Armed Forces Readiness and Defence Equipment
Debate between Lord Spellar and Lord Beamish(8 months, 1 week ago)
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John Spellar
Another key feature of that era was the Treasury’s 10-year rule of basing defence expenditure on the assumption that there would not be a war in Europe within the next 10 years, which rather unravelled at the end of the 1930s.
Mr Jones
It is laughable, as my right hon. Friend says. We need to make sure that we actually invest, because this is about skills and about ensuring that we have the workforce.
We have seen the effects when we just pull out of such work. We cannot look at our skills base as a tap, which we turn on when we want it and turn off again when we do not. We cannot do so, because we have seen the costs of that—for example, on the Astute programme. To be political, it was again the Conservative Government who stopped building submarines, so we had a gap in skills, and it has taken all the effort recently to rebuild that skills base and ensure we get it back. We must have such a skills base continually, and that has to be done by working with our European allies. Whether the zealots of Brexit and the anti-Europeans like it or not, if we are talking about things such as stockpiles, we do have to work with allies and make sure that we can deliver them through the supply chain we have.
Defence Supplementary Estimate 2021-22
Debate between Lord Spellar and Lord Beamish(2 years, 8 months ago)
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John Spellar
I thank the right hon. Member for his intervention—I think he should have declared an interest. He is absolutely right; the defence estimates and the Budget need to reflect the new reality.
I want to concentrate on the broader context: the ideological battle that is taking place, and the institutional shake-up that is consequently required. Most crucially, we have to recognise the full-spectrum approach of our opponents. Commentators in the west often gabble glibly about hybrid warfare, but in the framework of cyber war as an alternative to kinetic capability, and often in a mechanistic way, rather than understanding the political context and the need for whole-of-society resilience.
The Soviet mindset, of which we are now seeing a resurgence, is quite different. For these people, politics—politik—is everything. All agencies of the state are engaged. For too long we have ignored the multidimensional attack on our society, but that is a luxury we can no longer afford. This also means that the integrated defence review has, to an extent, disintegrated, and requires a major revamp which should start immediately. This necessary intellectual rethink must now focus primarily on state-on-state conflict.
Over many years, I have posed a question a number of times to military figures, defence officials and academics. During the cold war, we based our defence and security posture on our assessment of “the Threat”, with a capital T, and I have asked what the Threat is today. Invariably, I receive the answer that we face a variety of threats, but that is not the right answer, because the question is “What is the existential threat to our nation and society?” It is not terrorism, Islamist or otherwise, ugly and vile though that is. Today we—the people of Ukraine, the people of Europe, and indeed the west more widely—know the answer. It is a revanchist Russia and its desire to re-establish the Soviet territory, although I accept that in the longer term, as the defence review states, a revisionist China may be a more significant challenge. That means that today’s estimates are fundamentally an historical document, as, indeed, is the review.
That is not just down to the violently aggressive attacks by Putin’s Russia, but is also, thankfully, a result of the vigorous response not only from NATO allies but from formally neutral countries such as Sweden and Finland, where for the first time there is a public majority favouring NATO membership. The most seismic public reaction has been in Germany, where the new Social Democratic party Chancellor, Olaf Scholz, has rewritten decades of German policy of both parties in his historic speech to the Bundestag. Equally dramatic was the wide political support, including support from the German Greens.
Chancellor Scholz stated clearly that President Putin had created a new reality which required an unequivocal response and a dramatic shift to supply Ukraine with weapons. He also made it clear that making international solidarity possible required new, strong capabilities. Essentially, that means that Germany must invest more in the security of the country. He addressed the readiness crisis in the Bundeswehr, which has been widely publicised and has featured in discussions we have had with our German counterparts. He stressed the need for aeroplanes that can fly, ships that can set out to sea, and soldiers who are optimally equipped for their mission. He has designated a one-off sum of €100 billion to set up a special fund, and has pledged an annual 2% of GDP.
I suggest to the Minister—I should welcome his observations—that we may also need to revise the ideological decision made by his Government, although not by current Ministers, to abandon our bases in Germany. I do not think the indication that we might make some minor return meets the need presented by the current challenge.
This was an imaginative, bold and historic intervention. Scholz clearly, in Bismarck’s phrase, heard God’s footsteps marching through history, and managed to catch on to His coattails as He marched past. I hope that our Ministers see the significance of that intervention, and engage rapidly and deeply with our German colleagues to build on this new reality. I hope they will also engage with our own defence industry. The Financial Times reports that after Scholz’s speech on the Sunday, on the Monday the German Defence Ministry and defence firms were engaged in detailed discussions as to how to ramp up production. The MOD and ADS should take note, because that is the sort of national response that we need. I was talking with the industry yesterday, and this does not appear to have happened, particularly not in the supply chain, which is wondering where it fits into the changed environment.
Mr Kevan Jones (North Durham) (Lab)
But this has been happening for many years. These are political decisions that have been taken, and nearly 30% of our procurement is now bought off the shelf from the United States, with no commitment from companies such as Boeing to reinvest to ensure that not only jobs but technology stay in the UK.
