>> again, the real concerns. i share the concerns. i am the biggest one you will find for increasing access to pell grants. with health care reform, we have $40 billion of pell grants. it's the biggest since the gi bills. it's one of the things i'm most proud of. in an ideal world, we wouldn't have made that recommendation. at a time of budget pressure, we made the tough decision to really fight to maintain current levels of pell grant funding and not see the 5550 cutback. we made the tough decision to maintain the programs for every student to scale back on a twice a year program. at the community college level the 5550 means whether you are 18, 48 or 68, you can go to community college for free. we think it's so important.

we want to invest $2 billion in community colleges. as families get back on their feet, it's going to be a huge vehicle to do that. it's not like making a decision we wanted to make or made lightly, we are just facing tremendous budget pressure and made a tough decision. >> i ran around my district for weeks and went through the community colleges. the students, not just the administrators are aware of the proposed cutbacks. very concerned about fy '11 and what it's going to do. the summer pell grants, the year round pell grant program, i can't reiterate strongly enough, the testimonials i have heard from students and administrators and teachers and how important that is. if we are trying to increase the

size of the middle class and have more productive citizens. i think that -- at least i hope you will reconsider that cut. >> i share your concern. >> the gentleman's time expired. mr. thompson. >> thank you mr. chairman. >> thank you secretary. it's good to see you. i appreciate your testimony. out of all the pages, the small section on technical training as we talked about in the past, it's an area, i think, that is an area, there's nothing more important to the competitiveness of the work force. i think really, it's proven its salt in terms of outcomes. it's appropriate. i follow my good friend from iowa. i had the chance to spend a period of time with four

impressive young people or persons from iowa who are involved in career and technical education from different fields. they shared with me some data that showed what those students in career and technical education how they outperformed and it's limited to that situation and how they outperformed in math and science because of the value of applied education. it really was apparent -- i just -- in america's competitivene competitiveness, with the retirement of baby boomers. it's a bit of a mixed message in your testimony. we are on the same page with technical education. harvard's pathway to prosperity, you said for too long, it's been a neglected stepchild of education reform.

that neglect has to stop. we need to reimagine and make it urgent. there's an enormous overlooked program in school systems and ability to prosper as a nation. i think your remarks were brilliant. >> i stole them from you. >> yeah. what i wanted to come to, i agree with your setments and i serve as co-chair. i think it really has proven its results and training in a qualified work force for a small federal investment. it's specifically in education. despite that, the statesmen, the statement you made, the budget request and your testimony, you know, you affirm your support for it. frankly, the budget request for ct, or ct programs over 20%.

just two questions. how do you expect schools to offer more ct programs that we need with purer resources. >> it's a great question. leadership in these areas is important to me. i'll give you one more stat that was interesting. we tracked the data of students in ct programs and they had higher graduation rates and higher gpa. it wasn't just about that course. it was engaging them in different ways in the broader school invirnment that was very, very positive. i will say that the results for cta across the country are mixed. there's amazing programs creating real jobs and others that are -- it's a substantial investment. we challenged the sector where

things aren't working we have to do things differently. we have to get better results. pockets of excellence but that hasn't always been the norm. they haven't leading to the results we need. >> how do we do that? >> learn from what is working. we need greater attention to outcomes. there's too many places saying we offered this class. what does that mean? what is it leading to? we don't always get great answers. by replicating, it gives us the room to invest more going forward. >> i yield back. >> thank you. >> thank you mr. chairman. hello mr. secretary. just as there's a growing bipartisan or consensus over the problem, i think there's a growing consensus of supporting

education. it's not just educators who know this, but scientists, economists and business leaders. the l.a. chamber of commerce. the military telling us this is important. we heard from the republican witness dr. ed hatcher, the you want of the louden county public schools. when asked about the most important innovation we can make to improve outcomes and you have had a lot of questions he repried pre-k, pre-k, pre-k. obviously, i am very pleased there's 350 million in the early learning challenge fund. this is one of the new programs we are pursuing as we focus on using scarce dollars for things

that work. can you highlight the research on the quality early learning? >> we don't need another study. the most recent one i saw was from vanderbilt university. there have been dozens of hundreds of studies to demonstrate it here. what we are trying to do with early learning challenge fund is race to the top of early childhood. increase access to disadvantaged children. we know quality can be uneven. this is glorified child care. it concerns me you have many governors scaling back or cutting back on early childhood programs. i met with the governors and said i recognize it's tough times. i don't think it's a place to cut back. you have to continue to invest.

three to four-year-old's can't lobby. we reduced the investments at a great cost long-term. to congressman hunter's point on reallocating resources, use our dollars during tough budget times to maintain full day high quality early childhood programs. that flexibility already exists. a lot of new governors don't understand that. be creative. that should be one of the last things you cut, not one of the first. >> i couldn't agree with you more. it's time we all recognize every dollar we spend on quality, i always use that adjective, quality, in front of early learning. every dollar we spend comes back to us many times full, up to $17 worth. for those of us who, all the

business people here talking about cause and effect of the dollars spent, this is the one area where there's so much research, i say get on with it. i'm glad the president's budget reflects that. since i -- do i have more time? yes. the issue of effective teaching, because that teacher standing in front of the classroom is the single most person standing there. does your budget reflect an emphasis on encouraging the states to really, the focus on appropriate measures of effectiveness? >> that's an area that for the country for far too long didn't move. we have states with laws on the books that prohibited teachers and students. it's backwards. there's a remarkable outburst and there's no one district that got it right, but many are breaking through. you have to evaluate teachers. you can never look at one test

score. look at multiple things. student achievement and gains have to be a significant part of that. this conference to be held in denver around the country, labor and management. we had fascinating conversations of what folks are doing. it's a country, we are in an infancy. we are putting resources behind it. we are seeing folks who thought of the issues coming together and i think it's going to help strengthen the profession in an important way. >> so the president's budget reflects support for this kind of effort going on all across the country? >> investments not just for teachers themselves but the systems that help teachers be successful. move toward higher standards. it's something teachers are looking for. they have been crying out for that for a long time. creating the infrastructure to

allow them to be very, very successful. massive investments there. >> thank you. i yield back. >> thank the gentle lady. doctor. >> thank you. i want to start out with commenting on recent comments that were made about fairness in the u.s. tax code even though it's not a tax code discussion. i want to clarify that i guess my definition of fairness isn't the same as what's described when 45% of the american people don't pay any income tax at all. the top tax bracts are paying 35% of their income and the top are paying 70% of all income tax. i disagree with that definition of fairness and i want to clarify that in the context of

budg budg budg budgetary. the epa, this is a different direction than what has been taken so far. they have five education efforts in their recent congressional document talking about support and work and partnership with k-12 schools. federal and state agencies to establish priorities and leverage resources. lastly, an effort to increase promotion of green principles and increase the nation's scientific education. i would like to know if the department of education has been involved in those efforts through the e prngs a because it seems they should be talked about in education, not through epa. >> we had a good partnership with administrator jackson and i know they are doing tough and important work in the new york city school system now.

your basic point about collaborating and sharing resources, i couldn't agree with more. where we can have students and districts focus on these issues, do them in a thoughtful way and creative way. the knowledge for students, the savings of districts. they are all up signs. we need to continue to collaborate. yes, sir. >> i guess my concern is that, you know, there appears to be an educational political agenda through epa to, i wouldn't call it indoctrinate but would you consider green principles as something we should be doing at the k-12 level when there's broad difference of opinion on this subject? >> i don't know if i call it political activities. i can speak as a parent of two

young children at home that my wife and i continue to get a very good education every day if we don't recycle and we waste water and don't turn off the lights. >> that's fine. should the federal government through an agency like epa be telling our children these things or should it be us? i'm a father of four children. i totally agree. we recycle everything. we want to do that. we want a clean environment for our children and grandchildren. the question in my mind is, again, through the educational system, should we be, in my view promoting what i consider a political agenda to an agency that's not involved directly in our educational system? >> you and i may agree or disagree on whether there's a political agenda there. there are many things schools are asked to do that maybe they shouldn't in the past had to do.

your four children are lucky to have an active family. unfortunately, we have many, many children coming to school who don't have those lessons at home. this is a little bit off topic. i had tens of thousands of children in chicago who i fed three meals a day. i sent food home with them. people challenged me, was that the role of the school system to provide nutrition. in an ideal world, i wouldn't want to do that but i had to. whether it's financial literacy, schools are asked to do more than they have in the past. is it a good thing? i don't know. if they are not eating and getting eye classes, they have to step up to provide the opportunities. >> i disagree with that. my view is environmental protection agency is not the

avenue for the government to address these issues. if anyone does, it should be state, local or federal education people that really understand education. finally, i would like to say thank you for your testimony and for your advocate si for our nation's children. thank you. >> thank you, sir. >> thank the gentleman. >> thank you mr. chairman. thank you mr. secretary for being here. my two cents worth on employment. i hope that as that ruled, there's some date for implementation. it brings accountability to the student for their education that they are taking a loan on and to the taxpayers on how the money is being used. i think it's a good process we are in and hope we continue it. the other observation, i was glad the secretary said we need

the educators at the table as we look at turning schools around. my colleague also mentioned the stress and the pride of the profession. i think you also mentioned that the profession is beat down right now for a lot of reasons. i would suggest all those things are true. but, i would also suggest that recently, we have seen a lot of attack and commentary against teachers based on collective bargaining agreements based on the cost of the budget and the stress some states are going through. the governor of wisconsin was bold enough to call teachers a privileged class that needed to be reduced more. i think as we try to lift the moral of teachers that kind of

commentary works in the opposite direction. it makes it harder for us to find good people to want to continue to be the critical part in education. that's educators. you also said something secretary. this questions back home all the time. you said when i was head of the public school in chicago, ignore the state to get stuff done at the local level. the improvement grant being a strategy. a question. you hear more and more whether it's english learner issues or incentives to go into certain schools. more atonmy in terms of resource allocation so they can apply it that way. how do you see that question? >> i absolutely agree with that sentiment. so, you know, school improvement grants go through local community. they decide the most effective

resources. the teacher incentive fund grants that come up with their ideas. we want to reward. we are pushing everybody hard to change. we are pushing management. they all have to get better. our department has been part of the problem. we have stifled innovation and creativity and finding it. we want to reward excellence and put resources behind places willing to do things differently. i think what we have done is unleashed a huge amount of creativity and work. we want to continue to take the scale. >> middle schools, proportionate share of title i funds, being a piece of legislation. i think they both directly and indirectly talk about the share of title i funds going to those two parts.

