

Professor Smith: Yes.

Q2196Chair: Who does that apply to?

Professor Smith: You send them back to the US.

Q2197Chair: Presumably, the US would not have people on the ground. You send them back there for main refurb, as it were?

Professor Smith: In general, yes, you would send the aircraft back. Malcolm’s point is that aircraft are different from other things because you can move them around very easily. It would be the same way as the Trident missiles go back to the US for their servicing.

Q2198Chair: That is feasible? To have Chinooks and Hercules, you would not necessarily have your own maintenance? You would have to have a running programme for tyres and things like that, but you would not necessarily need to have the big maintenance?

Professor Smith: The big maintenance could go back to the US.

Q2199Chair: We spoke about fast jets. Is the Hawk counted as a fast jet? It depends on how fast is "fast". In terms of what Scotland might inherit, leaving aside the F-16s, which would have to be bought, if some Hawks were inherited, presumably there is no capital cost because you then get some as part of the divvy-up?

Professor Smith: Essentially, all they are going to be used for, in the same way as the UK ones, is that every time an old Russian Bear comes round you get a photo opportunity of having your own aircraft there. The Typhoon is rushed up as soon as possible so it can be photographed in action. There is not a major air threat at the moment.

Q2200Chair: In that case, if you redefine Hawks as fast jets, it is possible to have a fast-jet force that is perfectly adequate. When we think of fast jets, we think of zoomy Tornados, Typhoons and all the rest of it, but you are saying to us that that is far more expensive than Scotland needs or can afford.

Professor Smith: And a lot of the countries that use Hawks as combat aircraft use them in that way.

Q2201Chair: But in terms of the threat from the Russians, with Bears coming over, Hawks are perfectly adequate, are they?

Professor Smith: Yes; it is an old propeller aircraft.

Q2202Chair: You tell me; I don’t know. Malcolm, you look sceptical about that.

Professor Chalmers: It depends on what you see as a threat. If the challenge is to be able to be seen to be monitoring Russian behaviour and to send an aircraft up to track it, that is one thing. If there was a serious military threat by Russia to Scotland, that is when NATO comes in, because Scotland as a member of NATO would call on the assets of others in that scenario. Clearly, there is no scenario, no matter how much Scotland spends, in which it could withstand Russian military might by itself.

Professor Smith: That is true of all the little countries-Norway, Denmark and so on.

Q2203Chair: That raises the issue about whether or not Scotland is in NATO with nuclear weapons and all the rest of it, but in terms of an air force of some Hawks, with numbers and readiness undetermined, it would be adequate? In those circumstances, with repairs being done elsewhere for Chinooks and Hercules, that structure is entirely possible. There is then the issue of how much all that costs and how much it impinges on everything else, but that element of it is not unreasonably expensive for a small country?

Professor Chalmers: No.

Professor Smith: No.

Lindsay Roy: And jobs.

Chair: And jobs, as Lindsay said.

Chair:

Q2204Iain McKenzie: On our visit to Leuchars, we heard from the people who flew these planes their concern about speed of interception, but they were also concerned about the on-board radar capabilities of Hawk jets. They see them as quite inferior to the Tornados and so on. Is another issue that, even if you scramble them and get them up, tracking what they are meant to be escorting would be much more difficult or, indeed, maybe impossible?

Professor Smith: You would depend on ground radar instead of having radar in the aircraft that would automatically direct the missiles.

Q2205Iain McKenzie: Would that be additional? Would you need to have radar stations throughout Scotland to facilitate this?

Professor Smith: As part of the air traffic control system you would have radar systems there anyway.

Q2206Iain McKenzie: Would that be sufficient coverage across Scotland? What is there at present? Would there be areas of radar blackout, if you like? Would they be escorting the Russian Bear and all of a sudden they can’t really do radar tracking?

Professor Chalmers: That is entirely possible. I do not have the level of technical expertise to comment on the particular capabilities of radar in that respect, but that would be a risk you would be taking if there were no RAF planes to take on this task.

Q2207Iain McKenzie: Are there other issues you would need to take on board to resolve it and so on?

Professor Chalmers: It would throw up the issue of the relationship with the Air Force of the RUK. There would probably be quite a strong incentive in some areas of Scottish capability to have various back-up, but also perhaps some RAF continuing presence in Scotland.

Q2208Iain McKenzie: We also heard about continuity of handover. If, for instance, another member of NATO was escorting a Russian aircraft from their airspace, there would be a handover, and they would like to see the same level of equipment in the aircraft they are handing over to rather than an inferior aircraft.

Professor Smith: Take the position of Ireland. Ireland has no fast jets, so it would just coordinate in terms of radar and notify the RAF in those sorts of ways. Iceland has no military forces at all. It did have this massive NATO base in the country, which has now been turned into a shopping centre. It has the problem of what to do about the Russian Bears as they come over. Largely, they just ignore them.

Q2209Chair: Generally, the Bears are not after Iceland, are they, and therefore it is not unreasonable for Iceland not to worry?

Professor Smith: In strategic terms, Iceland is in a much greater strategic position than Scotland both with respect to the Arctic and US-Russian interactions. Iceland is tiny. Scotland is a large place compared with Iceland.

Professor Chalmers: If the UK continues to have Trident submarines in Scotland for an extended period of time, the RUK would want to make sure it could monitor any threats to that base, and that would include air threats as well as naval ones. That would give RUK an interest in ensuring the viability of Scotland’s air defences. Whether they would be prepared to rely on the Scottish air force to patrol Scottish airspace as long as Faslane was still there is, I suspect, problematic.

Q2210Chair: If there was an agreement to keep Trident there for 20 to 25 years until a replacement was built, there is no reason why that sort of arrangement could not be extended to air cover, and it then allows many of these transitional issues to be overcome.

Professor Chalmers: Absolutely.

Q2211Chair: On the other hand, if Trident is thrown out at a moment’s notice, you can imagine somebody just pulling the plug.

Professor Chalmers: I think that is right.

Chair: Can we turn now to questions relating to the Army?

Q2212Pamela Nash: For lay people like me, it is easy to see where the money goes in the Air Force and the Navy with big-ticket items being purchased and maintained, but maybe it is a little more difficult in terms of the Army. I would guess that most of the running costs are people costs-manpower costs on salaries, benefits and training. Can you confirm whether or not that is the case? What other major expenditures are there for the Army?

Professor Smith: That is the point Malcolm made. If you have an army-centric defence policy, then, in the jargon, it is less capital-intensive; you have less equipment, so more expenditure goes on personnel than on equipment. Traditionally, the Army has had less equipment relative to the Navy and Air Force, and it has also been squeezed on equipment. There has been a UK programme to get us armoured vehicles, which has been running for years and years. When we really needed armoured vehicles in Iraq and Afghanistan, we just had to go out and buy them very quickly.

Then the issue would be, what would this Scottish army be used for? It seems kind of large, unless you are expecting a lot of trouble in Scotland. Then you say, what would it be used for? You are then talking about contributing to peace-keeping activities, and you are back to the points Malcolm was making about logistics as to how you move them there, keep them supplied and those sorts of thing. Primarily, armoured vehicles, communications equipment plus artillery, some of which they may inherit, would be the main pieces of equipment involved.

