Briefly: Strike three may signal that Winston Peters and New Zealand First are soon to be out for the count. Beforehand, and despite all the sins, evasions and ‘ mistakes’ on NZF’s record regarding its non-declaration of political donations, the two investigations under way did seem very unlikely to produce a definitive outcome. That’s because the privileges committee still faces a dire choice between Glenn and Peters as to who is the more reliable/flakier witness, while the Serious Fraud Office probe seems destined to prove only that the money went where it was supposed to – long after the statute of limitations had expired on NZF’s outrageous failure to declare it.

However, the possible third investigation – by the Police – looks like a quite different kettle of fish. In 2007, NZ First filed a return to the Electoral Commission showing "nil" donations over $10,000 - but Spencer Trust trustee Grant Currie has said that the Trust made an $80,000 donation last December. This failure to declare it by NZF can be prosecuted. According to the Herald, the $80,000 went towards helping to meet the $158,000 wrongful spending by NZF at the last election.

A Police investigation into NZF’s failure in 2007 to declare would cast a very long shadow over the post election negotiations -= clearly any governing arrangements in the interim that involved New Zealand First would be extremely unstable. Helen Clark may soon need to join John Key in ruling out any post election dealings with Peters.

Defence So, just a couple of months short of the election time, the Defence Force annual report of 2008 has suddenly become a platform for media revelations that New Zealand’s armed forces, to quote one headline ‘can’t sail, can’t fly, can’t fight.’ That will be news to the hundreds of our armed forces currently deployed overseas, and to our allies in Timor and Afghanistan.

It looks like – and is – a media beat-up. Surely an alleged crisis of such magnitude would have been foreshadowed say, in last year’s Defence Force annual report ? But no. Last year, with one further Budget still to be wrung out of Miuchael Cullen, the top defence brass were sounding relatively sanguine about the state of our armed forces. In

the 2007 report for instance, Chief of Defence Forces Jerry Mataparae was saying how the New Zealand military has “earned international respect as providers of effective military capabilities.” Moreover, the steps being taken the previous year to address skills shortages and staff attrition were being claimed then as successes.

Yes, there are current staff shortages in Defence, equipment shortfalls and ships failing to meet their target times at sea. The situation in the armed forces - just as in health, and education – is not ideal. For one thing, our military resources are currently stretched by the fact we have got troops overseas in several locations at once. Yet compared to the cuts made in defence funding under the previous government during the 1990s and in contrast to the decrepit APCs deployed during the Bosnia campaign – to our embarrassment, these had to be towed back to base by our British allies - the situation seems relatively flash.

Nor is New Zealand the only country where military chiefs are struggling to train and retain skilled staff who are in high demand elsewhere in the economy. Only in March of this year, the Australian newspaper reported that Defence Minister Joel Fitzgibbon “has inherited a recruitment crisis across the Australian Defence Force”. As a result, the newspaper went on :

Only half of Australia's submarine fleet can be sent to war, because of a critical shortage of qualified submariners. The crisis has left the Royal Australian Navy with only three full crews for its six Collins-class submarines, severely undermining the effectiveness of one of the nation's most vital and expensive defence assets.
"It's becoming a ghost fleet," said one submariner, who asked not to be named. "We are losing our crews - it feels like the Mary Celeste."

Nor is this the only problem facing the defence forces across the Tasman. The newspaper continues :

“The submarine crew crisis comes at a time when the Navy is unable to send its four FFG guided missile frigates to war because of a bungled $1.4 billion upgrade…Last week's decision by the Government to axe the troubled $1 billion Seasprite helicopter program has also left the navy's Anzac-class frigates without a vital capability designed to protect them from hostile ships and submarines. “

From that perspective, the problems identified in the 2008 NZDF annual report pale by comparison. Those problems need to be seen against the backdrop of the Defence Funding Package (DPI) under which $4.6 billion in new money has been allocated for the decade from 2006, to develop military capability and organisational capacity within the NZDF.

So, what are the problems ?

1. The Army. The Army has been the focus of New Zealand defence planning ever since the Quigley defence review of 1998/99. The 2008 NZDF Report says that while land forces are "partially" prepared for low level conflicts, the Army was not equipped to meet higher threat situations. "Deficiencies command and control, firepower, and compatible protection and mobility for combat service support elements would impair effectiveness in conventional military operations, and the more challenging peace support operations," the Report says.
Right. Yet “not being equipped for higher threat situations…in conventional military operations’ is hardly a pressing problem – given that Mateparae says in the same Report that so such threat exists. Furthermore, Mateparae describes the nature of the modern conflict threat as being “ asymmetric”- and therefore NOT subject to conventional military operations.

Essentially the defence threats we can rationally plan for are ones in which high tech/expensive military platforms are not particularly relevant, since the foreseeable threat is likely to come from smaller forces, using relatively unsophisticated weaponry. Therefore, investment in state of the art equipment at a major conventional warfighting level across all three services would not only be ludicrously expensive – it would make sense only if we seriously planned to rejoin old alliances and fight in conventional battles elsewhere in the world. If this really is the secret agenda of the NZDF and the Defence Ministry, the public needs to know about it.

2. Airforce The airforce, says the Report had "insufficient personnel" to meet air and ground crew levels and it was only partially prepared for complex maritime air operations. Yet as the same report concedes, the C-130 Hercules upgrade is taking place, and will extend the service life and improve the avionics on these aircraft.

