Resource Guidance

Resource guidance must always be viewed as one amongst several instruments to guide the defence efforts within the Alliance. No formula can provide more than planning guidance; the ultimate yardstick is the overall ability to perform the tasks required to support NATO's overall deterrence and defence objectives.

1. There is a political and military need to improve NATO's conventional defence capabilities in relation to those of the Warsaw Pact in order to narrow the gap and reduce dependence on the early recourse to nuclear weapons.
2. To achieve this every effort must be made to obtain optimal value from scarce resources.
3. To this end vigorous efforts must be made to improve cooperation and coordination within the Alliance, and as part of these efforts a study should be undertaken as to whether specific improvements could best be brought about by common funding.
4. Notwithstanding the above efforts to improve the output from existing expenditures it will be necessary to increase the allocation of resources to defence in real terms with most nations achieving rates of real increase higher than those in the past.
5. Determined efforts should be made as a matter of urgency to devise an agreed and accepted methodology for measuring output performance with a view toward developing a variety of key performance indicators allowing supplementary resource guidance to be set in those terms.

The 3% formula is confirmed as a general guide. Those nations which have not met it in the past should make every effort to do so in the future. In applying this general guide, account should be taken of the considerations applying to individual countries based on analysis of all factors relevant to the respective national defence efforts. These considerations should take as their starting point the quantity and quality of each nation's past and present defence effort, the identification of the most critical deficiencies in each nation's force contribution and the necessary improvement measures, in short, performance. Nations should achieve, to the extent possible and as soon as possible, necessary force improvements even if they are additional to those contemplated at the resource level called for by the formula.