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Institute of Directors host event on the value of the British Army

A report assessing the value of the British Army to the UK economy was examined at an event held by the Institute of Directors today.

A panel of representatives from the Army, industry and academia took part in the virtual discussion, which drew on details of the report, which was published earlier this year.

The Army commissioned Oxford Economics in March 2020 to examine the economic and social value of the British Army to the Nation.  

Drawing on the full spectrum of the Army’s activity, the report sets out the value of the Army, akin to valuing a share price, assessing both the tangible and intangible. Framed through the lens of National Security Objectives, it details how the Army creates wider value over-and-above its primary purpose.

Speakers on the panel included Brigadier John Clark, Head of Army Strategy, who focused on the broader benefits of the Army to UK prosperity, to the idea of Global Britain, and the Army’s cultural value.

The British Army’s role in protecting the UK is understood by many in society. Most people would agree that the Army is important to the Nation, but unlike a business with an income, it is hard to quantify the value of the Army.

The report, which is based on data from 2019, measured the contribution of the Army through things like jobs and social mobility.

Looking at every aspect of the Army, it studied hard and soft power, security and stability, and economic growth and prosperity. As well as the Army’s core purpose – to protect the UK – the benefits to wider society were looked at in depth, to measure in monetary terms what the Army contributes to the UK economy.

Andrew Goodwin, Director of Applied Economics, Europe & Middle East, Oxford Economics, who wrote the report said:

“The Army is an important incubator for Research and Development (R+D), improving the Army’s knowhow but will a positive spillover benefit for UK prosperity. It’s R+D assets are worth about £720million in 2019/20. The knowledge generated by Army R+D also finds other applications.”

Referring to training provided by the Army, he said:

“Thousands of people entering the Army undergo formal and informal training, training which is worth at least £550m. This boosts social mobility for disadvantaged young people in particular. This gives people opportunities to realise their potential.

He also highlighted other benefits, such as support to civilian authorities, including being part of the COVID relief programme.

Brigadier John Clark said:

“This report shows how – beyond Defence exports – the value the Army provides to our culture, our society and to the business community.”

“I’ve seen so many examples of young women and men who have exceeded what they thought their potential could be.”

“We’ve never really been able to demonstrate how much we add to society until now. This report is a really important piece of work.”

Alastair King, Chair of IoD City of London Branch, and Professor Lynette Ryals, Pro-Vice-Chancellor, Cranfield University and Chief Executive, MK:U also took part.

The virtual event allowed those watching to take part in polls, and a question and answer session. One poll showed that 95% of those attending said the British Army provides good or excellent social and economic value to the Army

In the report, ceremonial and operations duties were studied, as well support to civilian authority tasks, such as flooding, or the London Olympics. The Army’s contribution to the Union, and to ‘levelling up’; sharing wealth and resources throughout the UK, was also considered.

The report said:

The prestigious Army regiments who deliver ceremonial duties are drawn from all parts of the UK, reinforcing the Union between the four nations of the UK. 

The scale of the Army means that it is an important source of jobs and income. The Army directly employs 117,000 personnel, drawn from and based in areas right across the UK. This geographical dispersion means that the Army is already operating in accordance with the government’s ambition to spread prosperity more evenly across the UK.

 The Army directly contributes £5.5 billion to UK GDP, but makes a much larger contribution through its procurement expenditures and as a result of workers’ spending. We estimate that the total economic footprint of the Army in 2019 supported 271,000 jobs and £15 billion in GDP.

Read the full report (www) The Wider Value of the British Army