>> trio and again, if we want to get serious about the drop-out prices, fifth, sixth, seven and eighth grade. we know where students are struggling. how do we make sure they are taking high school algebra to take calculus as a senior. we have to provide opportunities early. the middle school is neglected. your focus is hugely important and we want to invest title i, school improvement, scarce resources to get great talent in there. often students start to learn interest in science and technology. the teachers don't quite know the content. getting more great stem teachers not just for senior year, but fifth, sixth and seventh grade. >> thank you. yield back, sir. >> i thank the gentleman.

>> thank you mr. chairman and secretary duncan, your staying power at the witness table is impressive. >> you are wearing me down. >> that was the school system, cook county and chicago school system of my birth and education as well. for you to stay there that long indicates your staying power. thank you for staying with us. it was mentioned the d.c. opportunity scholarships program and there's certainly some disagreement on whether or not that should have been expanded or continued. i personally am one that likes to see a lot of competition and variety. a lot of framework for research and development that comes from things like that. moving into my question into first in the higher education

realm. the department finalized regulations that caused private and faith based college universities great concern as they will most likely require increased regulation by the government effecting potentially the atonmy and religious liberty of these schools. are you planning on clarifying these regulations or making accommodations for the concerns that we might have? >> this will be great feedback. we'll say where we are. under the regulations, states are permitted to exempt religious schools. that exists now. >> if i just jump in, is that just for the mission courses, i.e., if it was a seminary or divinity school they would be exempt from the regulations just

in the courses of religious education or would it be like one of my alma maters, wheaten college where it's across the board. >> wheaten is a great university. it's exempting the schools. >> the schools in total. >> what congress requires of the state authorized schools. we are asking them to do a couple basic things, not be heavy handed or anything like that. a state has to have a process to review and act on complaints. a place to hear what the issues are. a school is authorized by name as an educational institute by a charter, statute, provision or anything issued by the state. and the school complies with state approval. just the basic common sense things that states have the responsibility to give them by congress -- >> there definitely is a lot of latitude in there for concern

for how far, how aggressive the regulating entity of the states might be. >> i understand that. we'll continue to provide clarity. there's some states like new york who have done this extraordinarily well. there are examples out there that are thoughtful, not heavy handed. i hear your concern. >> i applaud that effort. again, the diversity that's there, this country is not built on that as i'm sure you agree with. >> we have the best system in the world. >> they all come here. moving to a foundational area with early childhood education, the administrations education budget wishes to spend, as i read it, $350 million for education programs. early learning challenge fund. this leads to more requirements for preschool program that is

are privately run or faith based as well. what will you do to ensure protection for them and the service of private preschool centers as you go forward. >> it's a voluntary program. they can compete or not compete. there are two goals, increase access and to make sure it's high quality. they are the only two goals. >> won't be any hurdles that would keep a school like this from applying or being able to apply due to resources or to gain the resources because of some of the standards set up? >> we want to go to the most distressed communities to give those children a chance at life. that's the goal. >> thank you. i yield back my time. >> thank the gentleman.

in order to keep my promise, we're going to go on the three-minute clock. i would like to give everybody a chance to ask a question. mr. payne. >> thank you. for the new members that came or those who have been here for the whole time, anyway, try to stay to three minutes. very good. clever. i didn't know you looked over here. anyway, last week, mr. secretary, during a committee hearing on education regulation, i asked the louden county if they thought they would be focused on educating equally. nclb had not shed light on such an achievement gap. to this, he answered the our co

actually disaggregated before it was law. we realized, he said, that when you are as wealthy and have as high a social economic index as we have, children do not have those same opportunities and are in greater danger of not succeeding. so i think it's very fair to say that probably one of the most important changed outlooks of the law has been the disaggregation of data and reporting that, and i think it would be fair to say that had the law not been passed, practices would not have changed. we recognize in a place like this county, it would have been easy to let the performance of our students mask the issues we face. as far as i'm concerned this is the signal strength of the law.

now, his statement supports much of what has been alluded to today. nclb drew attention to poor performance of specific subgroups in our schools and held schools accountable for improving their performance. however, some have inferred that the department intends to have a targeted accountability focused only on the lowest 5% of schools. these schools are -- that educate a significant share of the nation's disadvantaged youth, but there are also a large number of disadvantaged students in schools above the 5% threshold who prior to nclb were not receiving the attention they deserve because as dr. hartwick said last week, it was too easy to let the overall wonderful performance on average mask the issue they face. so in my opinion i find it equally important to hold schools with demonstrated capacity to educate some of their students to high levels accountable for educating all

students regardless of the demographics. can you assure us that, you know, reiterate how the blueprint maintains accountability for students subgroups since you're just basically going to focus on the lower 5% and that other group not disaggregating can go back to the way it was? >> it's a great point. you can rest assured we're committed -- in my opening statement how we are going to continue dising a aggregated data. we want to continue to look at those gaps and challenge them and so we will absolutely maintain that accountability. let me give you one more though what i would also argue what never happened under nclb is those districts that did a great job of closing the gaps, no one ever got rewarded. no one ever got recognized. we didn't learn from that. yes, we want to hold folks

accountable but we want to shine a spotlight on success. where you have districts that are closing gaps and helping every school be successful, we want to recognize them and reward them and learn from them and give them more flexibility so rewards at the top, challenge folks to continue to improve, massive interventions. if districts and schools aren't making differences, intervention if you need be, but also reward excellence. >> gentleman's time has expired. mr. kelly. >> thank you, mr. chairman. secretary, good to see you in person after talking to you on the phone. i know you have a great passion for this, but i really do question where we're going with the spending because it's not that we don't spend enough. it's just that we don't get enough for what we spend. and if there was no clearer message on november 2nd, we have to rein in the spending. i'm just looking at this. for a budget that has increased 68% in the last three years, in 2009 alone the budget tripled. my question, mr. hunter asked this several times, why not redeploy funds that aren't

working and why isn't part of the strategy let's eliminate what's not working and put it into what is working. i keep hear being so many countries are doing it better than we are. well, obviously we must know what other countries are doing. why continue down the same path we're on and not getting results for it. and the private sector, i have to tell you, when it's your own money, your own skin in the game, you don't have that option of just spending it. i think the worst thing we can do is continue to throw money at a problem. we have to start coming down to a strategy that actually fixes the problem. what's the strategy because a lot of people are stating to wonder why do we even have a doe? we're spending tons of money and we're not seeing results for it. >> what i would argue to you, sir, in the past two years you have seen more changes in this country than the past decade or two combined, and i would make a pretty compelling case to you that because for the first time our department was rewarding excellence and encouraging that kind of creativity and ingenuity and courage. you have seen those dramatic

changes. so i would be the first to concur with you. our department historically has been part of the problem. i have told the story repeatedly i almost had to sue our department of education when i ran the chicago public schools for the right to tutor my children after school. no sense whatsoever. i won that fight. >> i would say i'm not an adversary. there's not a person in this room that doesn't want better education for our kids but there's also on behalf of the taxpayers who fund every one of these programs, where is the return on the investment and when do we start to see that there is actually a positive to this because everything i look at looks at a tremendous spend and a flat line. >> i understand that. so i would argue that there's compelling, compelling data that investments in early childhood education, particularly for disadvantaged children are hugely important. yes, we want to invest there and we haven't in the past. i think there's been a strategic error on our part. we're trying to drive dramatic k to 12 perform, higher standards, better assessments, much more flexibility to reward excellence, and we're asking to continue to fund young people

who are trying to go to college with access to pell grants because they need that. >> and i understand that, but my question goes back to we keep spending more money and at some point it's got to stop. it's absolutely got to stop. the argument always is well, there's a lot of people out there that aren't paying their fair share. really? look what is being paid. there's no other country in the world that invests more in education than the united states and has a lower return on the investment. my question and again i'm not adversari adversarial. at what point do we realize what we're doing is not working and when are we going to stop? i understand you're saying there's compelling evidence it's getting better -- >> if i can interrupt, i'm sorry, the gentleman's time has expired. >> thank you. mr. scott, you're recognized for three minutes. >> thank you, mr. chairman. thank you, mr. secretary for being with us. you mention the achievement gap, the 1954 brown decision talked about the harm inflicted on children when the children of the minority race were denied an equal educational opportunity.

the school system maintains a significant and persistent achievement gap of the children of the minority race being denied an equal educational opportunity in violation of their civil rights. >> i think all of us have to use every fiber in our body to close those achievement gaps and where you have huge and gaping achievement gaps, we're trying to push more dramatic change than you've ever seen. every child has a right to have a great education. we have to provide those opportunities, particularly for disadvantaged children. that's the only way we end cycles of poverty and social failure. >> speaking of civil rights, in the department of education, they give out grants. if the sponsor of a grant insisted on discriminating in employment based on religion or which church a job applicant attended, would your department continue to fund such a program or not? >> i understand the significance of the issue and the question, and it's one that i will follow up with with the department of

justice. >> so it's possible that you might continue to fund an organization that is -- has a policy of employment discrimination? >> again, this is an area where the department of justice, i think, can provide some real guidance and help and i will follow up with them directly. >> civil rights implications of zero tolerance policies, particularly in pre-k, people being expelled, can you tell us what the department's position is on zero tolerance, kicking kids out of school without any services? >> so one of the things our office of civil rights is doing is looking at places where you might have disproportionate rates of ex suptiopulsions or ss whether it's by race or whether it's young boys of color. and where we are expelling students to the streets, we're part of the problem. and so we are going to track that. we're going to challenge that. and there are many places that are finding creative ways to help the students who struggle stay engaged in school and be

successful. we need to continue to learn from those examples. >> since you're going to get back with me on the other, i have several other questions that i'm obviously not going to have time to address. but you indicated if a sub group fails, the resources -- the response ought to be targeted at that subgroup, not school wide. if you could follow through on that -- follow up on that. and also you mentioned the importance of higher education. could you talk about -- could you tell me what your strategy for access to higher education is and college completion, particularly as it pertains to the trio of programs, and whether there's strategy in dealing with dropouts and no child left behind. some of the dropout factories are actually being awarded ayp which seems absurd to me.