Professor Chalmers: That is absolutely right. I suspect one of the areas the Scots would not want to get into is attack helicopters, which are an exception to the rule in the Army and are very expensive. The maintenance costs are very considerable indeed. In that respect, it is more like the Air Force. I suspect they would not want to get into having even a small number of Apaches because that would be unaffordable. For most of the rest of the force structure, I think that is right. The equipment often lasts a long time. Almost every European country has some basic army and armoured warfare capability, so that would be affordable.

Q2213Pamela Nash: You said the helicopters would be unaffordable.

Professor Chalmers: In terms of attack helicopters.

Q2214Pamela Nash: But would they not be necessary for a Scottish defence force? What is the point of a Scottish army if it does not have this equipment?

Professor Smith: Attack helicopters fall into the same sort of category as fast jets. Essentially, they are aggressive weapons, so most countries that would be doing peace-keeping types of thing would not have that sort or equipment. They would be very expensive. They would certainly need helicopters more generally, but on a number of these issues the question is whether you do it as part of the military or whether you have them outside the military. For instance, search and rescue in the UK is being privatised and moved to a non-military activity. Whether one regards the coastguard as a military or non-military activity is a fine judgment, but the question of what you would be doing with your army would determine what sort of equipment it would have beyond the basics of communications and mobility.

Q2215Pamela Nash: Do you think that the budget the SNP have set out in their paper would be for the number of staff that we are talking about here? I am not just thinking of the armed forces, but their support staff. One of the figures that we were given in evidence previously was that it would take up to 10 support and admin staff in the background to put one soldier into the field. Is that a figure you recognise? Would you put it as high as that?

Professor Chalmers: That might be true if you are talking about Helmand, where you have an enormous logistical churn. A very large proportion of British service personnel never get outside Bastion. You have a lot of people deployed there, and even a large number of contractors and civilians out there, who are not "in the field".

Q2216Pamela Nash: Just to be clear, I don’t mean staff who are necessarily outside Scotland, so you would have administrative and support staff in Scotland.

Professor Chalmers: Yes, of course; you would have.

Q2217Pamela Nash: Would that figure be 10 to one in Scotland?

Professor Chalmers: It would not be 10 to one in terms of service to nonservice. Quite a lot of service personnel perform very important support roles, so they are not front line as such at any one time, or indeed sometimes ever. I think that is right. If you look at the figure of 15,000 regular and 5,000 reserve, those are not all front-line forces, but neither is the British Army’s 82,000, which we are heading towards, front-line forces either. In answer to your first point-whether the personnel and spending figures are compatible-my previous answer was that they are compatible only with a much more personnel-intensive force posture, and they exclude start-up costs. The issue of start-up costs, which is related to how you divide up the assets, has to be answered separately, but, if you put that issue to one side for a moment, these two figures are potentially compatible.

Q2218Pamela Nash: You say they are potentially compatible, but is there a point to it? You could employ that number of soldiers in your army, and support staff and reserve personnel, but would there be a point to that other than maintaining the figures?

Professor Chalmers: That is a very good question. Still, too often this debate is conducted in terms of both the employment issues, which are valid, but also in terms of what you inherit, rather than putting yourself in the mind of a Scottish Government planner in 2020 in an independent Scotland and saying, "Looking at all the other priorities the Scottish Government have, with a tight budget, what do they need defence forces for?" They do not need them for the same reasons the UK have them because those are quite different.

You would look at a range of possible threats. Terrorism and cyber warfare would still be threats, but what about participating in expeditionary operations in Africa? You would probably want to do a bit in terms of political solidarity, but that might well be handled by a relatively small infantry capability. You come up with a quite different force structure. My contention would be that it would be rather less army-centric and rather more about flexible capabilities for doing things in the immediate neighbourhood of Scotland.

Q2219Chair: Unless I am mistaken, what you are really saying is that the ideal force structure for a separate Scotland would not have the number of soldiers that could be nominally attributed to Scotland at the moment. The assumption has been that the Scottish regiments come home, and that is where you start from and that is what you have got.

Professor Chalmers: Yes.

Q2220Chair: Whereas you are saying, as I understand it, that a sensible structure for a separate Scottish defence force would have many fewer soldiers than that. That would be the way to go and you spend your other money, as Professor Smith said, on an air force and a navy, which is what the physical positioning of Scotland would tend to need.

Professor Chalmers: I do not think it is sensible to start a debate on what defence forces an independent Scotland would need from the national attribution of units within the UK Army. It is much better to start from an analysis of what would be in Scotland’s interests. My view is that that would lead to a significant reduction in the number of personnel that we currently have nominally attributed to Scottish regiments, not all of whom, of course, are Scots.

Q2221Chair: I believe that a number of them are Fijians, but, to be fair, there are also lots of Scots in other regiments.

Professor Chalmers: However one defines "Scots", by the way.

Q2222Chair: With respect, we spent a long time rambling on about whether or not Sir Alec Ferguson is entitled to vote in the referendum, so we have covered much of that. Can I come back to the regular regiments and battalions in the British Army just now and those that could initially be allocated to Scotland? We have the figures: 1 Scots, 2 Scots, 3 Scots, 4 Scots, 5 Scots, and then 1st Battalion Scots Guards, the Royal Scots Dragoon Guards and the Royal Artillery-the Highland Gunners-as eight regiments. That is where the SNP’s analysis has come from. We work on the basis that that is transferred over.

When we were discussing the percentage of front-line people as compared with support units, I was not clear whether or not that is an entirely skewed distribution. Unless I am mistaken, in there we do not have military police, logistics and all the rest of it. I am not clear about the extent to which these units have these services within them already, or, if all these regiments were transferred, you would have to break them up to set up signals and what have you, or you would have to establish completely separate units in addition to these, which would take the numbers up even higher. Can you give us some guidance on any of that? Unfortunately, the reporter does not record sighs and shakes of the head, so possibly you need to spell it out for us.

Professor Smith: The basic problem is that in the past Scotland has been a very good place to recruit infantrymen. We have a lot of very effective Scottish regiments. One of the real problems of UK defence policy has been how to handle regiments. It is a very tribal culture; it is very much part of the tradition, and it makes it really hard to move people around and do various things. At each stage of the evolution of the British Army it is said, "Let’s try to get rid of these regiments." There would be a tremendous outcry and then they would maintain these names to a certain extent.

The problem of UK defence policy is that heritage has weighed down so heavily on it. For Scottish defence policy it is exactly the same. Keeping the Scottish regiments has been a big political issue, so where does our defence policy start? It starts with the Scottish regiments, but that is not having eight infantry regiments. There will be some integral stuff, but there is a lot of REME-type stuff and logistics, which would not be integral to those regiments and which you would need to provide separately, but you would still have a very large group of infantry relative to the defence policy.

