ABSTRACT
Defence is costly. For example, in 2008, US defence spending was $607 billion, and the corresponding figures for China were some $85 billion, compared with $65.7 billion for France, $65.3 billion for the UK, $38.2 billion for Saudi Arabia and $30 billion for India (SIPRI, 2009). Defence equipment is also costly, with unit production costs for modern combat aircraft of some $133 million, with the corresponding figures for a main battle tank of $7.6 million and an attack helicopter of some $46 million (2008 prices: Pugh, 2007b). As a result, national defence budgets involve substantial sacrifices of hospitals, schools and roads, as well as of private sector goods and services (e.g. cars, holidays) and such sacrifices are obviously a source of public concern. Questions have to be asked about the ‘appropriate’ size of the national defence budget. Is the current budget too large or too small? What is the defence budget buying and does it provide good value for money? Does information on the budget enable elected politicians and the electorate to make informed choices about the efficient allocation of military expenditure between air, land and sea forces, between equipment and personnel (capital and labour), between nuclear and conventional forces and any overseas military role for the nation's armed forces? Society is interested in the efficiency with which defence resources are used and whether it is possible for politicians, voters and taxpayers to assess such efficiency.