True, the Report does cite and then downplay this advance. It says : "Despite the modifications, the engines, propellers, and some other systems will remain as possible sources of unservicabilities (could not be fixed)…" Translated, this means that the Air Force is getting the upgrade of the C-130s that it wants, but other ( unspecified) problems could “ possibly” remain – in situations where the Air Force would only be ‘partially’ prepared IF it should ever need to conduct “complex maritime air operations,”

And how likely is that? Well, they are not envisaged during the next decade…. and it is unclear what these ‘complex maritime air operations’ in our region could possibly be. Major anti-submarine warfare ? Attacks on carrier fleets ? Or some other flyboy fantasy?

The 2008 Report also cites problems with the Iriquois helicopters. "In particular, the performance of the Iroquois in bad weather, at night and in hot and high conditions is unsatisfactory.” Which is not an enduring problem, since the Iriquois replacement is in the process of being supplied. As the Report itself says in virtually the next sentence : “The NZDF Medium Utility Helicopter Project (NH90) will address these issues.”

While critics still wax nostalgic about the Skyhawks, the Air Force has not gone begging. It has scored the C–130 Hercules and the Orion P–3K upgrades, refits of the two Boeing 757 air transports, the NH 90 helicopters, and a $129 million upgrade of facilities at Ohakea Air Base as part of the ten year phase out of Whenuapai and consolidation of operational capacity at Ohakea. Five Augusta–Westland A109 light utility helicopters, a flight simulator and spares support are also being bought. These choppers will provide air transport, search and rescue, aero–medical evacuation, disaster response and surveillance and counter terrorism support. Again, this level of investment in new and upgraded equipment hardly qualifies the Air Force for poverty row.

3. The Navy. According to the report, few Navy ships managed to get out to sea as much as planned. The HMNZ Endeavour spent 50 days at sea out of an expected 100 to 120 day, HMNZS Te Kaha 99 days out of 140 to 160, and the HMNZS Canterbury only 95 days out of 140 to 160.

The reason being : a lack of personnel and "equipment and capability issues". The Navy also did not receive two offshore patrol vessels and four inshore patrol vessels during the year in question, when these had been expected.

Again, some of these complaints will be addressed within a year. In the 2008 Report, Mateparae himself spells this out :

For Navy, the first of the offshore patrol vessels (OPV) – HMNZS Otago – and the first two of the inshore patrol vessels (IPV) – HMNZ Ships Rotoiti and Hawea are nearing delivery. They will join HMNZS Canterbury that was commissioned in June 2007. The rest of the Protector fleet,
the second OPV, Wellington and the last two IPVs, Pukaki and Taupo, are expected to enter service during 2008/09.

Preparations are also underway for the upgrade of the two Anzac frigates. The upgrades include three projects – the close–in weapon system upgrade, platform system upgrade and the self–defence upgrade.

The Navy, in other words, is hardly being neglected. It suffers from the shortage of skilled maintenance staff faced by military services, worldwide. Overall, despite the current high rates of staff attrition – and those chronic and unavoidable shortages in key skills areas - the total number of personnel in the NZDF is at its highest level in seven years. Nor has everything hinged up on the ten year $4.6 billion DPI programme of investment in new equipment launched in 2006. Since 2002, the government has allocated $4 billion to replace outdated equipment in all three arms of the NZDF.

The Staffing Situation Routinely in New Zealand, the armed forces staffing situation is an index of the nation’s economic health. During a recession, the NZDF soaks up labour - and then faces personnel shortages when, as for most of this decade, the economy is performing well. The results are now being felt.

Despite sizeable annual pay increases to the NZDF for most of this decade, trained staff have taken advantage of the money available in the private sector. In recognition that the NZDF cannot compete on pay alone in a bidding war with the private sector, the NZDF response – as the Australians also did with the defence component of their Budget this year - has included staff packages based around housing and superannuation

The bidding war and the outcome are well understood. As Mateparae says in the 2008 NZDF Report :

"Despite positive morale, attrition rates are higher than expected. This reflects the fact that trained personnel, particularly in the technical trades, are in high demand outside the NZDF and are leaving to take up jobs at significantly higher levels of remuneration."

As one might predict, our extensive deployments overseas – in Timor, Afghanistan and elsewhere have stretched our capacity. So have the teething problems involved with integrating the expensive new equipment platforms we have bought - if only the health system had such problems. As Mateparae explains :

We have been challenged to maintain operational forces dispersed across three distinct theatres: each with their own support requirements.... Similar pressures, including contractor delays, are also being felt by the Navy and Air Force as they bring into service new platforms, in particular the Protector fleet, and upgraded C–130 Hercules, Orion P–3K, and Boeing 757 aircraft….”

The reality is that New Zealand’s capacity to spend on defence is finite, and we are facing a situation where we will not have the capacity to continue to do everything we would like to do. The question to be posed during the election campaign is this : should New Zealand continue to pursue the Derek Quigley blueprint ? Namely, of an armed forces primarily focused on Army deployments overseas that have a UN mandate, while the Navy and Air Force are primarily used to defend and protect New Zealand’s economic resources at home ?

So far, all that National has offering is a promise to have a “ White Paper” on defence next year, with no clues on what this might contain, and the direction they would like to pursue. If National is proposing to revert to equipping all three services for a military role beyond the UN umbrella - and alongside Australia and the US to support their foreign policy agendas - this will be extraordinarily expensive.

Leaving aside the question of whether that would be a desirable foreign policy agenda for New Zealand – the likely outcome for the NZDF would be the one we saw in the 1990s. Namely, inadequate funding, spread too thinly across the Army, Navy and Air Force for any of them to be effective.

ENDS

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