Good morning, I would like to thank RUSI for giving me the opportunity to start setting out the reasoning behind the defence proposition for the Integrated Review and the MOD's direction of travel from this point.
When last month the Prime Minister called me to confirm his determination to deliver a vision for Global Britain, and defence's role in it, I knew he had created a real opportunity for us to not only deal with the legacy of previous flawed reviews, but to embark on a deep and far-ranging programme of reform.
The record multi-year settlement, especially in such challenging economic circumstances, is a recognition of him by the dangers in the world and a determination to properly fund the UK's ambitions - this is a vision he and I have shared over a number of years.
For defence is one of Britain's greatest exports - not just British-made equipment but British know-how and values. It is also one of the biggest innovators and employers across the whole of the United Kingdom.
Whichever way you cut it, the Prime Minister's important decision to make an exception for defence, was a bold and sensible move to ensure that defence can deal with its pressures and create the "headroom" to modernise. I was delighted that the case I have put to No10 was not only shared by the Prime Minister but enthusiastically embraced with the funding to match.
From the day I arrived in the MOD I recognised the need for change and investment.
The consequences of decades of SDSRs that were over-ambitious and under-funded, were fast coming 'home to roost'. All of us have got used to SDSRs that looked good at the press launch but faded by tea-time.
The decades of funding deferrals were about to hit the buffers. Bogus efficiencies, saving targets, hollowing out, and the lasting impacts of fighting the Iraq and Afghanistan conflicts are all things that continue to drain away precious resources long after the political leadership that directed them have exited the stage.
I found a Ministry of Defence that, actually, had little confidence in itself, and was accustomed to living hand-to-mouth.
Our desire to please was replacing our mission to defend.
As a former Security Minister who knows the threat inside out, I feared defence had lost touch with it. Instead of 'threat' driving us and our mission, it was infrastructure, HR and annual savings measures. The latter is of course important but secondary to the mission of defending this great nation from evolving threats and increasingly emboldened adversaries.
And make no mistakes we have adversaries. From terrorists with chemical weapon ambition, to hostile state actors, this country, our citizens and our values are all targets.
And as I witnessed first-hand over the last few years, these threats are not scenarios in the minds of our planners. They are actually happening.
We have a tendency in the West to divide conflict between war fighting (the violent activity of a 'proper' so-called shooting war) and the sub-threshold (everything before the shooting starts), when in fact today's conflict is carried out through typically non-violent but undoubtedly hostile activities.
This division might give comfort to our 'rule of law' approach, but it drives a static war and peace disposition. This makes us deeply vulnerable to those that don't play by the same rules, especially below the threshold.
The developments of our adversaries in new domains and their investment choices aren't by accident.
They are a result of a studied approach to our strengths and weaknesses. They are fluid, we are static. They use readiness, innovation and presence, while we remain entirely predictable in our processes and posture.
In truth they are masters of the sub-threshold while we tie ourselves up in self-imposed risk matrixes, contradictory legal frameworks, and often bureaucratic barriers.
The aftermath of the Salisbury poisoning reminded us of two things. One, the effectiveness of responding through a whole of government campaign. And two, that there are state adversaries prepared to go way beyond what we assumed were the accepted norms.
Across the world these accepted norms are being junked by our enemy.
The widespread use of cyber, organised crime, electronic warfare, proxy fighters and disinformation can be seen on nearly every continent.
In preparing for this speech today I searched for examples of our own history of the consequences of failing to modernise defence.
There was, of course, a multitude of quotes from officers dismissing new technologies, or failing to recognise that the battlefield had changed before their very eyes.
If contemporary newspaper reports are to be believed and I would caution you to take it with a pinch of salt:
In 1921 the First Lord of the Admiralty, Lord Lee argued for the abolition of the submarine. He was believed to have said 'it had not proved an efficient weapon on defence.'
And many will be familiar with the reported quotes of Field Marshal Haig who argued that the value of the horse would be "as great as ever. Aeroplanes and tanks are only accessories to the men and the horse, and I feel sure that as time goes on you will find just as much use for the horse - the well-bred horse - as you have ever done in the past."
There are, in fact, too many examples and while some of the quotes I use may exaggerate those historic failures, the sobering fact remains that many of us are still not leading the way, but watching others do so.
Take for example the Turkish UAV, the Bayraktar TB2. Its use in Syria, Libya and elsewhere has been responsible for the destruction of hundreds of armoured vehicles and even air defence systems.
The roots of these drones are born out of Turkish innovation. Prevented from gaining access to exquisite foreign programmes they did what we used to do so well - they innovated.
