This Army Reserve plan needs a tax break

Today the Philip Hammond will announce the proposed changes to the UK’s reserve forces.  Reports suggest that the plan to rename the Territorial Army (TA) as the Army Reserve will be implemented but tax breaks for the employers of reserve forces personnel will not.

Good news, bad news.


Reserve forces Captain Lisa Irwin in Afghanistan 2011

The convergence of the TA and regular army has been happening subtly for well over a decade, with the deployments to Afghanistan and Iraq being the two main drivers.  TA soldiers have formed a part of every deployment to the two theatres and the first soldier killed by enemy action in Afghanistan was Rifleman Jonathan Kitulagoda of the Rifle Volunteers, a TA unit.  The name Territorial Army implies a separate army to the regular army whereas Army Reserve makes it clear that it is the reserve part of one army, the British army.  It’s a subtle name change but it matters.

Being recognised as a integrated and integral part of the army will be essential if we hope to reach the recruiting target that has been set by the MOD.  Unfortunately this will be hampered by the decision not to give tax breaks to employers of reservists.  This is a missed opportunity and I am sure that eventually it will be seen as such.

In order to make the reserve component larger and more deployable we need to rebalance the relationship between the military and civilian employers.  To train collectively all reserve personnel need to be able to take time off work at the same time and mobilising reservists is disruptive to their employers.  A small additional few pounds of compensation, as currently proposed, will not create the positive relationship upon which the future reserve forces model depends.

The irony is that an employers’ National Insurance tax break wouldn’t actually cost the government much money (if any) at all.  Reducing the cost of employment, especially for small businesses, means that more money can be ploughed back into the business generating more tax revenue to the government.  Strong defence and lower taxes should be an easy sell for a Conservative government.

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