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Military Service Accommodation and the Exodus from the UK’s Officer Corps

The decision to end rank-based housing entitlements and to instead allocate all service accommodation on the basis of family size is threatening to decimate officer numbers in the Army and RAF.

Home comforts: an Army accommodation block in Gloucestershire

There is mounting concern at the shrinking of the UK’s armed forces, but one dimension has largely been ignored: the haemorrhaging of the regular officer corps of the Army and RAF. The number of Army officers choosing to leave the service early set a record at 792 in the last quarter, compared with a typical rate of 450–550 over the past decade, when the Army was larger. For the RAF it was over 300 for the last three quarters, more than at any time in the last decade, again from a reduced service size. These are typically younger, mid-career officers as opposed to those finishing their engagement, who are counted separately.

Yet, officers are critical. Despite the essential importance of senior and junior non-commissioned officers at regimental level, an army with a strong officer corps – from general officer to subaltern – will perform far better in war than a poorly officered one. Such an army is also more likely to retain its soldiers. People stay if they are well-led. In the RAF, there is a critical further point: while there are many pinch points in key aviation trades, the price of filling them does not compare to the multi-million cost of training pilots, who are all officers. The number of pilots in the RAF has dropped to the point where the Ministry of Defence no longer publishes figures, but the crisis is widely recognised.

A critical area for retention of officers in the Army and RAF is that of accommodation, and the forthcoming changes in family accommodation policy could compound the already serious problems. The risk is particularly acute for these Services because for more than a generation, most members of the Royal Navy with families have chosen to buy houses and settle, often aided by the (now tri-service) Forces Help to Buy Scheme. Despite the worst overall staffing figures of all three Services, the number of officers leaving the Royal Navy early by choice is below the rate a decade ago. But the Navy’s approach only works because its geographic concentration greatly reduces the need for mobility, and the surface Navy’s two principal bases, Plymouth and Portsmouth, both offer affordable housing to buy and live in through successive naval jobs.

In contrast, simple geography prevents the application of a similar approach to the other two Services, especially for officers, who are expected to be nationally mobile and move posts frequently (often every 18–24 months). A Treasury rule is forcing a pernicious distortion which will shortly shatter the already fragile offer for officers in the Army and RAF: the decision to end rank-based housing entitlements for officers and warrant officers and to instead allocate all family accommodation on the basis of family size under the New Accommodation Offer (NAO).

The Treasury says all benefits in kind should be taxed unless allocated on need, but service accommodation has been tax exempt since time immemorial – and for good reason given the role the UK expects its armed forces to carry out and the need to move them around with all the penalties entailed for service life. It seems that the Military Covenant has not reached the Treasury, and its rule distorts the offer to officers’ families beyond all recognition. A major or lieutenant colonel without children will see a 40% reduction in living space, if there is even a house available. The notice obscures this somewhat by focusing on numbers of bedrooms. But bedroom numbers are, as in the civilian world, a measure of the size and amenity of a house as a whole, defining the number and size of living rooms and suitability for the spouse to work from where necessary.

There are implications for discipline and regimental leadership in mixing officer and other rank accommodation, especially in the Army, where the number of ‘oversubscribed’ sites is higher, the proportion of officers much lower and the likelihood of disciplinary issues arising is higher. But the starkest impact is on retention incentives. At the heart of the exodus of officers from the armed forces are family life penalties and the lack of spousal career opportunities, which are listed first and third in the exit surveys, respectively. The US uses a rental top-up scheme in areas where military housing is short but, under its policy – despite the US’s avowed social equality – the payments are based on income (determined largely by rank) for both officers and enlisted personnel.

Changing families’ housing opportunities in the Army and RAF must be expected to compound retention problems, impacting on a critical part of the workforce

An additional challenge is that of accommodation access. In the original Future Accommodation Model (FAM) and now in the NAO the aim is to expand the range of those entitled to accommodation. The new categories reflect modern life, including those in unmarried relationships and those with children from earlier relationships who visit for more than 80 nights a year. But, as the current estate is overcrowded in many areas – especially for the Army – without more funding, this will mean a substantial increase in those being forced to attempt to rent locally; the MoD will pay an allowance but will not, in most cases, undertake to find such accommodation and, even if housing can be found, the allowance may not cover the additional cost. In addition, the Army Families Federation (AFF) has repeatedly pointed out that many sites have no large local rental market. As officers are more mobile with the need to move in and out of staff jobs, some will find that properties are all occupied and will struggle to find local rented accommodation, even a long way away.