John Spellar
My right hon. Friend is absolutely right. It is vital to have a well-established industry to be able to respond to a crisis. The Ministry of Defence and the Treasury need to break out of the ideological straitjacket that states that domestic industry does not matter and we can buy from anywhere in the world. That is a hugely important change.
John Spellar
I would welcome a bit more detail from the Minister as to the nature and engagement of those discussions. I was talking to a representative from the industry only yesterday, and they are seeing precious little coming through. It is not happening in any way on the same scale or intensity as in Germany. We could argue that Germany is doing some catch-up, but it is really engaging with its industry. As my right hon. Friend the Member for North Durham (Mr Jones) has said, we give away huge orders and get little or nothing in return. Even now, the Minister’s own Department refuses to commit to building the fleet solid support ships in the UK, and his colleagues in the Home Office are giving an order for new Border Force vessels to a shipyard in Holland.
Mr Kevan Jones
It is worse than that. The Department used to hide behind European regulations, but now we are out of the European Union, we should be free to procure in the UK. I challenged the Minister before Christmas as to whether his Department was going to give a £10 million contract to Damen in the Netherlands for a special naval vehicle, and he said we should wait for the competition. Lo and behold, this week it has been announced that Damen has won that contract for a vessel that could have been built in this country.
Mr Kevan Jones (North Durham) (Lab)
I thank my right hon. Friend the Member for Warley (John Spellar) for opening the debate. He is right that our thoughts today are with the people of Ukraine and the brave servicemen and women, and civilians, who are resisting the might and cruelty of Putin’s war machine. As the right hon. Member for New Forest East (Dr Lewis) said, that focuses our minds in our debate on defence.
We need to ask how we have ended up with the smallest Army in our history. That has not happened by accident; it is a political choice. In 2010, a Conservative party came into power, in the coalition Government, that had argued before the election for more spending on everything in defence, but then, suddenly, they got into a programme of austerity, under the cloud of a mythical £38 billion black hole that the bad Labour Government had left them. That never existed and we know that because within two years, it seemed to have disappeared, given what the Government said.
That Government cut the budget by 16% because the Treasury wanted money out of that budget. The hon. Member for Plymouth, Moor View (Johnny Mercer) asked why this was about people—well, it was about people because that is how to get money quickly out of a budget. The Government did things such as making people take compulsory redundancy and losing people with vast experience, and it was absolutely shameful. If a Labour Government had done that, frankly, there would have been an outcry.
John Spellar
Is my right hon. Friend not shocked that that Government did not learn lessons from the cuts in personnel under Options for Change after the end of the cold war, which led to the same collapse in morale and loss of experience?
Mr Jones
My right hon. Friend is right, but these measures were not about that. They were about the Treasury making austerity cuts. We now have a situation where the present Government—who, again, talk in slogans—talk about the biggest cash injection ever. The budget will still be lower in real terms than it was in 2010. The fact is that, like the right hon. Member for New Forest East, I would agree with increasing the defence budget, but we have to recognise how we got to where we are today.
Interestingly, there is clearly some thinking going on in the MOD, because I asked a parliamentary written question last week, which I tend to do, as the Minister knows, on whether the cuts would be reversed. I would have expected to get a reply within days, but last night, I got a holding reply saying that the question of whether the MOD would reverse the decision on reducing the Army to 73,000 personnel could not be answered in the normal timescale, so I suspect that a lot of work is going on in the MOD on that. It has to look at that, because everyone who has spoken in this debate has said that, although we can have enough equipment and the concepts of war, at the end of the day, we need people. That is key.
As Members know, I have always been an advocate for defence and I would argue for more defence spending, but I think that argument will fall on deaf ears a lot if we look at the way that this matter is being managed internally in the MOD. The NAO report is a bit like groundhog day: every year it comes back with a catalogue of delays and overspends. Whatever the Minister says, I am sorry, but he should just read the report. The budget is not in surplus. It misses things out and looks at efficiencies. But it has been like this for the past 10 years, and efficiencies have never been achieved and never will be.
It is important that we use defence expenditure, if we actually get it, to generate capacity in the UK defence industry and ensure that we get the equipment we want. I welcome things like the national shipbuilding strategy, but I am appalled that, even this week, the MOD has given a £10 million contract to a Dutch yard for a vessel that could have been built here. The right hon. Member for Ludlow (Philip Dunne) has done a very good report that says that we should take social value into account when awarding contracts. I have asked the Department and now the National Audit Office to tell me what the formula is for that.
We are buying off the shelf from the United States and others, without any commitment to supporting our native shipbuilding and defence sector. I am one of the people arguing for more on defence, but I want to ensure that there is a proper defence industrial strategy behind it, not only to deliver for our armed forces, but to ensure that we get jobs and prosperity here. I see no evidence of that at the moment.
The last thing I would like to talk about is the nuclear deterrent. As the House knows, I have always been an advocate for our continuous at-sea deterrence, and these times have brought its importance into sharp focus. It will be important for the Department to ensure that the programme not only has finance behind it, but is actually on target. People have talked about the guarantees that Ukraine was given; whatever Putin guarantees is completely worthless, but the one guarantee that we have behind us is the nuclear deterrent. It is important that we maintain it.