Q2223Chair: It is a large group of infantry, but larger, in a sense, past their other allocation. You have five infantry regiments. The Scots Guards are infantry as well, aren’t they? That is six infantry, and then you have got one tank and one artillery regiment. You then have all these other people to be added on to that, unless you have to shut down some of the Scottish regiments, in which case even the figure of 15,000 might be an underestimate if you start from the perspective that you have to keep all these regiments and add bits on to them.

Professor Chalmers: That is making the assumption that the role of these regiments in a Scottish army would be the same as it is in the British Army. There is a lot of room for creativity, and we have seen a lot already in recent British history in terms of rebadging and reroling. I am not trying to write the SNP’s policy for them, but you could imagine in this event that capabilities that have never belonged to some Scottish names suddenly take on quite a different role in artillery, logistics or whatever it might be.

Q2224Chair: Infantry units could be re-roled entirely within that framework?

Professor Chalmers: As something quite different.

Q2225Chair: Again, it comes back to what our role is in the sense of asking the SNP in particular, or those who are arguing for change, to explain what the change would be in order that people in Scotland will have an understanding of the choices.

Professor Chalmers: A good question would be, "Are you simply maintaining the names or would you also maintain the existing roles?"

Q2226Chair: Is it fair to assume that, if this number of infantry regiments and so on were transferred over without these other units being established, either separately or by reroling, effectively you will just have a gigantic tattoo, in the sense that you will have people able to march, parade and so on, but there is nothing for them to do in a military sense because they do not have the support units, and it is going to be almost entirely a parade-ground army? Is that a fair way of looking at it?

Professor Smith: Again, it depends on what you are going to do with them. A whole range of support units would depend on where they are going and what they are being used for in those sorts of ways.

Q2227Chair: With this format they are not going anywhere.

Professor Smith: They do not need a lot of support if they are not going anywhere.

Q2228Chair: That would be a way of achieving this.

Professor Smith: Yes.

Q2229Chair: Therefore, constant parades in Scotland would be a way of fulfilling a function with this force, but this force would not be able to do anything else without having somebody else providing all the other things. It comes back to dependency. It would be almost entirely dependent on other people providing everything else, unless they established additional units or reroled the ones we have here. Is that a fair way of putting it?

Professor Chalmers: That is not entirely fair. There would be a significant degree of dependence, more than the UK has, but you could still afford other elements that would give you autonomy. For example, we talked about Chinooks earlier. In terms of tactical transport around the theatre, you could have a significant amount of capability, which would be enough for a deployment of some small proportion of your infantry. The question would be, if you have a large infantry component in your Scottish army, can you deploy all of it? It is not that you cannot deploy any of it with your own support, but are there scenarios in which you would want to deploy a large part of it, or, effectively, would most of it be at a pretty low level of readiness?

Q2230Chair: It comes back to the question of balance. You could potentially end up with some people, yes, being deployable-

Professor Chalmers: Most not.

Chair: But most of them would never be deployable. You have more than you could possibly deploy because you simply have more infantry than you need.

Professor Chalmers: Yes, because you have an unbalanced force. I think that is a real risk.

Chair: Okay, I think that is clear.

Q2231Iain McKenzie: What I am taking from this is that, ideally, you would have a defence policy and then match it with the requirements for equipment, manpower and so on, but my understanding is that that is not what is going to happen. You will have a Government approaching another Government and saying, "Give us our share," so that share will then have to be matched or a defence policy created through what you receive. It is actually going in the other direction.

Professor Chalmers: I do not think any of us knows what is going to happen, but in the scenario of a yes vote and the beginning of negotiations about divvying up assets, the UK MOD objective in that divvying up will be to keep almost everything it has got already, because it is constructed on a unitary basis. The UK’s strategic needs will not be substantially reduced by separation, so they will want to keep almost all of it.

Q2232Iain McKenzie: Taking the nuclear component aside, they would say, "Yes, you can keep that," but for the rest-

Professor Chalmers: It is the carriers, destroyers and new frigates; you go across the piece. The UK has quite low levels of capability, but very high-end capability in many cases, and Scotland probably will not be interested in it. I suspect that, in that negotiation, you will get a question about whether the Scottish negotiators would prefer to take the cash rather than the assets, particularly if there might be other areas in which the financial trade-off went in another direction. Certainly, from a military planning point of view, a Scottish Government might well see advantage in taking the cash in a division of assets and using that to buy kit or infrastructure more suitable to Scotland’s needs rather than, as we talked about earlier, taking-

Q2233Iain McKenzie: Would the rest of the UK see that as an advantage, though, just to hand over cash rather than-

Professor Chalmers: There might be a difference between the MOD and Treasury on that. I suspect the MOD would like to keep as many of its current assets as it could. There may be some exceptions; maybe they could do without a few infantry regiments, but, generally speaking, they would want to keep most of their assets because the RUK’s main defence objective will be to persuade others that it is no less of a power than it is at present so it will not want to give up key things. The Scottish MOD might well go along with that. The UK Treasury might have another point of view.

Q2234Chair: Presumably, the whole issue of cash allocation will be overshadowed by the costs of rebuilding facilities for Trident elsewhere, and who pays for these? If the person who is throwing them out then becomes liable for the replacement, that will overshadow almost everything else and there will be no surplus cash available, or, if assets are allocated according to cost of construction, the UK will be able to say that Scotland has got all the value of the nuclear submarine base at Coulport and so on and, therefore, is not due to have anything else transferred, so it has inherited those sunk costs. I would like it to be recorded that the witnesses "um’d", "ah’d" and generally nodded in approval.

Professor Chalmers: We can talk as well.

Chair: You can talk as well, but you have not up to now. That is why I just thought I would make sure I got that on the record.

Q2235Iain McKenzie: If someone with a large amount of cash is looking for equipment, would we not see the prices significantly inflated? There would be an armaments industry out there that knows you want something that they have, and, by the way, the price is now so much.

Professor Chalmers: I do not think that would be the case.

Q2236Iain McKenzie: Would you get less for your money?

Professor Chalmers: Scotland’s total demand for arms in the context of today’s global arms market would still be very small. You could negotiate keen prices.

To come back to the issue of Trident compensation, the Chair is right. If there were a scenario in which Scotland asked for Trident to be kicked out pretty quickly, or even over 10 or 15 years, and that meant substantial extra cost, RUK could quite legitimately in that negotiation say, "Look, you’ve got to pay for that." That would be added to the general equation. It depends on the numbers, but it could offset the fact that Scotland was taking a smaller share of total defence assets.

Q2237Chair: To come back to the point I made earlier about precedent elsewhere, what happened with the allocation of military units between, say, the Czechs and Slovaks and when the USSR broke up? Presumably, there must have been lots of Russian sailors furth of Russia and army units based here, there and everywhere else. How was all that handled?

Professor Smith: The Czech-Slovak one was two thirds/one third; they split everything between the two of them. For the Soviet one, primarily it stayed where it was, in particular with agreements for the Crimea and the naval bases and maintaining those arrangements, which were very similar to those negotiated with Ireland when it seceded. There were quite strong reasons for Russia to want to reduce the size of its forces. This had been a big battle within the Soviet system. They had vast conscription. They were very personnel heavy, so the internal battle will say that the end of the Soviet Union could be a way to try to reorganise, reform and get more professional armed forces within the Russian structure. That did not happen. It was very slow. The fact that they won the war against Georgia just showed how bad a lot of the structures were.

