British troops could be withdrawn from Germany by a future Tory government if other Nato states agreed to take over the UK’s commitments there, the shadow defence secretary, Liam Fox, has said.

Fox said it is “no longer necessary” to keep 20,000 military personnel in Germany, nearly 70 years after the end of the second world war. Ending the deployment would free up forces to carry out vital Nato operations outside Europe, he said.

The number of soldiers in Germany has been scaled down over the years and their presence is now centred on Herford, near Hanover, where the 1st Armoured Division is based.

In an interview with the Daily Telegraph, Fox signalled his determination to conduct a “wholesale recasting of our foreign and defence policy … If other countries are willing to take up roles in continental defence, that leaves Britain and France able to take on expeditionary roles,” he said.

New Nato member states from eastern and central Europe, particularly Poland, should take over Britain’s commitments in Germany, he added.

A final decision will depend on negotiations with Nato allies, especially France, and on the Ministry of Defence’s ability to handle the return of so many soldiers, for whom there is no accommodation in the UK. “Finding a more creative diplomatic solution in Nato will be a priority for an incoming Conservative government.

Fox said he had told civil servants to prepare plans for cutting the MoD’s administrative costs by 25% – some £3bn – by 2012.

The Tories are also looking at fast-tracking younger commanders with combat experience in Iraq and Afghanistan to senior posts.