“Mr Speaker. Today is the day when Britain steps back from the brink. When we confront the bills from a decade of debt.”
These were the words of George Osbourne yesterday, before he announced what are reported to be the largest cuts in a generation. Amongst the £81bn to be cut from public spending over the next six years are £7bn extra from welfare payments, 19% in average cuts from departments and the abolishment of nearly 200 quangos. 192 of these public bodies will be axed, whilst 118 more will be merged in a move which the government defends as improving accountability and cutting costs. Some of those facing extinction include the UK Film Council, the Audit Commission and Regional Development Agencies.
The Audit Commission’s role in improving accountability would appear to be negligible in the view of the government. Those bodies and departments which have remained untouched presumably play a sufficiently strong role in achieving this goal. One such organisation is the Export Credit Guarantee Department (ECGD) which helps exporters of UK goods and services to win business overseas by providing guarantees, insurance and reinsurance. A major client of this department has been the arms industry which consumed between 30-50% of its budget in the early years of the decade. In one year BAE alone accounted for 42% of the ECGD budget.
The scheme is defended by the government as a vital support to British industry and British jobs. Despite employing merely 65,000 in 2006, the combined subsidies allotted to the arms industry through the ECGD, R&D and trade mission support totalled £852million a year. This is equivalent to a subsidy of £13,000 per employee per year. When compared to an annual salary on Job Seeker’s Allowance of £2696.2 this appears an incredibly inefficient means of providing for workers, ignoring of course the huge profits which these companies make. Not only this, but the department was recently implicated in a court case which revealed that ECGD funds had been used to underwrite contracts obtained by bribery. No cuts or reforms have been proposed for this department.
Another body escaping the “fair” allocation of cuts is UK Trade and Investment, and its sub-division of the Defence and Security Organisation. This body is the repackaged entity for the former Defence Export Service Organisation (DESO). Set up by Dennis Healey in 1966, the organisation promoted foreign arms sales abroad and was headed by seconded executives from private defence companies. Mr Healey defended its creation to Parliament, espousing that:
“while the Government attach[es] the highest importance to making progress in the field of arms control and disarmament, we must also take what practical steps we can to ensure that this country does not fail to secure its rightful share of this valuable commercial market.”
This aim was not forgotten, and DESO continued to play a prominent role well into this decade. It employed almost 500 staff, with around 400 in London and a further 100 based in offices across 17 countries worldwide. DESO also worked closely with military attachés in at least 80 British Embassies. It was not until 2007 when demands by the Liberal Democrats, Plaid Cymru and the Greens as well as 30 NGO’s with a signed statement led to the organisation’s closure by Gordon Brown. 
Far from the end however, DESO’s work has continued to flourish within UK Trade and Investment. The body boasts services to its clients including facilities for events and exhibitions, market analysis and opportunities to take advantage of some of the MOD’s “long-term partnerships” in overseas markets. Indeed DSO continues to employ more civil servants than all the other sectors of UK Trade and Investment combined. This seems only “fair” for an industry which employs less than 0.5% of the UK work force, and at a time when other British industry such as Vestas is moving overseas. Of course these overseas deals can only take place under licence by the UK Government. These have been granted so far to 13 out of the 20 worst offending states on human rights records. 
With its unrivalled assistance to private arms companies it is no wonder that the UK continues to play a leading role in global trade. One might question whether the services, expertise and taxpayer funds which are disproportionately allotted to this industry could have been used to secure the development of an IT or Green energy base within these shores. It seems that the international community has decided though. UK Trade and Investment recently won an international award for Best Trade Promotion Agency.
The Department is not ready to rest on its laurels as others around it face cuts and abolishment however. This summer it published a report identifying new opportunities for British companies in Iraqi Kurdistan, describing the region as, “a gateway for British companies looking to establish a foothold in Iraq.” With the intelligence gathered from almost 8 years of occupation it is likely that UK Trade and Investment will be well placed to give British industry the edge in this “new market”.