You could see that happening under particular sorts of Government in the UK, saying, "Scottish independence gives us an opportunity to rethink our role in the world. Maybe we do not want to be a nuclear power, and this gives us a good excuse to get out. We can’t really afford this." You could imagine an austerity-minded Chancellor and Treasury being absolutely delighted at the opportunities that may come in that sort of way.

Going back to the question, in principle, what are the security threats and what are the capabilities that you need to meet them? How do you fund those capabilities? You could imagine the Scottish Government saying, "Really, there are no threats. There is a little bit of fishery protection, particularly if we are out of the EU and have to make sure the Spanish fishermen don’t get in, some basic gendarmerie and paramilitary policing to handle football riots and that’ll do it."

Mr Reid: Political dissenters.

Q2238Chair: You have got an enthusiasm for this civil disturbance, haven’t you? Have you ever been to Glasgow?

Professor Smith: I have, but not recently. It has improved a lot since I was last there.

Professor Chalmers: It is a very peaceful city, Ron.

Professor Smith: But the ultimate responsibility of the military is aid to the civil power to maintain order. That has to be there, but it can be provided in other ways.

Q2239Chair: I do understand that. Can I come back to the allocation of regiments and so on in the Soviet forces? I genuinely do not know whether or not there was the equivalent-Ukrainian regiments that might have been physically based somewhere else. Were they swapped over at that stage? If there were Ukrainians in a regiment in Kazakhstan, did they swap personnel? You said that things just stayed where they were.

Professor Chalmers: Ron knows about the personnel, but the equipment was certainly inherited by whichever country had it on its territory.

Q2240Chair: You can see how Czech and Slovak units might have been misallocated. People wanting to choose nationalities and so on might want to move. Is there a precedent there at all?

Professor Smith: In the Soviet case, because they had a two-year conscription, it ended very quickly, so they would be carrying over the officer corps, which tends to stay with the countries concerned.

Q2241Chair: Was that the same for the Czechs and Slovaks?

Professor Chalmers: I don’t know. They certainly had conscription. Not everybody is a conscript.

Q2242Pamela Nash: Before we move on, I have one more question on the Army related to training. You mentioned the considerable start-up costs that you were not sure had been thought through by the SNP when they produced this document. How much of that would you say would be training facilities, and what are your thoughts on what the Scottish Government could purchase? What training could be purchased from the residual UK, for instance? What training could continue to be carried out here, and what would have to be done by the home country?

Professor Chalmers: Unless there was a crash programme of building facilities, which would be expensive, there would be a long transition period. It would raise issues for Scotland about whether the training was appropriate for the very different position they were in. A lot of training would be in common, and for that they would be reliant on RUK for a significant period of time.

Chair: That is right, because I think we were told that all the infantry training presently takes place at Catterick. Therefore, it would either have to be built from scratch or they would have to replicate somewhere in downtown Glasgow, possibly, to cover your obsession with civil unrest.

Q2243Pamela Nash: To be clear, even if there was a long transition period, would that training, including officer training, have to be brought into Scotland?

Professor Chalmers: There would be a lot of pressure to do more and more of it at home for economic and all sorts of other reasons. It would not be cost-effective to do all your training across the border.

Q2244Pamela Nash: I know that other countries already pay the UK for officer training.

Professor Chalmers: Yes, but they do not train all their officers in the UK; they train some of them for some of their education. I am sure that Scotland, like every other NATO country, would want to send people to other NATO countries for part of their training.

Q2245Pamela Nash: At some point there would be a need for that training?

Professor Chalmers: Yes, for general training, absolutely.

Q2246Pamela Nash: It is not foreseeable that they would always pay the rest of the UK to do it; they would have to do it at some point?

Professor Chalmers: They would, I think; it would be desirable to do so.

Professor Smith: The training for which foreign countries send people to the Defence Academy here tends to be very general. The staff college is looking at general political things like that. The very specific tactical training would have to be Scottish-specific in the light of what the threats and roles were.

Pamela Nash: As the Chair said.

Professor Smith: Yes.

Professor Chalmers: And the equipment Scotland has, because, over time, the equipment the Scots had and the British had would diverge more and more, and you would have to have different training as a result.

Q2247Jim McGovern: I realise, Professor Smith and Professor Chalmers, that you prefer to deal in hard facts, but you have also very kindly offered us opinions at times. The question I am going to ask is to get an opinion rather than a statement of fact. The last review of the regiments, which obviously included the Scottish ones, led to the Black Watch becoming the 3rd Battalion of the Royal Regiment of Scotland. The SNP said at the time that, in a separate Scotland under them, the regiments would be restored. In the motion at their recent conference, they reiterated that regular ground forces would include current Scottish-raised and restored UK regiments. Do you think that is feasible?

Professor Smith: It is feasible at a cost, but it is not sensible. That is the point.

Q2248Jim McGovern: What sort of cost?

Professor Smith: Essentially, it is the cost of their salaries and some overheads. Again, these numbers are army-centric. You are not providing them with a lot of equipment, but you have a lot of bodies and are paying their salaries. The issue is that it would not match Scotland’s security needs.

Q2249Jim McGovern: In your opinion, it does not stand up to scrutiny?

Professor Smith: Purely in my opinion, yes.

Q2250Jim McGovern: What about yourself, Professor Chalmers?

Professor Chalmers: I agree with Ron on that.

Q2251Chair: Those are very easy answers. It is not a very easy answer to give.

Professor Smith: It is very rare to hear two economists agree with each other.

Chair: Indeed; let’s move on quickly then.

Q2252Mr Reid: If we turn to the Navy and start with submarines, the SNP motion said that an independent Scotland would need to address the lack of conventional submarines. What role do you think conventional submarines would have in a Scottish navy?

Professor Smith: I cannot see the function of conventional submarines in a Scottish navy, but that, again, is purely an opinion.

Mr Reid: That is perfectly clear. Professor Chalmers?

Professor Chalmers: What is interesting about the SNP statement is that it did not say they would acquire conventional submarines straight away. They said that a Scottish defence industrial strategy and procurement plan would have to address the lack of new frigates, conventional submarines and maritime patrol aircraft. Conventional submarines might be a useful asset, depending on how significant a role Scotland wanted to play in the north Atlantic, perhaps rather further from its shores, contributing to collective security in the high north or the approaches to the Arctic. That would be quite an ambitious direction in which to go and would require more defence spending, but some of the things SNP spokesmen have said suggest that they do want something that is more oriented towards cooperation with Norway and Denmark and contributes to what they do in that area. It is certainly not out of the question in terms of affordability, but Ron is right that there would have to be a question about exactly what it was for.

Q2253Mr Reid: What purpose do you think that they could serve?

