A good commander looks after his men, just as an effective trade union leader represents the interests of his members. General Sir Richard Dannatt, the head of the British Army, has been outspoken in voicing the concerns of those soldiers serving in Iraq and Afghanistan or training for deployment.

Campaigning close to the legal and conventional limits of his job, General Dannatt has already raised the issue of welfare conditions, equipment shortages and military overstretch. Yesterday he spoke about pay. Was it right, he asked, that a soldier who risked his life in Afghanistan was paid less than a parking meter attendant? Should Britain not value the commitment and bravery of its troops by offering a private more than the £16,227 that an 18-year-old earns as a basic wage?

The immediate response of the public, whose respect for the Armed Forces stands high whatever view is taken of their deployments overseas, would be an emphatic yes. Yet pay cannot be set by attempting to price courage or a willingness to make sacrifices. Such things are, literally, priceless: valour, heroism and human life are not measured in pounds and pence, nor pay rises of inflation plus 3 per cent. For any job — from firefighting to playing football — wages must be set simply to recruit and to retain staff of the right quality. Setting wages therefore requires a shrewd understanding of the motivation of recruits. Soldiers do not enlist primarily for money. Challenge, excitement, training, the chance to serve: these are all more powerful reasons for joining up than pay. The Army is about 3,500 below strength and has been for years. An attempt to boost intake with a generous pay settlement in the past two years has not solved this problem.

The State’s failure to honour the service of soldiers is not in the modesty of pay, but the inadequacy of equipment, and the shabbiness of conditions. Our soldiers should have the best equipment available; be certain that the accommodation for their families is better than the dilapidated barracks too often available for married personnel; and know that the care they would receive were they injured would be comprehensive.

This raises the question of cost. If pay is increased above the rate of inflation, where will the money be found, what programmes must be cut and what signal does this send to public sector wage negotiators amid a worsening economic outlook?

The Ministry of Defence has no funds for higher pay. Its budget this year is £34 billion. This is no mean sum. But it is a rise of only 1.5 per cent over last year at a time when equipment costs are going up between 8 and 12 per cent and when other big-spending departments have seen far greater increases. To change the budget now would mean rewriting the Comprehensive Spending Review settlement.

So the Government must be hardheaded in its response to General Dannatt. Over time, however, military spending will need to rise. The Government may have improved equipment and spent money on accommodation, but plainly it is not enough. The Government cannot keep looking away from the fundamental issue of defence spending that arises from its military commitments. This country cannot will wars and decide upon interventions and then fail to provide the means to fight them successfully.