NATO Secretary General Anders Fogh Rasmussen has set out austerity principles for the defence alliance with an economic straitjacket to hit defence budgets for years to come.
While the former Danish prime minister urged allies not to cut too deeply -- saying they could target "fat not muscle" but that "salami-slicing" across the board was inappropriate -- he said a "rationalisation" drive was underway.
"The financial crisis has put enormous pressure on defence budgets in all NATO countries. Many have already made cuts -- some very deep," Rasmussen said on the sidelines of a NATO defence ministers meeting in Brussels.
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According to data released by NATO, only five of the alliance's 28 member countries respected its minimum engagements to spend two percent of national output on defence in 2009: Albania, Britain, France, Greece and the United States, whose spending at 574 billion dollars easily dwarfed the others.
"We can use this crisis as motivation to make the right changes, to focus on the right things and to do as much as possible together," Rasmussen underlined.
Nevertheless, he stressed that "whilst seeking savings, we must preserve our ability to deter attacks against us. We cannot cut so much to meet immediate demands that we sacrifice our security."
In a letter to Rasmussen at the end of April, nine member countries called for a restructuring of NATO that would affect everything from its headquarters to its command structure, according to an allied official.
"There is a widspread agreement we need to rationalise and modernise," he conceded.
According to a US official, NATO could slash its committee bureaucracy by more than three quarters.
Rasmussen, according to an allied diplomat, has proposed two options for debate: reducing NATO's command structure from 13,000 posts at present to 9,500 or even 7,500.
French Defence Minister Herve Morin said progress was being made in the talks about modernizing NATO's structure and an agreement was close, also owing to the cooperation between the United States, Britain and France.
"We're making progress in the talks and we're close to a deal," Morin told AFP after a working dinner on NATO reforms with his counterparts. "After three years of battling, together with the British, this is a good outcome."
Morin said that "France would have liked a cut to 7,500 of the staff of NATO's command structure but after discussions we're closer to 8,000".
Another target is making NATO troops "more deployable", he added.
A working group tasked with looking into the issue "will prepare new proposals by June 30 which will then be submitted" to the member states, said Morin.
