Think piece: How better regulation can make Private Military Contractors work



Are Private Military Contractors (PMCs) the villains of modern warfare? In this extended piece, Anna Moore argues that PMCs can play a vital – and valuable – role in making armies more flexible and streamlined, if properly used by governments. As in so many areas, private contractors can give states better results in key areas of public goods – if governments can avoid the oversight failures that have blighted PMCs' operations so far and strive for competition and transparency.

To Adam Smith, the first duty of the sovereign is the task of “protecting the society from the violence and invasion of other independent societies”. Smith did not specify how the end might be achieved, writing, “preparing this military force…is very different in the different states of society.” Libertarians debate whether defence is a public good. I am of the opinion that it is; national defence seems a true collective action problem and, like Smith, I believe that whatever government exists has a duty to provide it. However, I read Smith’s latter statement as acknowledging that this responsibility to provide does not confer an obligation to in-source.

The military should not be taken as sacrosanct, and immune to privatisation. Defence contracting is a legitimate complement to national militaries. In recent years, governments have failed to properly manage private military contractors (PMCs). Defence departments need to reform the way that they deal with contractors. With better oversight, competitive bidding, and clearer legislation, though, Britain and other nations can contract out more functions to cut defence spending while maintaining defence standards.

A discussion of defence contracting is timely because of the host of private military contractors (PMCs) in Afghanistan and Iraq. The United States is the single largest client. That country now has 15 times more contracts with PMCs than it did during the Balkan wars, and has more than doubled its spending on military contracts since 2001, reaching $500bn in 2008. According to Graham Binns, a retired British Army officer and current CEO of Aegis Defence Services, the UK has been “more reluctant” to outsource, but has increasingly done so since entering Afghanistan and Iraq. A 2009 report estimated that the Foreign Office had spent £51m on PMC contracts in Afghanistan and Iraq in 2008. Last year, it spent £29m on contracts in Afghanistan. Britain is also important on the supply side. At the height of the two wars, the UK was home to approximately 60 PMCs. [Continue reading]