Changes to the armed forces would make them "more suited to 21st Century challenges", Chief of Defence Staff General Sir Michael Walker has said.
The Army says units experiencing shortages will be bolstered
Defence Secretary Geoff Hoon announced modernisation plans including the loss of around 20,000 jobs on Wednesday.
Sir Michael said the changes would "allow Britain's armed forces to remain... the best in the world".
Army head General Sir Mike Jackson said they would provide "increased capability, greater continuity".
"We have had to make some hard choices to achieve these aims," Sir Michael Walker said.
"Major change is always difficult but the changes we face together are necessary.
"These are stimulating times for all three services. Each can look ahead to a future with new systems and structures more suited to 21st Century challenges than those of the last century."
Among key measures planned are:
- RAF to shed 7,500 jobs and the Navy 1,500 jobs by 2008. A further 10,000 civilian posts across the services to be cut.
- Four infantry battalions - three from England and one from Scotland - to be cut.
- Three type-42 destroyers and three type-23 frigates taken out of service from the Royal Navy by March 2006.
- One RAF Tornado F-3 air defence squadron to be cut and the withdrawal of two Jaguar squadrons would be brought forward to 2006, with the final Jaguar squadron to be disbanded in 2007.
- RAF Coltishall in Norfolk to close by the end of 2006.
- The Navy will gain two new large aircraft carriers. The oldest destroyers - HMS Cardiff, Newcastle and Glasgow will be pensioned off by the end of next year. Three anti-submarine frigates - HMS Norfolk, Marlborough and Grafton will be pensioned off by 2006.
Army head Sir Mike Jackson said troops released from infantry regiment closures would be trained in specialities experiencing shortages, including signallers, engineers and intelligence and logistics experts.
"A lot of what has come out is exactly what we want from our future army structure," he told BBC's Newsnight.
Have you consulted Sinn Fein leader Gerry Adams or maybe the Fire Brigades Union as to whether they are going to behave themselves over the next few
Bruce George MP
Defence select committee
Chief of Air Staff, Air Marshal Sir Jock Stirrup, said that some changes had been driven by "hard realities of an increased but finite budget".
First Sea Lord, Admiral Sir Alan West, said he did not "instinctively welcome" the early disposal of good ships.
Mr Hoon told MPs: "The threats to Britain's interests in the 21st
Century are far more complex than was foreseen following the disintegration of
the Soviet empire.
"That is why the Defence White Paper signalled that we should continue to modernise the structure of our armed forces, to embrace new technology, and to
focus on the means by which our armed forces can work together with other government agencies to meet the threat of international terrorism and the forces
of instability in the modern world."
The details follow Mr Hoon's white paper Security in a Changing World, presented to the Commons in December.
The Ministry of Defence is planning to invest heavily in hi-tech digital systems to enable it to work closely with American forces.
But there are concerns the "special skills" of the British armed forces could be lost in what is seen as the most radical shake-up they have undergone.
Bruce George, Labour chairman of the defence select committee, said that he remembered at least 10 occasions when there had been "cuts followed by promises of great improvements".
"I need to be reassured," he said, adding that the committee would be inviting Mr Hoon to give evidence in early September.
"He will be faced not with rhetoric but some real and serious questions," Mr George said.
In the Commons, Mr George told Mr Hoon: "Some things I accept are good in what you said but please
explain who the idiot was who thinks you can cut the infantry at a time when the
pressure on them is enormous.
"Have you consulted Sinn Fein leader Gerry Adams or maybe the Fire Brigades Union as to whether they are going to behave themselves over the next few
Tory Nicholas Soames said there was a "deep crisis in the defence budget" and that armed forces personnel would feel "betrayed politically and morally".
"What matters at the end of the day is the boots on the ground," he said.
He added that plans to cut six frigates would "seriously degrade the Navy's ability to do its standing task".
For the Lib Dems, Paul Keetch said: "Iraq has shown that winning the peace needs more troops on the ground than winning the war."
He added that "a bit of spare capacity would have been a good insurance policy".