finally, there's controversy over what to do with less qualified teachers but there are two problems. to my knowledge there's no accurate measure of what an effective teacher is, and you have the counterproductive school collaboration where teachers might not want to collaborate and take on problem children because it might affect -- adversely affect them. can you talk about how you're going to identify who a qualify, effective teacher is? >> the gentleman's time is expired. you have to talk about that on the record and we would appreciate if you would do to. you're recognized for three minutes. >> thank you, mr. chairman. mr. secretary, in the interest of full disclosure, i had the privilege of hearing you speak in colorado several years ago, and despite some differences left that seminar finding you to be incredibly candid, challenging, willing to offend if necessary, and i want to

thank you along with my colleagues for being here today. i want to ask you about one thing. because you mentioned reform, and listening to your testimony it strikes me that if a program is working or if it even appears to be working, you would be willing to continue it. so i have to come back to the opportunity scholarship program. 91% graduation rate. the reading scores are higher. the math scores may not be higher, but educational attainment is being reached even if -- assuming arguendo educational results are not. the parents like it. the demand outpaces the supply 4 to 1. so why not continue it? >> again, more than fair question. i stated earlier we fought very hard to keep children in the program, to be able to stay in those schools and we were able to do that. i would disagree a little bit with you on the results. i think the results were pretty mixed actually but at the end of the day what i see our responsibility here is to create a great system of public

schools. where the private sector, where the philanthropic community, where individuals wants to step up to provide scholarships to a relatively small number of students, that's fantastic, but we have to be more ambitious. we have to fix the d.c. public schools that made remarkable progress, great local leadership. we'll continue to invest in that transportation. my goal is not to save a handful of students and leave the other 500 to drown. my goal is to save every single child and that's what i think our proper role should be. >> if i told you we could craft legislation that funded all three sectors of the d.c. school system, public, private, and charter, fund all three of them, would you then support the opportunity scholarship program if there was no harm being done at all to the public school system and no harm being done to the d.c. charter school system, would you then support it? >> i don't think any harm is being done. again, our focus has to be to great a create set of public

schools. they're expanding charter schools very significantly here. we want to create access to great public schools every child. that's where our focus has to be. i'm a big fan of choice, a big fan of competition, but it has to be access across the board, not for a tiny percentage of students. >> i will do something uncharacteristic and yield back. >> mr. holt, you're recognized for the final three-minute question of the day. i'm almost going to keep my promise, mr. secretary. >> thank you, mr. secretary. thank you for your endurance and all of your good work. let me just state two questions and three comments, ask you to get to them as time allows or get back to me or the committee with your answers. first of all, what do you imagine doing with $90 million and why is it important? secondly, in your legislative proposal, you propose ending the

year-round or summer pell grant programs. why are you picking on that? is it they are already determined -- they're new -- relatively new. are they already determined not to be as successful? why did you choose to cut there? my three comments or concerns, i remain concerned that the math and science partnerships are combined under teacher effectiveness and it puts science in competition with gender equality and foreign languages and other such things, and i question the wisdom of that. also, you're celebrated for your competitive grants and, indeed, you have shown how the competitive instinct gets people to work hard, but if the best practice is not replicated and extended, it turns out to be

very inequitable, and i guess i'd like to know what measures you are applying to see that in -- again, this is new, too. you've only been at it for a couple years, but what measures are you applying to see that the competitive grant actually results in, well, lifting all boats? and i had a third concern, but maybe i will let it go -- oh, yes. i'll let it go at that. thank you, mr. secretary. >> so what i have said repeatedly is i think the education sector has lacked the transformational change that other sectors have had. i think technology can be an amazing -- can do an amazing job of accelerating learning. i think we have to be much more thoughtful there. we need to invest more in r & d and this is a chance for us to

invest in a set of players that could potentially transform the learning for young people. and i think a part of our job is not just to deal with the day-to-day issues but to look over the horizon. if we can see those kind of transformational changes in the education sector in part due to our investment, that would be a hugely important piece of work that we could do for the country. on summer pell, we discussed it a couple times. again, in an ideal world, in flusher times this is not a choice i had have begun to thought about. in tough budget times you have to make tough budget choices. the summer pell was set up with a estimate of a couple million a year and it ended up being a coup couple billion dollars. if a perfect world we would continue that. our choice was to try to maintain the commitment to -- for the $5,500 pell for

everybody. >> thank you. the gentleman's time is expired. mr. miller, you're recognized for any closing remarks. >> i won't take any more of the secretary's time. thank you, mr. secretary. we'll all have follow-up conversations. >> i thank the gentleman. mr. secretary, i thank you. i do have one note that i'd like to bring up. the last time we had a hearing we asked for some responses for the record. we, frankly had the hearing in march and got the answers in december. we've had several requests today. i hope you will look at getting those responses in a timely way as possible. i apologize to you. i'm seven minutes over. thank you very, very much for your attendance, for your testimony, for your responses. there being no further business.

>> that would be top of the list and that, of course, is the -- that is one of the threats -- the threat from international terrorism is one of the threats -- one of the top one tier 4 threats in the national security strategy. thank you. >> yes, i mean, the balance between whether we're looking primarily at domestic or international issues is driven by, obviously, external events but also the intelligence that we get from the heads of agency.

and, for example, we might look at depending on the information we're given whether military assets might be moved into counter-terrorist space or operational space or training depending on what the balance was between the intelligence that we were getting for the relative requirements of it. and that's one of the areas where actually having everybody sitting around the table with the heads of -- the heads of agency able to give live feeds to all ministers simultaneously and enables us and has enabled to us make decisions where assets might be best required rather than waiting to react to events. that's real example. i want to amplify one thing william just said. we have, of course, as he mentioned spoken frequently about counterterrorism and liam has mentioned that sometimes defense questions it's stretched out to intercommunal relation that prevent strategy.

the connections between those quite complex domestic issues and international issues relating to countries where it appears to understand the relationship between parts of the british population and the populations of those countries. and it is the ability to span the whole of that range in one discussion that we have had immensely useful is the character of the national security council. i think it would hard to imagine to have those discussions if any other form? >> and another example was international and domestic. and that's been on the agenda at the nsc. >> all right. thank you. and my final question is, any thought of a cabinet minister for national security? would that add to this process or detract from it? or is it all beyond your pay grades? >> it is something beyond our pay grades and it's something we

have discussed in the past or i've discussed with the prime minister in the past particularly before we came to power. and we've taken the view that a minister for security in the home office is the right way to have a security minister which, of course, is what we have. and that minister is a member of the national security council. because ministers with responsibilities in these areas really need their presence in a department and the leverage and the wait and white hole that comes from that in order to be able to operate satisfactorily. >> okay. thank you. >> so the nse is a strategic body that discusses it and forms a discussion everywhere. it's not a war cabinet then in the sense that it takes executive decisions about -- i mean, i'm interested in the decision-making process.

is it just simply an advisory body then or do you all sit there and say, yes, this is a good idea. and the treasury agreed, by the way and this is what we will all do and that is then a set of actions that are put into training in all the other departments. where does that then leave the rest of the cabinet in decision-making processes and more importantly actioning any activity that you decide and the money goes forward? >> it is an executive body and practice, although as oliver has explained it is a committee through the cabinet and its decisions are reported to the cabinet. of course it takes many more actions and takes many or issues in gone over in the cabinet in detail. the cabinet discusses security issues, international issues and defense and diplomacy as well. but not in the same detail as the national security council which meets at least once a week

to go through a range of subjects. so it is the effective decision-making body and the vast range of the government's decisions surrounding these issues and that actually is why it works so far because, of course, we all know that structures of government are one thing, but how you use them is another. and you can set up as many structures that you'd like but if you don't use them as the decision whitehall does not be massachusetts made with them and decisions are said elsewhere. the reason the security council is making is the majority of decisions are appropriate of the national security council are made in it and, therefore, departments have to prepare their papers and prepare their ministers to make those decisions in it. so it's not just an advisory body. it is the center of our national security discussions and decisions.

>> and ministers, therefore, are bound by their decisions and that is agreed by the treasury and you sit there agreeing. >> it's agreed by the treasury. >> it's their part of the process and presumably if that might disturb some of the will be are the plans about finance nevertheless the treasury would agree with it and so you can do it? >> well, no doubt that would also need to be something that change the financial plans of government would need to be discussed in the cabinet as well. that would be sufficient importance and it would need to be discussed there as well. but, yes, decisions do flow out from the national security council including into the agencies and you asked you how other ministers then are consulted. remember, as has already been mentioned when other ministers are relevant and the departments are relevant to the decisions as liam was saying, they're there in the national security council. and the intelligence agencies are there. the chief of the defense staff is there. another of its advantages although we can digress too much, i suppose, is that the people like the heads of the intelligence agencies come in to

much more contact with members of the government other than the foreign and defense and home secretaries than i think they would have done under any previous arrangement. >> one other point that is important and we we have dealt with it yet in answer to your question which is that, of course, there are also members of both sides of the coalition present. and the deputy prime minister is there very importantly. so too are other -- the democrats senior ministers and, therefore, it isn't that it formally is a very important committee cabinet. it's also that practically speaking it constitutes a coalition discussion. and that's a very important feature that i think -- >> well, i wouldn't want to advise you but if you're going to have any cooperation process i'd incorporate the minute. >> but the vice chairman has reminded me of the war habit. what's happened to that. >> well, the national security

council is the center of decision-making about, for instance, the conflict in afghanistan. and it takes those decisions on a regular basis. >> wasn't there a thought that the opposition should be invited to take part in the war cabinet? >> opposition have been invited to the meetings of the national security council. and have -- i think on at least one occasion have attended. >> when she was leader of the labour party harriet harman attended one, i think, in the early summer. >> is that formalized in any invitation structure or is it just as when the prime minister thinks it's appropriate? >> when the prime minister decides from time to time. but he made it clear on that occasion that he would continue to invite the then-acting now actual leader of the opposition if there was a particular issue where he thought there was likely to be a huge national advantage in doing so. >> well, i'm sure we'll come on

