Contribution
My Lords, I strongly support the purpose of opposing Clause 38 standing part. The PAC’s 43rd report of 2024-25 heavily criticised the MoD for inadequacies in its financial oversight of the RFCAs. The report said:
“The Department’s arrangements for monitoring and reporting on the RFCAs’ financial performance are inadequate”
and they
“fall below the standard we expect”.
I have studied this report. It is quite a shocker. The PAC even said that there was uncertainty over who was responsible when problems arise. I could go on, but I will spare officials their blushes. I hope they are preparing the progress reports that the PAC demanded, covering these shortfalls and failings.
The PAC specifically acknowledged that the Reserve Forces and cadets are increasingly important to UK defence, as is stressed in the SDR. But to take these shortcomings as specific reasons for changes, not just to financial control but to the management, structure and leadership of the RFCAs, is simply an overreaction. The drafters of this aspect of the Bill seem to ignore history or have little feeling for the long tradition of the Armed Forces’ loyalty and direct connection with the Crown—a tradition that goes back centuries, as mentioned, to Henry VIII and beyond. Such history is binding for the Armed Forces. It should never, even inadvertently, be disparaged or discarded.
Let us recall what Dr Sullivan’s review recommended. He sought to retain the regional volunteer networks, employer engagement and community links that make RFCAs so valuable, while strengthening the strategic direction, financial resilience and oversight. His broader message was to ensure that RFCAs remain a modern, effective and trusted partner for defence, while expanding their contribution to reserves, cadets, employers, veterans and the volunteer estate. What, then, are their particular strengths? I will me pick briefly on two.
First, the RFCAs’ unique voluntary nature, apart from their nil personnel cost, is the essence of the regional and collective support that they bring to the reserves and cadets. Their local, intimate knowledge of employers and of the attractions and enthusiasms of their locality are such a foundational success of the cadet concept that inspires young of different ages, sexes and backgrounds to join up and get involved. Their national coverage is a key defence requirement. All this should be valued and sustained, not badly revamped or even discarded.
There does not appear to be strong evidence of widespread problems in recruiting RFCA volunteers—particularly cadet force adult volunteers, where some regions have reported growth. The direct relationship between lords-lieutenant, personally chosen and appointed by the sovereign, and the cadets in their counties symbolises the expectation of the reserves’ and cadets’ loyalty to their monarch, who is their commander-in-chief. Why discard this without even consulting the lords-lieutenant or His Majesty the King? I subscribe to that old-fashioned notion: “If it ain’t broke, why fix it?”
Are the identified MoD failures in financial supervision to be laid entirely at the feet of the RFCA structures? The National Audit Office, in commenting on the financial weaknesses, suggested that arrangements other than a full-blown NDPB would be acceptable. The MoD’s own internal record, following consideration of Dr Sullivan’s report, seemed to indicate that the NDPB approach had been overtaken by the SDR and the key efforts to enhance the reserves’ and cadets’ contribution to overall defence needs. I strongly recommend that the Minister takes this back to his department, checks that the present financial oversight has been improved following the PAC criticisms and gives credit where credit is due to the volunteer strengths of the present structures, as well as to the importance of the symbolic relationship with the lord-lieutenant and the reserves’ and cadets’ loyalty to the Crown.
The Bill is mistaken to degrade or throw away such key elements of a long-established volunteer structure. To throw it away in hasty pursuit of progress, modernisation, accountability and transparency—or any other overworked nostrum of management speak—is pure madness. Of course, the MoD should heed the PAC’s criticism of its lack of proper financial management and ensure that the MoD’s accounting officer has regained the financial oversight expected by the PAC, but the MoD’s financial failings are no reason to discard the tried-and-tested experience that makes the reserves and cadets, with their supporting volunteer associations, of increasing value to both defence and society at large.