Changing families’ housing opportunities in the Army and RAF must be expected to compound the retention problems, impacting on a critical part of the workforce – especially expensively-trained middle-ranking officers – and so dilute the experience in the Army and RAF. It seems that the Treasury values its rules above elementary considerations of value for money, let alone defence of the realm. The AFF has raised concerns about this, for all ranks, together with the fact that resources for repairs and refurbishment will be even more tightly stretched. It goes on to say:

“One of the few clear conclusions from the [Future Accommodation Model] FAM pilot that has been pulled through into the New Accommodation Offer is the preference for Service Family Accommodation, given the flexibility it offers to highly mobile families when compared to private rental.”

The FAM pilot occurred in three locations but, crucially, was predicated on offering families a degree of choice that has been largely eliminated from the NAO. Furthermore, the samples of people consulted were small, selection was opaque, and the Army and RAF locations – Aldershot and Wittering – were unrepresentative as both are close to urban conurbations with active rental markets. Nevertheless, the rollout begins in March 2024 and will be implemented over three years, with transitional arrangements in the interim. As small sweeteners, single living allowance will be extended to those living in single accommodation whose families are beyond a daily commute, and Help to Buy grants will be raised by an extra £1,500 towards legal fees, over and above the current cap of half an individual’s salary up to £25,000.

It is difficult to exaggerate how bad this is for the families of middle-ranking officers whose retention is so critical to the capability of the Army as a whole. The Army has been concentrated mostly on sites where there is little employment for spouses, Tidworth and Catterick being the largest. Some RAF sites, including Lossiemouth and Valley, are similar.

The UK is close to losing a whole cohort of the best and brightest officers, and a key factor is that a well-intentioned MoD scheme has been wrecked by a Treasury tax rule

Spouses of people in all three services make colossal sacrifices, seeing their partners leave for periods of many months at a time, while their own careers are often made untenable. While their counterparts in civilian life are mustering two salaries to get onto the first rung of the housing ladder, military families know that, with the spouse’s career hobbled, it will be much harder for them to climb on later. Those officers or soldiers/aviators who do manage to buy a house – if they are posted away and let it out – pay rent on their service family accommodation on top of the mortgage and tax on any rent received, and face considerable risks trying to manage tenants from afar. So, those dependant on service family accommodation at least expect a decent house to live in; yet, as has been widely reported, the standard has been deteriorating even before this latest blow.

A further factor is that, in late 2022, the decision was taken to centralise the allocation of housing to a single (contractorised) office in Liverpool. This means that the ability of commanding officers to influence cases involving extra hardship – or especially critical personnel – has disappeared. For example, the arrangement whereby certain key warrant officers, such as regimental sergeant majors, received accommodation suitable to their position can no longer be upheld.

These factors apply to all ranks but, compounding them for most officers is the fact that stability is simply impossible, unless past the age of regimental service. Most Army staff jobs are in Hampshire, Wiltshire or the MoD – yet more than half the infantry, Royal Engineers and Royal Signals units, for example, are a long way from those areas. Similarly, the main concentrations of RAF staff jobs are in High Wycombe and London, a long way from most operational stations. So, the crucial – and rising – middle-ranking officers in the Army and RAF moving between operational postings and staff jobs will remain highly mobile as ever, even with the planned tinkering with longer tours.

The growing exodus from the Army and RAF officer corps is becoming a flood. Anecdotally, the impact of this policy has already begun, with officers already having signed off as a result of it and yet more reporting active steps to prepare their exit during the transition period. The author understands that the first ‘trawl’ for the next batch of company commanders in the infantry (jobs that majors usually compete hard for) has fallen a third short. Of course, there are other factors too – and not all of them are shown on the MoD survey. Nevertheless, the UK is close to losing a whole cohort of the best and brightest officers, and a key factor is that a well-intentioned MoD scheme has been wrecked by a Treasury tax rule which drives a coach and horses through the Military Covenant.

Officer staffing levels can be massaged by promoting more (older) people from the ranks to replace younger officers, by awarding regular commissions to those who would otherwise not pass the quality line, or simply by adding to the growing numbers who are medically downgraded. As such moves undermine the UK’s credibility for top-tier forces, the key statistic to watch is the number choosing to leave early – and this number is already in a bad place for the RAF and a terrible one for the Army. If this set of changes – structured around an ideological Treasury rule – is driven through, wrecking the offer for officers, the consequences for the future Army and RAF are difficult to exaggerate.

The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.

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