to other opportunities for invitations of the opposition. [inaudible] >> thank you, mr. chairman. on the creation of the national security advisor, what effects has that had on the articulation of a national security strategy? >> i'm happy to begin but william may want to say more indeed, liam. sir peter rick kettets -- rickets are part of the security team gathering information from material from all sources. and tried to ensure that the agenda and the papers and so on are in good order and that the council is considering the things it needs to consider and, of course, he is very, i would say -- speak about this is very closely linked to the senior

minister president and the senior minister and the deputy prime minister so that it becomes possible not simply to have a committee served by one department or another but effectively by its own secretary and that's what peter rickets is in charge of. >> just to add to that, we appointed the national security advisor on the first day of the new government. we thought that was essential to start building and had thought a good deal about it before the election and who could do it and in addition what oliver has explained and the existence improves the articulation as you say of the national security strategy is that for other countries, the national security advisor is an excellent point of reference and contact. and the four systems such as the u.s. system of government which has a national security advisor to the president for the french system of government that has a

specific advisor on foreign security policy to the president. it provides a ready counterpart at a very senior official level for those country. >> how has the nsc improved security thinking and crisis management? >> well, it give us an opportunity to have wider contact to get information from the intelligence from across the intelligence services in real time. as, for example, we've gone through what's been happening in north africa and the middle east. it's enabled us to get a constant feed of information it's enabled us to cross-reference pretty widely. and i think it has enabled us to have a breadth that perhaps wouldn't be available in any one department. and very much part of the point of peter rickets a contact single point. it's extremely useful for us to

have a point of reference. somebody that we can talk to, somebody we can commission and work from if we require it. if we know, for example, there's a specific issue arising and say can you go out to the range of the agencies and get his reports and get us work brought in for certain time? and that, i think, has been very helpful. i also think it avoids duplication or triple cation. >> how has crisis management are you looking at how crisis management is done within the nsc or within whitehall and thinking of ways to improve it, change it? >> well, i think the nsc was originally conceived as what its name implies, a security council and its first writing task is

strategic, not operational. it is not cobra. >> uh-huh. and it's, i think, quite important to hold that distinction between the large scale decisions that fought to be made and the widest set possibilities and to manage a particular situation. so nsc is strategic over tactical in those terms. >> that's roughly how i would describe it and i think my colleagues would agree. >> i'm conscious of the fact that there's a large number of people standing. there's one seat over there for anybody -- if somebody would like to remove that seat next to mr. mitchell who won't be needing it towards the back, then please feel free to sit down. and if anyone wants to go to that one, they should feel free. >> just can i -- that last

question is worth pointing out as well as the nsc itself. there's the nsc officials who week on a weekly basis, which will often take forward work that the nsc has asked for or made -- prepared work for the next nsc so it's complementary of ministers. >> and cobra -- do they come in on those meetings occasionally? >> well, some of them will be the same officials. >> i would like to give some comments from the chief of defense staff that he made to the committee in november around the construction of strategy. he said it had been agreed to start constructing a mechanism to deliver a grand strategy looking at the world as it might be in 2030, 2040.

i'd like to know the reaction of the ministers on how realistic that is and perhaps could start with mr. letwin. how do you describe the grand strategy? what do you think it's meant to achieve? and has that been taken forward? >> the overwhelming point in that that we made a decision after a lot of discussion to adopt what we call an adaptable position because we came to the view that we were not likely to be omni present and the things

that happened last week bear out that reasoning. and, therefore, the whole structure of what was decided which the other colleagues would like to go into more detail started from the proposition we don't know what will happen so let's try to be able to respond to a whole series of different possibilities. and, therefore, the thinking about how things might look 5, 10, 20, 30 years out is a useful exercise to engage if continuously but we're not doing it in the spirit of internationally that we will arrive at offices that enable us to go definitely for one thing rather than another. we will constantly maintain an adaptable position that allows us to respond to events as they

unfold. i think that's quite an unfortunate -- >> to be clear, it doesn't have a practical value? is it does provide a platform for narratives that might assist in decisions sometime in the future? >> well, let me -- let me mention some respects in which it might. we don't have the energy secretary here although he is a member of the national security council. you might want to interview him about this. but i think if he were here he would say some of the decisions we make about our energy security, which is certainly a very considerable thing, not in its economic impact but in its general security impacts which liam has spoken about a great deal, and which we discussed quite frequently national security council one way or the other and clearly is highly relevant. some of us in the security field relate for his for the building of nuclear power stations. clearly it's one if you made it clearly is not very adaptable.

you got the thing around for a long time to come. so it helps to understand, you know, whether it's likely that we're going to face energy shortages 20, 30, 40 years from now or whether we might at least be prey to people we might not want to be prey to if we didn't have enough of our own homemade energy. so it might help you to make specific decisions in that sort of field. what we are not trying to do is to lock ourselves into designing the whole of everything in such a way that it is based exclusively on the assumetion that we know the future will be with us because we don't know how the future will be. >> i think we could all add to that. [laughter] >> thank you, mr. chairman. and a grand strategy and an adaptable approach to it recognizes, of course, that britain's security is not just

determined by ships and aircraft but also by the extent to which we can train the police in afghanistan. we can build up governance and accountability structures in the yemen. and indeed ensure that we get girls in school in the horn of africa. and that wider approach to security, tackling the problems of insecurity and the causes of problems upstream is far cheaper than having to send in the troops. >> and to add the point from a foreign office point of view, what is decided here, looking ahead to -- out to 2030, 2040, the national security strategy set out some of the changes going on in the -- that can be anticipated. now, in terms of broad terms, in terms of national institutions, the importance of climate change, demand graphic trends and so on, from which we decided that it is very important to maintain a strong global

diplomatic network for the united kingdom. this is one of the reasons we are not shrinking the diplomatic network despite all the pressures on government expenditure because in a more multipolar world and a more complex network we will need that in different places. i think across different departments these long-term trends have informed the decisions that we've been taking. >> i think there's an essential analysis that underpins all of this that we live in a genuinely globalized economy where our risks are more widespread in more places and subject to more actors elsewhere than ever before. and while globalization brings the upside of treating prosperity it brings the unavoidable importation of strategic risk, therefore, we have to look very widely at where the risks lie. mitigate the risks or the assets

we might bring and what alliances and what other structures we might involve to reduce those risks to the wider u.k. interests at home and aboard and i think that's what the they were talking about in terms of that wider strategy and the fact that we already have some documents, for example, the mod's global strategic trends document does look out further, makes some provisional judgments on potential scenarios and is informed -- and informs all the thinking put out by the bdcs and the committee would like to sight of these. >> we had the document that was in, i think, february of last year, which was very helpful. madeleine? >> i'll start by asking mr. mitchell, you've tied very much to fit in with defense's security. do you see a risk increasing for different staff and ngos in

being so closely allied with defense-instituted policy. it's an issue that's been raised a number of times in addition to afghanistan in the risk of ngo staff. are we, in fact, placing independence and sort of neutrality, if we like, a guy who's interested in need and good causes rather than an arm of government. and they described the prime minister of a modern equivalent of a battleship. is there a risk to staff? >> well, we are -- we never compromise on our duty of care and the duty of care for different staff is precisely the same as the duty of care for foreign office staff as well. this is part of a debate which i think confuses securitization with working in some of the most difficult and conflict-ridden parts of the world.

and we give very strong support. we announced some today to the international committee of the red cross on humanitarian relief and that sort of work is circumstance blind. it focuss on all circumstances on those who are caught up in combat and difficulty. the work of doing development, a lot of which is very long-term, is carried out from my budget. it is -- all of that budget is spent in britain's national interest but it's also very much in the interest of the people we are seeking to help. and the confusion and the debate, i think, is that working in conflict states, you are addressing people in the world who are doubly wretched not because they are extremely poor but because they are caught up in conflict and dysfunctionality. so i think the debate sometimes gets a bit -- a bit confused. nevertheless, working inflicted

states, you're working in the places where maternal mortality is highest, where children have the least chance to get in school, where there's food and security, a lack of choice for women whether and when they have children. i don't myself believe there's any real confusion about the priority of britain's development work taking place in some of the most insecure and vulnerable places in the world. and when the last combat soldier has left afghanistan, the work of development will still continue there because it is one of the poorest countries in the world. >> yeah, i've got another comment for the chief of defense staff when he came before us in december. he said the national strategy document is not about objective in terms of our ends but i would say the ways and means of an area of weakness i'd just like to ask the ministers do you agree with this signals and has it been addressed if you do agree that there's a weaks in

isn't it so >> the national security strategy is an assessment largely of the risks of the impact and likelihood in broad terms what we need to do about it. the means are more set out in the following days publication of the strategic defense and security review. so whether people think that is an area of weakness depends on what they think about that review. but clearly these are things that for the first time in government have been properly tied together. in your terms looking today, the processes here, that assessment of risks overall sense of strategy and making sure the sdr supported it, that's what this process is. >> whether people think it's an area of weakness, if the chief of defense staff thinks it's an area of weakness, does that cause you concern? >> well, the chief staff is

fully participating and is fully committed to it the defense secretary talking about that one. >> but that takes fully apart in the nsc in both the formation of the security strategy and, of course, the central to the sdsr itself. if you're interpreting the comment to him that the military think it would be nice to have an unlimited budget, i'm sure you're correct. >> well, i mean, it's quite clear that the national security document came out one day -- the report came out the next day and the implication of what he's saying the one didn't meet the other one's statement of need. that's quite clear. so, you know, either you -- it's agreed or not. >> well, i think what he might be referring to is the fact that for a very long time there hasn't been a very tight correlation between the two and one of the changes that we envisage is that we refresh the nss and the sdsr once every parliament to make sure that we

are constantly trying to ensure that we're matching the assets we would require to deal with any of the problems with the identification of the problems themselves. that is a constantly changing picture as recent events have shown. >> we'll come up to that. >> can you briefly describe how the national community strategy is developed and how it will be delivered? >> the starting point was the consideration of the risks that the country places. and a great deal of work has been done. this is not invented on the present government. it had already been going on with the previous government. it's been developed and on the present government in a assessing the impact of differing risks and the likelihood of differing risks.