Professor Chalmers: Depending on their particular capabilities, they could be used for surveillance or tracking of potentially hostile surface ships, or the insertion of special forces-all sorts of things.

Q2254Mr Reid: But could you not do that more cheaply from the air or by satellites?

Professor Chalmers: Aircraft can be detected in some circumstances, whereas submarines cannot.

Q2255Mr Reid: Yes, but, if you are only tracking, does it matter if the person you are tracking knows that you are tracking them?

Professor Chalmers: I am not saying that submarines are the answer, but I can see that submarines have some capabilities that aircraft do not have. If you want to give a high priority to maritime capabilities in the north of Scotland and the north Atlantic, quite a number of other countries have such capabilities. Scotland might decide it wanted it. It would not be a cheap capability, but it is not entirely unaffordable.

Q2256Mr Reid: How many submarines, for example, do you think would be needed to be an effective fleet?

Professor Chalmers: Of the order of three or four.

Q2257Mr Reid: Is that affordable for a Scottish defence budget?

Professor Smith: If you bought them abroad. What is worrying is that that is in the context of the defence industrial policy, which suggests that it is motivated by keeping the shipyards working. In the past, the UK produced some conventional submarines-the Upholder class-and they were an absolute disaster, so we stopped. Submarine-building skills are very specific, and, again, there are problems with Astute. It seems to me that the political drive is to find something for those shipyards to do.

Q2258Mr Reid: Do you have at the tip of your fingers any idea of the costs of constructing, say, three or four submarines at a Scottish shipyard?

Professor Smith: The difficulty is that, if you make guesses about what it would cost based on what you are buying and you produce them yourself, it is five or 10 times that. That is the experience we have had with Nimrod and Astute, so developing and producing yourselves is incredibly expensive.

Professor Chalmers: Especially developing it.

Q2259Mr Reid: Could you buy an on-the-shelf design?

Professor Chalmers: The middle ground might be to produce a German submarine under licence. There would always be a temptation for the procurement authority to try to mess around with the design, which will always push up the cost enormously. If you go down a pure licence production route, then I guess it would be a bit cheaper but still more expensive than buying it off the shelf from Germany, or buying a second-hand submarine from somebody.

Q2260Lindsay Roy: Is there a potential function to protect North sea oil assets?

Professor Smith: It depends on what would be attacking the North sea oil assets. It would probably be quite expensive to maintain conventional submarines on patrol over that sort of range. You would probably need more than four of them if you were to have constant coverage of all the North sea oil assets. I would have thought that air would be a more effective way.

Professor Smith: And special forces.

Q2261Lindsay Roy: In your view, submarines would just be status symbols?

Professor Smith: Yes. I cannot see their military function. Malcolm has given some possible reasons.

Q2262Chair: My understanding is that, to have one Trident at sea all the time, you need four. Is that because they have nuclear weapons on them, or is that just the standard for submarines? If you always want to have one at sea, even if it is a conventional submarine, is it a fair assumption that you have to have four and a Scottish navy with four submarines would have only one at sea at any one time?

Professor Smith: The maintenance requirements on conventional submarines are a lot less than for nuclear submarines. Even for Trident you need only three; four is an insurance policy in case there is an accident, or we run into a French nuclear submarine or something like that.

Chair: Or they run into us.

Professor Smith: You could do it with three so that one of them is having a major upgrade at a particular time. I am outside my technical knowledge, but I think it may not be as great with conventional submarines.

Chair: We will check that. We know there are regions that have six submarines, so presumably that means that, potentially, there are two at sea at any one time.

Q2263Iain McKenzie: You mentioned briefly that, in addition to requiring submarines and so on for patrolling the North sea and the oil assets, elite forces may be required to work in conjunction with protecting these assets. Can you put any sort of price on how much it would cost to have elite forces, how many would be involved in that and the size of the elite force that would need to be maintained?

Professor Smith: The difficulty is the point I made earlier. To get those elite forces, you need a very big pool from which to select the best. Before getting into the SAS, somebody would have been in a standard regiment and then gone on a competition. A very large proportion of people who applied would be rejected. Then they would have the training. The question is whether you could maintain forces of that calibre without a larger pool of infantry.

Q2264Chair: The New Zealanders have special forces.

Professor Smith: Yes, they do.

Q2265Chair: They do not have as many infantry as the Scots are proposing to have.

Professor Chalmers: You are not talking about large numbers; you might be talking about a couple of hundred, but you have people for counter-terrorism, which is absolutely very important. You can imagine all sorts of terrorist scenarios in relation to oil rigs in which you need very agile and capable special forces, but you do not need large numbers of them to respond to what would be, in the end, pretty small incidents.

Q2266Mr Reid: Let’s go up to the surface now. On the assumption that the Royal Navy was divided out pro rata to Scotland’s population vis-à-vis the rest of the United Kingdom, how much could the Scottish navy expect in terms of frigates and patrol boats to start off with?

Professor Chalmers: The answer is that I would not start from there.

Mr Reid: The problem is that we are.

Professor Chalmers: It comes back to what I said earlier about financial compensation being more likely. If you did-well, how many do we have now? Is it 18 or 20?

Professor Smith: As at 2012, we had 13 frigates.

Professor Chalmers: With 13 frigates, I guess Scotland would get one.

Q2267Mr Reid: Is that enough to patrol our coasts or do we need to acquire more?

Professor Chalmers: I do not think you would want to have them.

Q2268Mr Reid: You would not want any at all?

Professor Chalmers: The Royal Navy has made a choice over the years to focus on quality rather than quantity and to have capabilities that are globally deployable. One of the problems we have with things like counter-piracy is that, because we have so few numbers, we are using 200-million-pound ships to confront a few pirates with Kalashnikovs. Scotland might well end up inheriting one frigate, but that would not be the centrepiece of its navy in terms of what it had to confront; it would have to have a significant number of other smaller vessels, I would suggest.

Q2269Mr Reid: You would advise that in the negotiations they should not acquire any of these frigates, but get some sort of cash settlement.

Professor Chalmers: And then buying what they think is needed.

Q2270Mr Reid: Would it be buy or build?

Professor Smith: Buy. It is the same issue again. Building is going to be a lot more expensive than buying. A lot of the Royal Navy’s ships-tankers and replenishment vessels-all go with this blue-water Navy. They need to be fairly solid because they have to deal with the north Atlantic, but more corvettes, big patrol boats, which is what most other countries have, would be a lot cheaper, because what makes the frigates expensive are the sea equivalents of avionics, the missile systems and all the rest of it. It would be a much simpler patrol boat-a corvette type of thing-which would be there primarily for fishery protection, protection of North sea oil and occasional issues to do with piracy and terrorism.

Professor Chalmers: For the rest of the Navy it is even more true. The Type 45 air defence destroyers are very sophisticated and expensive ships, and all the submarines are nuclear-powered. What are these Royal Navy assets? There would be some mine-countermeasure vehicles perhaps.

Q2271Chair: Presumably, the Type 23 could be reactivated or refurbed. I remember that Type 23s were refurbed for Chile and a couple of Type 22s were revamped for Romania, so you do not necessarily require the sophistication that the Royal Navy would have.