The TB2 and its accompanying munitions combine technical abilities with an affordability that means their commanders can tolerate some attrition while presenting real challenges to the enemy.
Another example is the investment by China, Iran and Russia into next generation missiles.
We should not underestimate the impact of the accuracy and range that these weapons now have.
Only last month Russia tested the Tsirkon hypersonic anti-ship and land-attack missile, which can travel at Mach 9, outranging and outpacing even its predecessors and creating new challenges for our counter-measures.
As CDS often says, the battlefield is becoming more expansive and lethal, so future operations will be all about hiding and finding.
Even today, in Ukraine, Russia's use of traditional artillery coupled with UAV forward observation has created a lethal, and efficient deep fire affect - if you can be found you can be killed.
None of the above means we will be abandoning war fighting at scale nor the use of armour - old capabilities are not always redundant, just as new technologies aren't always useful.
But I do believe that we are no longer leading and innovating enough. We are in danger of being prepared only for the big fight that may never come, whilst our adversaries might choose to outflank it even if it does.
The threat has moved, and we must move with it. Just as we are seeing constant competition stretch out across the globe, we must be constant in our self-criticism and challenge.
And we must do that in conjunction with our allies and friends because - as the second biggest spender in NATO and a major contributor across all five domains, plus of course our nuclear deterrent - we have a responsibility to play a leading role in its own transformation.
We must work with allies to make the most of new technologies; improve integration across all domains and throughout the spectrum of conflict; and as the NATO Reflection Group recently highlighted, recognise its essential role in cohering how we, as allies, handle this era of great power competition, staying ahead of our rivals and not waiting for them to set the agenda.
The steps to restoring such UK leadership in defence must start with ensuring we are a credible and a truly threat-oriented organisation. We must always challenge ourselves to meet the threat and then to exceed it.
We must ask uncomfortable questions of ourselves and we must learn from conflicts - both real and anticipated.
So, the first step in defence reform that I am taking is the establishment of a net assessment and challenge function in the MOD.
The Secretary of State's Office of Net Assessment and Challenge (SONAC) will encompass war gaming, doctrine, red teaming and external academic analysis.
It will focus and enhance existing efforts, work closely with Defence Intelligence and look across all areas of defence, especially doctrine and the equipment choices we are making.
I have asked Air Marshal Ed Stringer to advise me on its development. Ed's background in joint force development and academia makes him excellently qualified to help establish it.
Because from challenge will come change. I want to see defence policy that delivers my three priorities for the department, becoming threat-focused, proactive, and sustainable. The Ministry of Defence under me will be:
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well-informed, clear-eyed about contemporary conflict; laser focused on the threats this nation faces, and self-aware about our preparedness to counter them
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it will adopt a proactive posture, with our forces more forward and present, more busy and assertive. A return to 'campaigning' and the ability to operate on both sides of the threshold
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and perhaps most significantly, it will be sustainable. We must constantly strive to match our ambitions to our resources, to be more transparent in our equipment programme and ruthless in our decision-making
Too often we cling to sentimentality when we need to explore alternatives.
Sometimes it will mean quality over quantity or the good rather than the perfect. Or simply letting go of some capabilities.
Managing that process and fielding the capabilities required for tomorrow will require the open, honest, and collaborative relationship with industry for which we have spent so many years advocating, but also failing to achieve.
And delivering more modern, active, and effective armed forces is not just about keeping our adversaries at bay, but projecting our national interests and promoting our shared prosperity.
So we have an opportunity not just to transform defence but to create thousands of highly skilled jobs at home; harnessing our advantages in science and technology, research and development; driving exports and generating prosperity; and enabling us to build back better and level-up across the four nations of our United Kingdom.
And if there is one policy that strengthens the UK in every one of those regards, it is shipbuilding for the Royal Navy… although you would expect me to say that as the government's shipbuilding tsar! __
But to the many experts watching this you will know that tomorrow's settlement doesn't relieve our more immediate financial pressures. You don't get out of a decade of deferrals and underfunding overnight.
Some tough choices will still have to be made. But those choices will allow us to invest in new domains, new equipment and new ways of working.
I am conscious that if we are to achieve our aim then we must harness the skills and potential of our people. I want a culture in defence that innovates more, embraces diversity, and allows more specialism to flourish.
So we should build upon the excellent work already under way to modernise ways of working and improve career opportunities.
In the autumn the Chief of Defence staff set out his plans for how we will operate, through the Integrated Operating Concept (IOPC).
And next year, complementing the Integrated Review, we will publish