and in developing, therefore, kind of a matrix with an x axis and the y axis where the y axis is impacting the x axis' likelihood. and the attempt is to identify in developing the strategy to identify in particularly those risks which either had very high impact or very high -- most of those who had both impact and high likelihood and that was the starting point for thinking through how to develop a security strategy because it was intended to be a security strategy. that's to say the ultimate purpose of which was to provide the greatest possible security for the population of our country. now, obviously, once you start with that and you have identified a particular array of risks that matter most to you, in some cases, you can move

quite rapidly to specific judgments about sorts of things you didn't want to do. so, for example, we have identified cyber -- william mentioned a moment ago as a particular risk, a cyberattack. and as we made plain in the spending review we have allocated a very considerable additional sum to protecting us against us of cyberterrorism. that's where you can move from the identification of a risk, to a need and to a decision. but in other cases identifying a risk may is an important risk of highlighting high impact may lead you to a very considerable chain of consequences. what we tried to do in the security strategy is to go through that chain of consequences leading on some cases forecast on the decision not to engage in strategic shrinkage which william has referred to. >> we'll come back to that. >> so we'll come back to it. i hope i'm giving an impression of the order of our logic. start with risk, try to work out what the consequences of trying

to address the most important risks are and where that's a long chain go through and short chain go through it directly. >> the best strategy in the -- what was the thinking behind that? would have been would have it have been better to produce the national security strategy in advance or go to understand the sdr better? >> well, our thinking was to develop these things so that we could understand interactions as we move forward. but the thing which he we started with was the national security strategy so before we did anything else, the risk and the analysis of risk and what flowed from them was our thinking. we then began the work of trying

to work through both the sdr which i won't say anything more and the spending review which obviously interacted with producing all three roughly speaking contemporaneously was done precisely in order the people could look at the three and tied together which we believe, obviously, they do. >> so the security strategy and the defense review are not any stage one document? >> no. there was not a stage at which they were one document because they were other than conceived the strategy as something that we would lay out as something separate from the sdsr that we would lay out and, of course, the chancellor had it in mind to produce a comprehensive spending review separately from that from the start. >> and i know the question of the national security strategy and the risk assessment. there are three discrete elements in that. there's the need to reflect the changing nature of threats and any emerging threats. that's one area.

the second is for us to track how successful we are in our mitigation measures in tackling threats and risks. and thirdly how effectively our resilience and planning measures have been in reducing the potential impact so there's a number of different elements in there. they are set out discretely but they ever overlapping in practice. >> i'll come back to you in just a moment. >> professor clark describes the national security strategy as being a methodology towards a strategy rather than a strategy itself. how do you respond to that suggestion, observation? >> it is -- it is the outlying of those strategies certainly it's the method holling it's the clear methodology that oliver letwin has been talking about and then summarizes the strategic need and the strategy.

clearly as we said earlier the delivery of that is for the sdsr and for how we conduct ourselves over the coming years. since it's inherited in our assumption that we need an adaptable posture and military effect that the threats will change over time and need reevaluating. so certainly the methodology stands out particularly in it but it also contains the outlying of the strategy and then the follow-on document. >> the assessment, if i could go back to the assessment that we made because of the nature of globalization our risk are widespread and, therefore, we have to have a range of has given rise to the development of what foreign secretary and i refer to as a multilayered approached. in other words, when we identified the range of risk we have to have a range of way of dealing he them. not a one size fits all. for example, there are some things where we have to be able to add unilaterally.

there's some things we would like to add bilaterally and some with the similar nations with the foreign group, for example, sometimes we would want to do it through nato. we have a range of tools and i think one of the things that we felt at the outset of the process was that we're dealing with a very complex interdependent and multipolar world but we're trying to deal largely with international tools designed for the post-world war ii environment. and so that we needed to develop a wider range of potential options and tools for the u.k. which is why we've been spending a lot of time developing an elevated bilateral relations and to get ourselves into more groupings. one example is the fpd, the five powers defense arrangement in south asia long neglected foreign secretaries and i went to south asia because clearly there are a range of our interests in that part of the world and it makes sense for us to have a discrete and if you

would like element of our security apparatus that deals with that. so it is -- it is building up a picture of a range of responses to a range of potential threats. >> it says that the highest product of risks will not automatically have the worst resources allocated to them. does that run the risk of having a set of leaked tables of risks where the highest priority might not be properly funded which the prime minister seeks in the strategy of al-qaeda. who is responsible for deciding that resourcing and coordinating the democratic priorities of the national security strategy? >> the phrase to which you're referring means rather different i think from what you gleaned from it. identifying a particular risk as

having a particular place in the hierarchy of the likelihoods and impacts tells you how much attention you ought to pay to it. but, of course, some risk which may be very, very important, both in impact and likelihood may nevertheless be cheaper to deal with, even if you're putting a lot of emphasis on dealing with, it would be cheaper to deal with than other risks that would be less likely or have less impact but is intrinsically more expensive to deal with and so the decision about where to place your resources is not something that you read off a table of the impacts and likely hoods of particular risks. to return for a second just example so again what i'm talking about, the case of cyber. we analyzed cyberattack as one of enormous importance in this

country and increasingly importance over the near and possibly long term. but there are simply limits to the amount of money that you can spend on it because it requires an enormous collection of incredibly clever people to do things, to make an impact upon it. >> we've got those enormously here today. i want to if one shape or another address all of you and it's in the national security strategy which says the national security council has reached a clear conclusion that britain's national interest requires us to reject any notion of the shrinkage of our inventories. and, of course, the question arises whether this is overambitious. and i would like to particularly address mr. hague and mr. mitchell and ask you both if you could explain how this foreign policy baseline actually -- how intact and how it's reflected in the national

security strategy in relation to you two? >> may i start off? this is something we feel very strongly about. and it is, of course, directly applicable to the foreign office to begin with. there are all the factors at work but i was listening in answer to an earlier question. and that means that we have to maintain our extend our influence in multilateral bodies, whether it would be in climate change, negotiations and the deliberations of the g20 and the u.n. security council, whatever it may had been but also given the way the world is developing in bilateral relationships as well. and indeed, one of the reasons we're able to accomplish our objectives in many of those multilateral foreign is that we have strong appropriate bilateral relations. and indeed the importance of those is elevated by the development of new networks of

alliances and friendships in the world. to take an example, turkey, we've given a lot of diplomatic attention in the first 10 months of the government across government to the relationship with turkey. obviously, a country within nathan but not within the european union. turkey is trebling the size of its diplomatic corps, opening dozens of new embassies and consulates so a strong bilateral british engagement with turkey is necessary as well as working with it strongly multilateral table. now, to do that effectively, of course, you need that global diplomatic presence. indeed, it needs to be beefed newspaper some places. and the right combination to coin a phrase is hard power and soft power around the world to be able to influence events around the world. and so that is the objective and that is the particularly right

place to start off. if you left everything to itself given the shrinking economic accounted for by the united kingdom or by the european union, our influence would naturally shrink so we have to exert ourselves to make sure that we don't. in the case of the foreign office, that means changing its budgetary arrangements. under the last government its protection from exchange rate movements was withdrawn with fairly disastrous effects. we have restored that protection. it's funded so that we can maintain our diplomatic network. i will announce in the coming weeks or months shifts in that network so that the network of our embassies and consulates is being adapted to the shifting pattern of world influence and the world economy. but it's not just a matter of foreign office presence. it's a matter what we're doing across the entire range of these

activities, which is what why you wanted mr. mitchell to answer as well. >> but before he does, cutting the service fleets to 19 ships, getting away from eric carriers for 10 years can you really say that our influence will not shrink as a result of these decisions? >> well, i think that depends on what we do in other areas. >> it's compensated for elsewhere? >> well, i think it is a mix of these things. and if the defense secretary want to talk about the strength of defenses that we will have in the future, notwithstanding, the fact we have to make some painful decisions along the way. >> yeah, i recognize the painfulness in the decisions. it's just that this denial of a shrinkage of influence strikes me at any rate, i don't know about the rest of the committee,

as being a little unrealistic. >> well, my colleagues will want to speak as well on that. but influence just doesn't depend on the resources that you're devoting. it also depends on how you are using them. and clearly one of the things we're trying to do much more effectively than in the past through this national security structure is to use our resources of whatever level in a more coherent and effective way. i was talking about turkey and the way the defense secretary and i have worked together in turkey in recent months, defense and foreign policy engagement as well as the prime minister visiting and a major effort to develop commercial ties with turkey is a good example of that. working together in many areas in defense so we get more value with the money we put in and again, this is very relevant to the department of -- >> i'm sorry. i cut mr. mitchell off in his

prime. >> thank you, mr. chairman. well, the foreign secretary referred to the projection of soft power. i think it's important to make clear that one of the reasons we have stood by our commitments on international development, increasing substantially the amount that we spend on its national development is not just because we think it's morally right it's about the values that we have as a government and as a country. it's also because it is very much in our national interest to do so. and i was in somalia recently write saw very clear evidence on the ground of threats to britain's interests and her security. threats from piracy. threats from migration, threats from terrorism. somalia remains the number one source of terrorist threat to the united kingdom from africa.