Professor Chalmers: That is true.

Q2272Chair: This is where you would have separation of the Royal Navy from the Scottish navy. Any old stuff refurbed could sail about the North sea and up to the north of Scotland fairly easily.

Professor Chalmers: That is a credible scenario in which the Royal Navy, as it replaced its Type 23 to Type 26, could give or sell its Type 23s to Scotland.

Q2273Chair: In the reallocation of assets, the oldest and least qualified stuff where the equipment, electronics and so on maybe are outdated will be perfectly adequate for almost any scenario you are likely to encounter. I would have thought that that is quite possible.

Professor Chalmers: That is possible.

Q2274Chair: I am not clear about the functions that would be carried out by submarines as compared with those carried out by frigates. Obviously, one does it under the water and the other on the surface. I understand that distinction. In terms of showing a presence and being able to cover ground or water, they are almost interchangeable, are they not? You would not have the same need for submarines if you did not have a couple of frigates. Is that a fair analysis, or do the submarines have a completely different role that would not be overcome or rendered unnecessary by the presence of a couple of frigates?

Professor Smith: If you have a fleet, submarines are quite effective at protecting it, but we do not imagine the Scottish fleet going off doing that. If you want to deliver special forces into hostile areas, submarines are very effective at doing that, but, again, it is unlikely that the Scots would be doing that. As for patrolling particular areas in the Arctic without being seen, submarines can do that. Their advantage is stealth. I am just not clear why Scotland would require that.

Professor Chalmers: For me, that question would come down to the issue of the alliance relationships Scotland was seeking to form-not just in general terms about being a member of NATO, but also whether it felt it had to make a contribution to the security of the countries to which it was closest in northern Europe. Norway and Denmark do have these capabilities. It is possible that the Scots might say, "We can’t be entirely free-riders; we want to make a contribution. This is where we are in the north Atlantic. There is a worsening problem in the Arctic, so we’ll make a contribution to what our neighbours do." It would be mainly about national and NATO responsibility and not free-riding.

Q2275Chair: But, in a sense, the argument would be that that is not something that would be necessary immediately. Once everything else has settled down and you have sorted out everything else, then you start thinking about going forward. That may be in 2030, or something like that. Once you have overcome all the transitional things, you then think about expanding your role.

Professor Chalmers: On the basis of a threat assessment at the time. Yes, I think that is right.

Chair: That is helpful.

Q2276Mr Reid: In terms of the basic functions of coastal defence, fishery and oil rig protection, how many of these revamped frigates would you think Scotland should acquire?

Professor Chalmers: I don’t think I would go down the route of revamped frigates, even if they are less advanced in their radar.

Q2277Mr Reid: Would that be a cheaper solution than buying them?

Professor Chalmers: You would go for offshore patrol vessels and corvettes, as Ron said, if it is basically for that. Even other European countries with some high-end frigates do not have anything like the frigates we have got. Often, they are things inherited from the cold war, and we are not talking about Scotland going head to head with the Soviet Union.

Q2278Mr Reid: Have you any idea of how many you would advise the Scottish navy to acquire?

Professor Smith: A dozen patrol boat-type vessels.

Q2279Iain McKenzie: Would it still be the case that you would go out and purchase those rather than build them? Would it stretch your budget that bit further if you purchased them from elsewhere rather than built those vessels?

Professor Smith: Again, it is this really hard choice. From my point of view as an economist, it is cheaper for you to buy them from abroad, but for a Scottish politician with shipyards that are not doing something, the temptation is to say they will be Scottish corvettes.

Q2280Mr Reid: Say all that that shipyard was doing was building for the Scottish navy because it is no longer able to get Royal Navy contracts, and let’s assume it fails to compete internationally and the only customer it has is the Scottish navy. Would a dozen patrol boats be enough to keep a shipyard viable?

Professor Smith: You would not want to build them all at once; you would build them one at a time.

Q2281Mr Reid: Have you any idea, roughly, how many people that would keep in a job, if that was your programme?

Professor Smith: It is a lot less than we are talking about at the moment.

Mr Reid: I will accept "a lot less".

Chair: Speaking as a Member representing Govan shipyards, when people are not being kept in order by troops from elsewhere, the shipyards are looking for the possibility of a couple of patrol boat vessel orders just to fill in a gap for a period of six months to a year. They would just chew them up. At the end of that period you are left with the same problem you had at the beginning; you have nothing to build. All you have done is simply postpone the collapse. Unless the shipyards get Royal Navy orders, they are essentially doomed. I would refer you to our recent report on exactly that subject.

Q2282Mr Reid: In terms of maintenance, at the moment you have Faslane, Coulport and Rosyth. How much work do you think these dozen patrol boats would provide for those places, compared with the work they have at the moment?

Professor Smith: A lot less.

Mr Reid: A lot less.

Q2283Chair: Can you see any way in which Faslane could be staffed at its present complement, which is 6,700 and is scheduled to go up to 8,200 with the submarines? The Royal Navy has told us that, if Trident were removed, it would be one out, all out. All the submarines will go and all the Royal Navy vessels will go; they are not just leaving some because they want to have a submarine centre of excellence with supporting vessels. If you then had to provide 6,500 jobs, possibly with a couple of frigates and some patrol vessels, what else would you need to be moving in there? Would you be able to reopen Rosyth as a naval base as well if you had Faslane at 6,500? I think it would be better if you said something, even if you disagree.

Professor Chalmers: I am just looking at the SNP statement, which talks about having a joint forces headquarters based at Faslane. Clearly, it is not only about the navy; it is across all the services. It also talks about a total complement of 15,000 regulars. I cannot imagine that 5,000 of those 15,000 would all be based at Faslane, so the service number would come down significantly. In terms of the navy specifically, we are talking about a much smaller navy, probably of the order of a couple of thousand. If all of those 2,000 were based at Faslane and we had some headquarters people on top, you might have 3,000, but you certainly would not have the numbers you have now.

Professor Smith: I agree with that.

Q2284Chair: To what extent is it sensible to have any of the Scottish navy based at Faslane given that it is in the south-western quadrant of the country? If you think particularly of the bottom of Argyll, it is literally at the very south-west of the country, yet the naval threat and maritime area of interest is in the north and east. Is that rational? I am not quite clear whether or not the most important thing in basing a navy is the facilities you have actually got on site or proximity to where you want to be. What is the balance in these circumstances?

Professor Smith: Proximity would be very important. You would need basing on the east coast for oil installation-type roles. You may have two bases, but basing it all at Faslane would not seem sensible. As Malcolm said, there will be other nonnaval facilities according to the SNP proposal. It would be the army-I am not sure about the air force perhaps-but it would not be just the navy.

Professor Chalmers: You would need to distinguish between immediate steps, which might well take advantage of assets already there, and medium and longer-term plans. It would be one thing to say, "We’ve got this building or base here and we’ll use it for now." It would be another to spend more money on that facility when you had a choice of doing it elsewhere. Ron is absolutely right on the second one. Even if they use Faslane in the short term, the strategic rationale would mean they would not want to pour more money into a place that was not as appropriate as the east coast.

Q2285Chair: In these circumstances, would it make sense for Rosyth on the east coast to be reopened as a naval facility, or are there any other locations of which you are aware that might be more suitable? There is Scapa Flow. I am not quite sure what criteria might be utilised. Scapa Flow in many ways would be seen to be ideal to cover the north and east, wouldn’t it?

Professor Smith: Certainly, smaller patrol boats of the corvette-type size do not need facilities as complicated as would be required for the nuclear submarines, frigates or destroyers. You could put up relatively cheap bases.

Q2286Chair: You say "bases". Would you not normally have all these at the one location? Are there not economies of scale by having all your corvettes together, or does that not matter? Could you have a couple in Rosyth, a couple in Aberdeen and a couple somewhere else, or would that be disproportionately expensive? I am not clear.

Professor Chalmers: I do not know the answer to that. I think there would be issues in both directions. The shorter the range of the systems, the more dispersed they would have to be. If you want to cover a large area of coastline, you cannot do that from one place unless you have longer patrol times. On the other hand, in terms of maintenance and so on, it would make more sense to be in one place, so you would have balancing criteria.

Professor Smith: You could have routine maintenance done in a smaller place and then they would go back to somewhere like Faslane or Rosyth for major work.

Q2287Chair: If you had the patrol boats or even the frigates in Rosyth or dispersed on the east coast, presumably that would further reduce the number of jobs in Faslane and would make it even more difficult, if not impossible, to maintain Faslane at the existing level of personnel?

Professor Chalmers: That is clearly the case.

Professor Smith: Yes.

Q2288Iain McKenzie: You touched upon the sharing of headquarters at Faslane. What would that entail? What would be in those headquarters? Would that make a significant saving in the defence budget overall?

Professor Smith: Rosyth is a duplication. The Scottish military have to establish a new headquarters for the essential things that the Ministry of Defence does in particular areas, but how extensive it is would depend very much on the threat assessment and what you are expecting to do with it. UK headquarters are there ready to be moved out somewhere in order to organise a peace-keeping action or something like that. The scale of the headquarters would depend on what was expected to be done.

Professor Chalmers: There would be an issue about whether you want the force headquarters to be a significant travelling distance from your political headquarters, because you will have to have some sort of Ministry of Defence, I imagine, in the capital, in Edinburgh. Some might say that having a joint force headquarters in or near Edinburgh might make more sense, so there could be some issues around that.

Q2289Lindsay Roy: You spoke earlier about transitional costs. What do you think the main transitional costs would be if Scotland became independent?

Professor Chalmers: There would be several big issues. One would be the establishment of secure command and control for your forces, which would be linked in to the political leadership in Scotland to allow them to communicate with all the different units of the Scottish defence force. How big that is would depend on how big the forces are. I am not sure how much of that you could inherit because a lot of it is not needed at present. That is something new. As to the headquarters, no doubt you could get buildings, but you have to furbish them with all the specific military requirements in terms of security, communications and so on, so that would be expensive.

We have talked already about equipment to some extent and the balance of inheritance and buying. A significant amount would have to be bought. That could be phased in over a period of time. Nevertheless, that would be a significant start-up cost. When we compare Scotland with Denmark, Norway or whatever, those countries have built up their military capability over decades. You would not be able to obtain a military capability comparable to theirs straight away. It is not only a matter of equipment; it is also a personnel matter. Maybe I have missed other things.

Professor Smith: The personnel issues are about getting all the military command structure and the civil servants to operate and how you would fit it in, because people currently serving in the British military, who would want to serve in the Scottish military if it was organised on a friendly basis, may not be the ones you want. You may have too many of one speciality and too few of another. Getting that transition is very hard.

Q2290Lindsay Roy: Transition not handled on the basis of good will would leave vulnerability?

Professor Smith: Because it is so integrated, any way you cut it up will leave both the rest of the UK and Scotland vulnerable to particular sorts of threat. You can say there are not any big threats at the moment, so it is not a big problem, but those potential vulnerabilities are certainly there when you try to take apart an integrated system.

Q2291Lindsay Roy: Professor Chalmers, you said you felt that the rest of the UK would want to keep most of the assets. What are the big asset issues as far as the new Scottish armed forces are concerned? What do you think they would want in particular?

Professor Chalmers: I do not think that is very clear, apart from the issue of the Scottish-badged units in the Army and their associated equipment, where clearly there is a political imperative, even if there is not a very strong security imperative in that regard. With that exception, I am struggling to think of many other areas in which there is a strong security imperative to have particular assets, which was why I said earlier that the dynamic would be one in which RUK would want to keep almost everything and the Scots might prefer to get the cash.

Q2292Chair: Can I come back to the question of establishing the headquarters? Surely, there is a general officer commanding Scotland at the moment. Presumably, he has all this communication equipment to be able to communicate with whoever it is he communicates with. There is a structure there of sorts, is there not, so all the framework for that is in place? The only missing link is direct to the politicians, but, presumably, that does not necessarily need to be a man wandering around behind the First Minister with a button, does it? It is not quite of that nature. Therefore, I do not see that there are all that many setup costs there.

Professor Smith: I am not sure of the extent to which the GOC Scotland would be integrated with the Air Force and naval capabilities in terms of that structure. With most of these communication systems, it is a matter of trying to take out one bit. The system depends on all the linkages in that sort of way. If it went on being part of the UK system, I do not think there would be any real problems, but taking out a bit is more difficult than it sounds in many cases.

Q2293Chair: Do we know what happened with the Czechs and Slovaks, or the USSR?

Professor Smith: I do not know. I think they spent quite a lot on developing separate systems.

Professor Chalmers: The Soviet military capability declined radically at the time of dissolution. It was not just because budgets were being cut, but because it pulled apart a pretty integrated system. Most of the Soviets’ advanced ground equipment was nearest NATO in Ukraine and Belarus. They lost most of their good tanks and they were left with the much older tanks in Russia. This is a very different scenario. Yes, there would be some infrastructure, but it would have to be reconfigured for a different scenario.

Q2294Chair: I had not quite understood that point about tanks. I had assumed you were talking about things being left where they were such as military bases and air fields, which were immovable.

Professor Chalmers: The tanks as well.

Q2295Chair: I had not thought of things like tanks being left. Under that scenario, parts of the Royal Regiment of Scotland that are in Germany would be left there, and the barracks in England would be left there. Presumably, it is not going to be quite like that. I find it very difficult to believe that nothing was moved when the Soviet Union split up.

Professor Smith: That was the issue with the nuclear warheads.

Q2296Chair: I can see it at that level of sophistication.

Professor Smith: They were pretty much the only things that were moved.

Professor Chalmers: The Russians got most of the T-54s and T-55s, but Ukraine and Belarus got most of the T-80s. I heard an interesting report-I cannot testify to its veracity-that immediately before the last referendum in Quebec the Canadians moved some of their aircraft to the United States for a training exercise.