so the budget is spent in britain's -- all of the budget is spent in britain's national interest, quite a lot of it is spent in britain's national security interest, too. and we agreed quite early on in the national security council that by 2014 we would double the element that is spent inflicted states, difficult parts of the world and increase it from something like 1.8 billion pounds a year to 3.6 billion. so i would just want to emphasize the fact that this is the projection of a soft power and that it is not just aid from britain. it is also aid for britain and for very strongly for britain's interest. >> can you tell us a bit more how this policy base -- this foreign policy base and from

your point of view given the soft power shouldn't that be just one department again? [laughter] >> i will not be beguiled even by ms. stewart into such heresy. [laughter] >> the whole question of influence is very multifaceted. we exercise our influence we do it bilaterally. we do it through nato, the u.n., the e.u., through our economic relationships, g8, g20 through our relationship with the commonwealth. the influence we have with our intelligence relationships with our countries. there are ways of affecting influence but i think the one asset that has not been discussed sufficiently in terms of influence actually is time. and it's the time that ministers actually are willing to spend working on those relationships

themselves. hugely i think underestimated. for example, when we set up the new northern -- i think i spoke to the committee about before, it had a number of reasons. it was to improve our relationship with norway, our bilateral relationship with norway, a very key energy partner for the u.k. but a country where the british prime minister was there and provide a better vehicle for sweden and norway for the security apparatus of the region to give reassurance to the baltic states and so on. that didn't cost us more than the price of the airline tickets to the meeting. but it did increase our influence in an area where we had been absent for too long. and i think that there is an undervaluing of the incredible influence you can get simply by having the right personal chemistry and investing the time

in getting those relationships going. there were no records of a defense and foreign secretary ever being in australia together. on the page of british visitors and below my latest signature were george younger, prince philip and montgomery. that was the sort of historic scale of the frequency of the visits. and we do need to better understand the -- how frequency of contact and influence can be brought to bear in ways other than hard power. that's not an important adjunct and it's not that itself in having influence >> it surely must be the starting point. if you put a ship in front of someone's coast that is a projection of power. if you don't have the ship you can't do it. just visiting them won't be

enough. >> exactly. to repeat the well-used phrase that soft power without hard power is music without instruments. >> well, actually on that very point i was just going to ask mr. mitchell, the laudable intention to double the amount of our aid which goes to areas of conflict but how is that going to be squared with the very tight rules we have? i think almost uunlikely rules we have on duty of care for our employees? which was mentioned earlier? >> well, you're quite right the duty of care must be paramount. it's the same for employees for dfid as it is for the foreign office. it's always kept under review. and it is, i hope, appropriate. it's important to emphasize that in some of the most difficult parts of the world, we work bilaterally and multilaterally.

and the point of these very detailed reviews about which i wrote to members of the committee last week of the multilateral aid that britain gave us and the bilateral aid, the country to country program is that it should be appropriate to the results we wish to achieve. so we are working out where we want to be, where we should be. those are decisions which are informed by cross-government discussions. what is the best way to achieve those results which as i said earlier are, i believe, strongly in britain's interest as well as those we are seeking to help. >> we've already had considerable difficulties in protecting the effort in afghanistan. if we're thinking more widely and doubling the commitment we make toward our -- normally we call war zones where conflicts are happy cover with it, without

strong partnership with the armed forces it's kind of hard to see how it can be achieved. the americans have a view on that with more military partnership but also a lower requirement on duty of care for that civilian personnel. i mean, how do you actually see squaring that cycle within a smaller defense budget having twice as many people deployed in more effectively civilians in war zones? >> well, it may not be twice as many people deployed as i say there's different ways of doing it but i should emphasize to mr. braisier in some of the most difficult and dangerous parts of the world, brilliant civilians, brilliant ngos do quite extraordinary business very bravely and very effectively. >> conflict prevention is a key element of the national security strategy. and yet, i think we've heard already there are limitations to

resolving conflicts if you reduce your capacity to provide hard power in areas of conflict. how does the national security strategy contribute to conflict prevention and the resolution of other crises? and i'd like to hear from any of you from that. >> shall i start? it respondent's exhibits -- it's clearly identified in the national security strategy, something to which we ought to devote more resources and effort. if successful is cheaper, of course, in conflict and it's dramatically less expensive in human life. and so it's identified as an important priority for this country. the range of assets and resources that this needs differs from one situation to another. one area where we have been, i think, we have been working successfully over the recent

months on conflict prevention is sudan where they are highly active and the ministers and officials work very closely together. so not only has they have been putting in its efforts and resources. as foreign secretary i've been calling on a special meeting on the u.n. security council and in november when we had the chairmanmanship on the council. since we both know some of the leaders on both sides in pseudo, we've both been at the crucial times during the refuse rend glum january in making regular calls to the people on both sides to ask them to act with restraint and whenever an violent effort occurred not to respond to it. britain is part of that effort. that actually is not -- that's an area of conflict prevention that doesn't require what we haven't deployed, hard power in the sense we've just been

talking about. our effort is diplomatic and humanitarian. and that the incentives we provide to people in that situation to prevent conflict are economic and diplomatic assuring them on both sides that there is a future relationship with western nations provided they can behave in a peaceful manner towards each other. >> so are you saying that with the reduction of the capacity, for example, of the u.k. to send task forces across the world -- we heard from the royal navy that capacity is reduced and you're going to rely more on your diplomatic skills and prowess than we have done in the past on, for example, sending a task force somewhere where there is the risk of conflict. >> well, there will still be instances where we have to rely on the royal navy being able to deploy but what i'm pointing out is that some of the major potential -- risks, potential

conflicts in the world are actually dealt with most effectively by a combination of development, diplomatic, political and economic resources particularly in partnership with other countries so it doesn't always follow -- i'm not saying there won't be circumstances where we need that military presence as well. but in our experience so far, a great deal of our conflict prevention work -- the majority of it is in that soft power area. >> i'm sorry, mr. mitchell. just in your comments could you also reflect on the statement you made last week on aid priorities and how that fits in with the delivery of the national security strategy and sdsr? >> well, the conflict prevention point that you raised and the statement i made last week was about focusing much more on conflict prevention for the reasons the foreign secretary has set out. and i want to emphasize that that is a humanitarian concern as well because the -- some of

the most retched people in the world live inflicted zones where they lose out twice over in the way that i described earlier. so the work of conflict prevention which my department carries out -- whether it is in trying to build up the capacity of the revenue-raising authorities to raise their own taxes, whether it's addressing accountability in governance which is how people hold their leaders to account for on structures. ..

sure we are going to be doing some things. and the get to libya. that question. we have to question how will be you can adapt to changing threats and circumstances and capability gaps? and the answer about how the nfc works where they use funding for new threats and all that which didn't answer the question about what is happening now. how do we respond. whig do we do given that we may have capability to send in

similar circumstances? >> by rolling back to the options first of all the question is really should we be reviving assumptions? >> that is what i meant. >> we specifically spelled of has oliver said to have an adaptable posture. that were quite strongly advocated that we should basically do what you might call sulfurous britain, withdrawing closer to home and investing in the appropriate assets in that direction. there were others the other where. that we should have a highly committed posture. i assume the conflict of the future would be like the ones we

face in afghanistan and the requirement for widespread maritime capability is. if we purposely choose an adaptable posture recognizing limitations of the amount of money we have available but what posture would give us the best capability to respond to vote predictability that exists out there. when a comes to the area we choose, we have for example to operate airlift capability. we decided that would be an area that we would have to invest in the c-17 to get the capability which was necessary. likewise, special forces. so the broad decision was correct to go for adaptable posture. will we have to constantly keep

that review as risk assessment in two years? endeavour four years, obviously -- i don't see any reason in light of experience to change the assumptions that were taken. >> does anything and would you see currently going forward about the instability in north africa, what lessons are you learning and taking into the nfc about how to respond? for example are you going to actually defer the tensions were you make different capabilities, that is necessary for the next two or three years as opposed to making a fundamental revision of policy for the substitute that you deferred and -- and look for the nfc to do that and say they are going against doctors. it might be a better idea not to

go against doctors because we might well be the base of the assets in the north african area. nfc decides that, will the money flow from that? >> the changes that we want, we tend to do that. one element above all we think needs to be put right and a that is -- in brussels. there has to be a proper balance when it comes international obligations. and what we're doing with our brighter alliances and there are key questions here and will be imagining in coming weeks for nato as a defense organization,

is an operating successfully for assets with the political will to deploy them because that is a crucial question in terms of the water capability we are able to get through the alliance we're trying to develop but it is not possible. we do not run the world. we are not a policeman. in other countries we should -- what we do because britney is unwilling to deploy its assets. >> so we have arrangements in the senate. none of your colleagues is saying we should run extra guns to them rather than -- hard assets we could use but did you say someone else? who was actually controlling the decisionmaking process? is this the world government? are you in charge of its? who is in charge? and should you decide that

change in particular capability was necessary, is the authority there to do that is that your decision? >> theoretically, it is a theoretical question. could the national security council do that? did they agree with the cabinet in the way was described earlier? and in a case like this, allows all the relevant ministers to consider all the ramifications of the situation on a regular basis by the prime minister. so the national security council meetings we had in recent weeks are able to look of the deployment of military assets but also able to hear the intelligence reports and also able to issue about the diplomatic response in the next two days when going to european meetings. we are looking for better than

ambitious european approach to the region in the future not only libya but also egypt and tunisia and through the nfc structure, the end game on those economic means and what we're doing now? >> that sort of chemistry is backed up by something at the end of the day meeting with instruments. >> may i just make a comment on what you just said? to the extent that we're not able to deploy british assets can i suggest we reduce those assets that we can deploy? >> it would be a tight race. [inaudible] >> in north africa for your attention to my registration in

the gulf. do we now have something concrete for that region given where we are today none of us have seen that. do we have a concrete strategy for that region and if so could you articulate that? >> we have to do it with our international partners to be effective and this is very much top of the agenda in brussels and european council back at the end of the day we do think recent events in north africa and the middle east require a major change in how europe works and we ask other international partners and so act as a magnet for positive change in those

countries without being patronizing toward other societies or nations, respecting their different cultures and traditions, we need to create the equivalent of 0 is not the same, what we did for eastern and central europe after the end of the cold war. clearly membership of the european union and that was a magnet that put them in the direction of being very positive of greater economic openness and political freedom and democracy. it is the equivalent european strategy. backfire eliminations across the world to look at national financial institutions like world banks that helps to encourage reforms that will open those economies in the systems by setting foundations for european funding. the european union produces the best results to its neighborhood but not in a coherent way by

offering market access to the european union, offering more formal relationships with the european union so the development is what we are looking for believing as we do that we should be optimistic about the opening of this greater democracy. political freedom as the prime minister said to the kuwaiti parliament but there are great risks and this could still go wrong if these countries turn into stable modern democracies it will be a great advantage. if they don't then the adaptable posturing in the national security will be even more essential. >> i remember the parliamentary assembly. the speeches nadir was able to

make, decisions -- [inaudible] >> one of the things i would like to talk about it is used and some time actually reviewing previous documentation. i am intrigued because everyone talks about salt, what was going to happen in the middle east. . yet others actually looking at strategic trends programs in different projects that came out in 2009. and it says solution networks will become important features in future conflicts. a conflict in one area might lead to conflict in another. in effect creating local joint operational area.