Q2297Chair: I met a delegation of Canadians the other day. If only I had known that, I could have raised it with them. I remember from my days as a Strathclyde regional councillor that, at the end of Strathclyde, there was what was described as a disaggregation of Strathclyde region. If you were disaggregated to Argyll, it was not seen as a positive career move. There are obviously those issues there as well.

We are just about coming to the end of the points. The only issue we still want to touch on is procurement, joint procurement and so on. In the SNP motion there is the assumption that everything will carry on regardless. We have been looking at a report recently on separation of the shipyards. We were discussing article 346 about procurement and so on in the EU. The SNP make the assumption that procurement will just go on pretty much as it does now. I understand the bit about not buying from Scotland alone. On the question of cooperation and procurement, presumably, the small party will be entirely dependent upon the big party in these circumstances to decide whether or not it wants to cooperate, and all the bargaining leverage will be with the UK and almost none with Scotland. Is that correct, or am I missing a point here?

Professor Smith: If you think of co-operative procurement in the case of the F-35s where we are cooperating with the United States in procuring them, we have very little influence. We just have to go along with what they say. If Scotland went along with the UK in joint procurements, my guess is that Scotland would have very little influence. But, going back, I do not think Scotland would want the same things as the UK, so joint procurement would not be a good thing. The UK has never bought corvettes, which might be a very sensible thing for Scotland to have, in which case it will have to procure them itself. There is the danger of having a UK mindset of saying that Scotland and the UK will go on wanting the same sort of thing, whereas there will be quite different defence and force structures.

Professor Chalmers: That is right. If you look at UK MOD attitudes towards joint procurement now with European partners, there is real sensitivity to the big transaction costs involved in working with others. That is one of the reasons there is quite a focus on working with France because their needs are closer to ours in terms of their expeditionary capability and also their budget. It is worth the savings you get to co-operate with somebody who is more or less your equal. But, if you are trying to co-operate with somebody with very different requirements who is much smaller, the transaction costs are much more likely to exceed any potential economic benefits from a UK point of view. The conclusion from that is that, yes, of course, Scotland might be able to buy some of what the UK is producing anyway off the end of the production line, but it is much less likely to be able to get involved from the start because the numbers just would not add up; there would be too much disproportion.

Q2298Chair: The concept of joint procurement was being used to defend the presence of things like SELEX Galileo in Scotland, on the grounds that they would be selling to the UK. We were discussing with people whether or not the equipment that SELEX Galileo was producing in Edinburgh at the moment was going into anything that, then, Scotland would buy. It turned out that these were very fast jets and generally were so high-tech that they were not something that a nation like Scotland, which should have ambitions appropriate to its size, would want to have. Are there any areas where you think that joint procurement might be a way forward? Presumably, there are low-tech things like vehicles.

Professor Smith: If they wanted Hercules or Chinooks, a joint buy on those would be sensible in those circumstances, because they are things that both Scotland and the UK are likely to have. With basic armoured vehicles, that would be the case. A joint buy is easier than a joint procurement, because if you are buying a Chinook or Hercules you know what you are buying. If you are buying a new armoured vehicle that is going to be developed in the rest of the UK, you are completely dependent on what the Ministry of Defence eventually decides it wants, and it will change its mind as it goes through. At the beginning you say, "This is what we want." On the F-35, at one stage it looked like the short take-off vertical landing version would be cancelled. We were at that stage completely dependent, and are again, on the production of that. Joint buys of something that is out there already are useful; joint procurement and development is much more difficult.

Professor Chalmers: On the logistics and equipment support side, in principle, one could envisage a situation in which the RUK continued to support it from facilities in Scotland, just as Scotland supported most of its equipment from facilities in England. In principle, you could envisage that. Whether that would be viable in the long term-no doubt it would happen in the short term-would depend on whether the RUK was confident of security of supply. You could not have a situation in which, in any future operation that London was part of but the Scots did not agree with, the Scots were saying, "We’re not prepared to provide servicing for these UK Chinook helicopters, which are taking part in a war with which we do not agree." There would have to be assurances of that sort, so the more there were foreign policy diversions between the two countries, the less co-operation in logistics would be possible.

Q2299Chair: The question of joint basing is an even more extreme example of that. You could not possibly have a situation where you have two Governments controlling whether or not planes can fly off from a particular airfield. The Scottish Government would have a veto over UK aircraft flying from Scottish soil if it was something they did not like. Is that a reasonable supposition?

Professor Chalmers: Since there would also be RAF bases in England, I suppose they could simply take off from Scotland and land in England first, but, if there were to be RUK conventional bases in Scotland after independence, there would have to be clear agreement about whether Scotland had any say about how those could be used.

Q2300Chair: It is almost like the base in Akrotiri in Cyprus; it would have to be almost UK sovereign territory to make sure that they had complete control over it.

Professor Chalmers: That would be one solution. There are other solutions to it. If you are talking about expeditionary warfare a long way from Europe, then you are not talking about flying directly from Scotland anyway. You could, for example, have an assurance that, as long as they are based in Scotland, the Scottish Government have to have transparency about what they are doing, an agreement about their roles and so on. For the vast majority of what they do up there, that should not be controversial. If the UK Government wanted to re-task them for something with which Scotland did not agree, they would have to move them to England first. You can think about all sorts of scenarios, but that would have to be sorted out.

Q2301Chair: It is highly unlikely that any UK Government would want to have to go through the rigmarole of getting agreement from a Scottish Government to re-task something, particularly if it was urgent.

Professor Chalmers: I agree. That would be one of the problems.

Q2302Chair: In those circumstances, it is highly unlikely to envisage circumstances, other than in a transitional period, where a UK Government would want to have assets in Scotland that at any stage might be subject to a veto by the Scottish Government?

Professor Chalmers: In that scenario the UK would be balancing two things-on the one hand, total freedom of action in relation to operations with which Scotland might well not agree. That part of the equation would depend on how far there was convergence. It is possible that an independent Scotland would have a general attitude towards NATO and security policy not that different from London. There would be that on the one hand. The other part of the equation would be whether there would be operational advantages to continuing basing in Scotland. For example, for air and maritime patrol there might be operational and cost advantages in continuing some presence in Scotland. The trend over time would be for a diminution-a downsizing-of a remaining conventional presence in Scotland by RUK, but if the two countries managed to reach agreement on a whole range of security issues it might not be a very rapid process.

Q2303Chair: That reminds me that, when we were discussing basing advantages, we asked how long it would take a jet to fly from Marham in East Anglia, say, up to Leuchars. We got the reply back from the MOD that it depended on how fast it went, which was not untrue, but was not necessarily as helpful as it might have been.

Those are all the questions that we have. As I indicated to you before, at the end we ask you whether or not there are any answers you have prepared for questions that we have not asked, or anything you feel we have not touched on that you want to leave with us before you go.

Professor Smith: No.

Professor Chalmers: I think that has been very comprehensive, Chair, so the answer is no.

Chair: If anything occurs to you subsequently, where you wish you had said such and such, by all means put it in writing to us. Thank you very much for coming along.

Prepared 1st February 2013