we new social networking on that capacity to communicate was a risk. >> we can look at that. that is a very correct assumption. as you say a global network, knowing it would appear indonesia or egypt was a very difficult to predict. even looking at intelligence that we had in hindsight it is difficult to see what a particular point was. where we can do is look at the analysis you mentioned and to see in the areas where we have seen this become a real

phenomenon or how the demographics might give us a pointer to where it might happen again. what do we know about the age of the population? access to these networks? what we know about the levels of education which might give us a pattern that might give us some pointers to where it might be likely to happen in the future. >> you did tell the committee, every single day -- we have a very poor record in predicting where conflicts will occur and what conflict will look like. >> that is probably repeated in europe. >> we're certainly seeing the opportunity -- >> it is also true in paris and rome and washington and virtually every other major country, what is going to happen when it did.

not able to predict conflict at the precise dates and times and places that we will be doing a lot more of. >> it was predicted often here in bosnia. but how can we know the correct decisions have been made? what gives you the confidence that the national security strategy -- putting in place for the associated platform that they are actually going to make sure -- >> we choose the correct posture. in the budgetary of love that was available, we would change over the time to look at it anyway. had decided to go for a burn policy and pretend that we would not be affected by events elsewhere, we could retreat into our show. the proper response to what we

have seen had we decided we no longer require what we have the we should be investing far more in sources able to become increasingly in operations in afghanistan. that would have been the role of choice and to decide we do get to have assets that are widely deployable given whatever financial unbelievably have is the correct decision and the essential judgment was a threat. >> given the areas of concern where we are with that, would extend to you think there's a great chance given what is happening in north africa and libya in a more painstaking way

the channel between nato -- du think we could adopt a different position, different posture if the leadership role and constraints hadn't been in place and financial constraints described in the primary national security? do you think we would have behaved differently if we were not in the situation we're in now? >> we required was available. we are ahead of many other countries. it is fashionable in the u.k. to see how far we were behind other countries the week had been evacuated hundreds of foreign nationals and many more foreign nationals with each movement out of our assets that we had any evacuating. so we have been doing a lot of heavy lifting for other countries in this operation. >> not affected the situation from now on is largely extensive with the consent around the

future. >> i want to make it important that the u.k. is not people who do think not only would we be capable of our own citizens but capable of many other foreign nationals out as well and the way in which the u.k. has increased it is rather different. something we should be very proud of as a country. when it comes to the events of the future, nato has a meeting tomorrow. we will evaluate all we options and shake the contingency regulations. >> with the position be any different had would not have the decisionmaking on that? >> we are acting within collective constraints for russ and alongside our allies is the way we wanted to international security which is why we insisted the prime minister insisted so early that nato in

the forest, and i am not sure nixon would have been in this position in terms of contingency planning. tomorrow we will look as a grouping. the key for nato is if the scoping is done and it is clear what assets need to be used, what is the political appetite across the big novembers for the deployment of those assets because it is a serious question. having the assets, if the political will is not there to use them if leaves nato collectively disadvantage. >> i wonder if i could take back the place on the moment. we made a very strong and accurate statement that we have a long history of being unable to predict in any meaningful way what conflict coming up the. do you think that is a case for

reviewing the firmly entrenched system of working and deceptive planning assumptions and the more fashionable model which is balanced capabilities where you get the impression the americans are in the process of looking towards their own different scale, their detailed time baited for the decisionmaking against the background of persistence failure to see the problem? >> the assumptions effect of the guidelines that we use and what we think we need to do with these forces. the very clearly taking on the adapted posture, what we have in effect said is we balance the capabilities in the u.k. but decided not to go to one extreme or the other in terms of shape of the arms forces we have. they are largely budgetary issues within that in those

parameters set by posture. >> allowances and things like that. [inaudible] >> the security council is part of that, the coordinator has been affected. sometimes more than one week. the discussion is very irregular so coordination is focused on that. it is also very strong outside

the environmental basis. the colleagues, officials. officials work and productively, the department to do so, i think for instance the national development -- relations and working between the foreign office, for members that hedge faster. and the department of -- officials say that. and it is across departments. the responsibility in each

department. to make sure we are supporting this overall strategy. we have been given to questions and what is happening in each of these departments. >> you speak to one another. >> outside of this, various departments. what really struck me is we have gone through many discussions at the national security council on a wide range of issues that you cannot in advance of the foreign office, not operating as a series of department 0 -- we genuinely have at discussion about how we want to look forward on any given question. and what resources we have available to us. at that stage, people talk in terms of what their department

can contribute. without being there i can't adequately -- r i am enormously impressed by the extent to which having this form of meeting and having it continue and be discussed many things makes it -- people stop thinking of those. they don't read out briefs from the department. they really do engage together as a manifestation of the government to try to solve a national problem. [inaudible] >> talking probably helps put the last word together on the position in five years of running up to the election. no doubt at all in terms of the national security total has made it much clearer in my department but why they should be so will

join up, and our for example on the humanitarian issues in libya which my department has been leaning on over the last couple weeks, the work in which we do -- we are joined together with the foreign office, extremely important to getting across britain's aims in that effect. >> i want to ask we should also point out that in the future plan of engagement around this process, the chiefs' meeting with other departments attend, that one forms the thinking of the military ahead of the nfc and other departments, where we have the of bogey among the evening's for operations and risks, that is also attended by other departments so there are number of other bodies cross

referencing and feeding in the true sentiment on real time basis so it is not just the nfc officials. you have a whole range of meetings across department. >> this is a princess question addressed to you as an outsider in the cabinet. the nfc meets for an hour on tuesday morning usually. why it doesn't it meet? because presumably the things you are dealing with are important issues with good buy in from the rest of the cabinet. why not meet an hour before the cabinet meeting? >> the nfc doesn't only meet, it is also met has said earlier on occasions more frequently. precisely in order to consider things that might be referred to

the cabinet. and there have been frequent occasions on would like to recalled the exact number but in which the following week the decision was arrived at end being discussed at the cabinet of the following week which depends on circumstances, quite soon enough. >> that is a week later. i put that to you. [talking over each other] >> i have given -- we thought about it for a long while back. it is useful for the results of one meeting to be before there's a market -- if we move directly we find sections to attend

cabinet meetings. if we persuade us to move us back, it be some way back and make very much difference. >> the abilities that are needed in the national security strategy. and intervention, they are not necessarily on the platform. >> we balance forces has said. p. environments we have to be able to have forces capable of

expeditionary capability. the capability to reflect policy. and the maritime missions, the ability to support those missions. assets to give us capability when required to support expeditionary and other missions and have sufficient numbers and for the defense -- it is a white balance across -- we put the point to -- this why we went for posthumous fund and the too heavily. and heavily towards other types of assets. and a range of things and the

ultimate threat to take nuclear deterrence. >> the sense of strategy to take into consideration. >> we just published on looking at it. >> we are deciding that -- a nuclear deterrent. we have to have the technology backing up on encryption. there's a growing global debate to internationalize the personal not least because of the defense --

>> we work together. the question in the forthcoming paper, we are being enormously clear, both of us, that it is defense requirements which should drive this process and not the industrial department. if there is a defense reason for this capability then we should invest. but we are not allowing ourselves to be driven by the concerns, however valid in their own right, for the national economic duration. those considerations may extend in thinking about -- dealing with defense procurement we have been clear minded that this is driven by these requirements. >> do you have criteria and

methodology and overall risk assumption on which capabilities are being met? >> the committee, before, a single tool which we looked at when making decisions about assets in general. as i explained we have a single chief in front of us, the second call had the cost of 5-10 or 10 plus, the capability implications of the decision, what capabilities did we currently have that we have been diminished lost with the result of changes being proposed to look at and is operational implications that we currently brought in that again we might not be able to do, generation requirements because if we diminish the capability, how quickly could we regenerate the

capability that remain the key element. and the real world risk is the direct answer to your question because we cannot have the balance of forces done on an abstract basis because we do not have the budget to buy everything you need. it needs real world risk. very useful tool because it gives us changes in real time against which to measure the change we might need in the future. >> now i'll remember. you gave us some detail in june of last year. are am trying to pick up a bit of speed. i know that people have a lot of things to get for a. both members of the committee and the witnesses.

>> i would like to clarify. that october committee, capable decisions were based on project risk. how is accepting risk defined and who defines it? the question of the involvement of many of these decisions, and -- [talking over each other] >> we look at the evidence that exists about what capabilities that directly affect the u.k.'s interests of. we need to counsel them on where we need to go essentially to get ourselves or our interests. some capabilities do not threaten other countries or other capabilities. we might satisfy -- i gave the example before of why we look for example at other vessels in the gulf.

it is possible to take about because the real world risk was too great. the risk may change. iran may become a benign paradise but may continue to threaten vital interests in which case we need ships in the gulf. >> my question is about your thoughts on the main driving force is behind our alliances with other countries? is it primarily diplomacy or getting access to military capability? could you also described to us or clarify which one of your departments takes the lead on establishing those alliances? >> the driving factor behind allianzs of national prosperity and national security. a different combination and different alliances talking

about the nato alliance and national security alliance. the european union is more direct to national prosperity the personal relationship with the united states is a powerful mixture of the two. the elevation of our relation to countries of latin america or southeast asia is more directed at prosperity but it can lead to defense cooperation. elements of cooperation. these factors from one case to another, one thing to node in your examination of the national security council is a lot of the subcommittees of the national security council, and the emerging powers committee. which is quite heavily prosperity focused. even though it is under the national security council, a great deal of the work of the

council is pure security and it is defensive in the sense we have been discussing it for most of this discussion but it is important to be developing the national international relationships which are improving and may be key to our security 20 or 30 years from now. so we oversee those relationships including collaboration in higher education and diplomacy in business department relationships through the nfc committee. all of these things are factors facing alliances and international relationships. >> the whole approach has been to create a multi layer approach. bilateral relations, which are political and military and economic that we try to develop

new bilateral relations with countries who feel there's a strong relationship in india for different reasons because the very important strategic geographical position supporting energy security because of the nato partner. and the membership, wanting to elevate those and then we have -- improve some of the areas like nato which i agree is left. too slowly on occasion and effectively we want to have as many lenders -- levers that government can pull as possible including getting some life back into the very neglected relationships that we had for

example in southeast asia. the affected mechanics are there. >> in terms of which department takes the lead. >> international alliances and relationships, they to they diplomacy, the foreign office but one of the advantages for the national security council is we are able to put these together. we are able to say it was a bilateral relationship. we work with them on development together and extend that. we are going to upgrade dramatically. we will have a stronger collaboration between -- whenever it may be. our objective has been for foreign policy to go through the

entire government. those departments are executing that not just -- >> creating new structures to enable what is happening but we are creating new structures to make sure we are maximizing for our foreign policy, not just defense relationships. >> the defense assets for international security and prosperity agenda. it is important. we're working in the foreign office to develop a defense engagement strategy which recognizess the defense capabilities that influence far beyond the military attacks and

make sure we maximize the international priority. that is what we will be doing from now on. >> to enlarge the picture and illustrate how related these things are. the relationship that was developed normally, it might see that the relationship with norway have nothing to do with the middle east or north africa but of course it does. deepening the relationships with norway and securing energy as a result of the relationships may have a direct bearing, and in north africa. >> how will the effectiveness

defected? >> that is the number of levels nhithat is the number of levels ineparl ctra o ' is about to -- or we have ranged discussions on procurement where we have duplication for the moment which we might have in

tough financial times to reduce the number of the doctrine or trading exercise in terms of future procurement. >> in terms of assessment, the review in future years for the national security strategy is an ideal vehicle to review the assessments. >> you mentioned in norway, with further alliants, the report on the french alliance. >> the german system as a few weeks ago to see the areas to go together. we did not have a treaty with

france because we thought it would be good to have a treaty. there were strong reasons in terms of capability and that made it an actual partnership. we want to seek to have treaties of that bilateral nation with other countries just to have them. the value of -- that doesn't mean we can't have cooperation with other countries. the summits we attended, of the bilateral defense relationships with bilateral relationships inside a grouping was some sort of crime. no front -- nobody thought a strong anglo-american relationship -- why should be with other countries, other organizations? >> finally, how do you establish

the alliance with the -- and [inaudible] -- what is the implication of a new alliance with them? >> the longest average relations have done very well, adaptable posture in meeting the range of threats we identified as a national security strategy. the defense secretary was talking about the meetings we had in australia. a relationship that we think has not been given enough attention by government in recent times and so we agree for the first time the meeting of the defect and foreign ministers of the u.k. and australia in australia. we did that in january to discuss the entire global picture together and identify certain areas where we identify

cooperation, defending ourselves in cyberspace is an area to observe in australia for the capability to do a great deal together. the refreshing alliance fits very well into this strategy just as the building up of new stronger alliances, an example of nato members and existing allies and identifying also based on the range of threats we face for the region's -- >> also with an alliances the ability to provide energy like the northern group, between the -- another area where we will focus on particular areas of concern to us as it might not be

a concern to the wider grouping or whatever. it allows us to have a focus recognizing the geographical position that needs to be attended to and we sometimes forget to look beyond and in some cases the influence where it leads. >> the final question relates to money. >> i will be as brief as i can. there is so much happening at the moment. it is the reorganization, hampered for the development of the delivery. >> we have to have reorganization if we are going to get value for the money in whatever budget is set. we have to get that -- have better management and real time

control of defense budgets. >> we're trying to do change at the same time -- is there a paradox? >> i am not trying to start a revolution but it requires to change -- [talking over each other] >> it is quite difficult. we do require a change to be on the ticket. there is no real accountability for a 20 meter program with 80% of the program budget. it is incredible. what we send out two weeks ago, programs that have 40 year reviews, with on time and on budget or we bring in the program team and if we are not happy we will publish the

program to see which programs might be at risk in the future. interesting to see stock market movers and i think it is essential that we get tight control to talk about -- waters will froze over again. we keep what we take in increasing efficiency in the department. we must bring the changes. >> it is revolutionary. you would want something for your revolution. so who is it with administrative events to make sure? which particular part of the ministry of defense will drive this through? >> those particular project, that is my responsibility. there's something in the ministry of defence which should

be controlled centrally, which should be devolved as part of the reform and something that needs to be controlled is the real time budget. it has been gripped and that is why it will become -- >> seriously, good luck. >> for that, in the past you told us that the government -- about thirty billion, could you clarify the real commitment to associate the commitment of the most? >> it was the difference between what the department planned to procure and the resources if you assume flat growth between 2010,

and 2020. >> this was planned procurement. how much of that would you support on a contractual basis? >> the way this worked with greater proportion of each year's but it was committed to smaller and smaller proportion left of what we do. that stands at 90% of the budget committed. before we were able to look at the planning rights. has to number of projects that have begun for projects that will come through that, the number of young sites because of the scope. under that, be stripped out a large proportion, we are still involved around 11 and i would not wish to see anything

lifetime had. >> i wasn't trying to do that. 90% of the $38 billion were committed. >> very heavily committed. >> that allows -- >> a limit to what we have in discretionary spending. [talking over each other] >> 90% above that -- >> of this year's budget is already committed. [talking over each other] >> 90% is already committed. >> it was $39 billion which was

38 in the defense. okay. >> how much of that $38 billion was contractually committed? >> i couldn't give an actual figure but i will get the figure. there is a huge ability to reduce a large proportion of that but my guess is $38 billion, something like a ballpark figure of $9 billion. >> the problem on that -- >> we have taken a huge proportion of that as a result. when we are through that, back to the green paper turtle make that shipment available to the committee because we have become quite apparent.

>> current spending round by the minister of defence, agreeing to cuts, specify those cuts that you are committed to something over the next four years turtle across portion taken? >> through the rest of the planning rounds. it was always supposed to be extremely difficult to deal with the plans to overspend very quickly and we have to work our way through that. through a number of areas with a decisionmaking with regular forces or the basic review of what we do. a lot of these will be through the planning runs. >> if is over the next 4.7 on savings in the current spending

round, you have a portion in terms of the cuts. >> that is dependent on what we are discussing at the moment. for example, about $500 million of that money will be the money we might expect to control premium sales which are not -- what we might have expected. >> if i were to say that level is 1 million a round, we have to look at the end of march or something like that. >> that depends on what is available on the other side. if we were to have to close a gap in farley if you look at the period of missing receipts, the increased cost we had and so on,

it has been something that we will take to the treasury within two weeks. >> you haven't just to be clear on this, it is ridiculous. >> i would never dream -- >> just ask a question. the defense industrial strategy, this talk about -- i don't know about the spring or it is july or march, is there any projected date for when these things will fall? >> we think it is late june or early july. long spring. [talking over each other] >> over a planned commitment to

procure the consideration in the house, of the plan and in my head over time, how it is supposed, how much is a planned procurement actually signed contract is this what you are coming back to, the aspiration will planning? it would be helpful to see the difference. >> absolutely. this is one of the things i am keen to ask. it seems to me exactly like the implication of your question. there are projects begun where money goes into alignment with budgetary light. for example, bose projects in the hope the money will become

available is that what the department means by it? what i love to ensure is we do not spend money on any program unless we are sure the budget alignment will be there but development and procurement because its seems to work we are doing going into this is to see where it is beginning to spend money in the hope that we continue the program in later years. that is what we have been seeing with overcommitment of the budget to the point where we are now and suffer the break. >> the problem i think is we are using this without any great degree of clarity as to what is this which madeleine moon would like to buy and what has been

committed. do you feel you should now be able to produce that clarity in public? >> what we intend to to do is send out at the end of this process in case we are actually committed to this period. [talking over each other] >> it would not be substantially less. we are looking to see where to get out of future expenditure. we do not believe that will ultimately get to fruition. >> i you not able now to give any answers in relation to that thirty-eight billion pounds? >> depends on what we ship out of it. >> depends on what is committed. how much is the aspiration. >> it is difficult in the current definition department uses to do that and there's no

real money in future programs or state programs. that is what we have to ensure we stripped of. we have to make sure we have an aspiration whiff of the real budgetary line or a wish list. >> is it difficult to do that? is thirty-eight billion pound figure has been justification for some of the defense decisions. how do you justify that? >> had we gone ahead with all the projects in the pipeline of complex weapons or other areas of projects that we would have had we assumed legal spending between now and 2020 we would have had what a budget of over the last period more budgetary from the treasury.

that will lead us every year into a more committed budget that ever left discretionary spending. >> are you in a different position from any previous incoming government in that respect? >> we are in the same thing. these are practices which have gone on for many years pushing budgetary costs to the right and this meant that every year the budget is more committed than the previous year and we have gotten to the point that is unmanageable which is why it has reached crisis point. >> i suspect, for this is an issue we will need to come back to. we will eventually need to ask you to come before us again. >> always a pleasure. it will be a pleasure. >> before we do there is one further question. i would like to put this.

we know that dr. cox has a strong personal view that he would like to see an increase in real terms in defense budget as from 2015 because he is upset. we know from prime minister has said the same thing. is it critical? financial security, working on the basis that it will have? >> it will not surprise you that the national security council has the interest in the prime minister. and the prime minister on record having to turn them off in a position that we might answer that question. my own strong view is that this will require a year on year real term growth in the years beyond 2015. that is what he said. >> you find this credible?

>> i certainly do. it is not only credible but something that is very powerfully -- >> is it government policy? >> is the view of the prime minister. it is a strong view. >> let me turn that -- >> let me explain the difference. is not possible for the machinery of government to said its expenditure position across a long range and has been reviewed. that is the structure of our machinery of government except expenditures according to those, setting the pattern for four years. it does not stretch to 2020. i do not know of any government that could do that. >> is a policy to replace -- >> we are engaged in replacing fraud and and that is our policy. >> why can it not be government policy to increase spending on defense from 2015 onwards?

>> there is a difference between the decisions you take to spend money now -- [talking over each other] >> there is some spending going on. to be of great importance spending that money to maintain capabilities we need to maintain and do what we need to do. there is government policy to maintain and replace, expenditure going on now and that is the policy of this coalition government. the prime minister is facing his personal view as the leader of the conservative party about something which will conform to a subsequent period and the government then in power to decide finally and which we will begin presumably to make some decisions about at this point. >> we