These are dark times. We will hear a lot of instant judgments about what is happening in Ukraine, but we cannot have armed forces without people, and we have to invest in those people. It is not just about numbers, but about making sure that we have the right skillsets and that they continue. Frankly, the IR is now redundant and has to be revisited. And can we get away from the slogan “global Britain”? It is a great slogan, but it suggests that we are going to rule the waves and send power around the world. We will not, on our defence budget, and we never will again.
We have to ensure that we invest in what we are good at. It might be unpalatable for some Government Members, but we have to work with our European colleagues in NATO to ensure that we deliver a deterrent effect—I was going to say “on the Soviet Union”, and actually there is not much difference between that and Putin’s ideology and the way he is doing things. We have to ensure that that happens and is done in a coherent way. We have to get away from the rhetoric. Let us have a proper defence budget that is not only in balance, but puts the investment where it counts.
I will break the habit of a lifetime and agree with the hon. Member for Plymouth, Moor View, who has just come back into the Chamber: we have to invest in people. We can have all the best equipment in the world, but without the people, the skillsets and the right mix, we will not get a deterrent effect or treat our people right, as they deserve.
UK Defence Spending
Debate between Lord Spellar and Lord Beamish(3 years, 5 months ago)
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Mr Kevan Jones (North Durham) (Lab)
I beg to move,
That this House has considered UK defence spending.
I begin by thanking the Backbench Business Committee and those colleagues who supported the application by my hon. Friend the Member for Islwyn (Chris Evans) for the debate. It would be remiss of me not to recognise the members of our armed forces this week. Armed Forces Day is coming up this weekend when we will think about the work they do on our behalf, but we should, as I said yesterday, think about it every single day of the year.
Yesterday’s events in the Black sea showed how fragile is the world in which we live, with the threat from Russia and developments and increasing threats in China. The domain of defence has changed in terms of, for example, cyber, space, information technology, the asymmetric threats from hostile states, and the determination of some to tear up the international rules-based order which we have come to accept since the second world war.
On 19 November, the Prime Minister announced that the defence budget would increase by £16.5 billion over the next four years. Anyone who knows me will know that, for my part, any increase in defence expenditure is welcome. The Government committed to that increase over and above the 0.5% that the Conservatives had agreed to in their election manifesto. However, the 2020 spending review funding settlement described it as an increase in defence spending of £24 billion in cash over the next four years—something that has been repeated often by the Prime Minister.
I thank the Institute for Fiscal Studies for pointing out that that is rather misleading. It believes that it would be more accurate to say that by 2024-25 the defence budget will have risen in real terms from 2019-20 by £7.5 billion. It seems that the Government have got the £24 billion figure by taking the cumulative increase each year. I do not think that helps the debate on defence expenditure, because clearly that methodology is not one that most people recognise. What clearly is the case is that, by the conventional method by which it is measured, by 2024-25 the defence budget will be £47.4 billion in real terms, which is a 7.5% increase.
Another thing that seems very strange—this was very helpfully pointed out by the House of Commons Library—is that if we look at the way the Government have profiled expenditure, we see that most of it is in the first three years, from 2020-21 to 2022-23. No doubt a general election has been pencilled in for somewhere around then, because after that it drops from 5.6% in 2022-23 to 0.4% in 2023-24 and 2024-25, so in terms of the way in which this has been explained, some of the claims that have been made should come with a health warning.
I would also point out, thanks again to the House of Commons Library, that the defence budget will still be smaller in real terms than it was in 2019. As people know, I am a little bit of an anorak about following the defence budget and reading National Audit Office reports. If we look at what happened, we see that from 2010 the defence budget dropped in real terms by £9 billion. It is worth exploring the history of the defence budget over the last 10 years as a comparison with what we have today. We all remember that in 2010 the Conservative coalition Government took office saying that the Labour party had left the defence budget with a £38 billion black hole. I tried on numerous occasions to find out where that figure came from. The only way I could get it was from the NAO’s 2009 major projects report, which said that on the equipment side there would be a gap in the defence budget of £6 billion over 10 years if the defence budget only rose by 2.7%. It then went on to say, strangely, that if there was no increase over the next 10 years it would be £36 billion. Clearly, the spin doctors in the Conservative party added an extra £2 billion for good measure.
Over the period of the last Labour Government, there was a real increase in the defence budget of 5.5%. If we want to question whether the £38 billion was just rhetoric we can, because within two years of the coalition Government coming in it had been completely wiped out. Clearly, the individuals who were Defence Secretaries then should be brought back to field the fiscal crisis we face today. However, the reality is that that covered up what the Government were actually doing, which was slashing the defence budget from 2010 onwards. For six of those 10 years, we had a reduction in the defence budget, including an actual reduction of 9.7% in 2012-13. When the Government were arguing that they were standing up for defence, they were doing exactly the opposite, slashing it throughout that period by over £8 billion, and we all know the consequences of that. We cannot start today’s debate with the idea that this is somehow new money; it is not even catch-up for what was cut throughout that period.
John Spellar (Warley) (Lab)
Was not one of the really detrimental outcomes of that that the services and the Ministry of Defence were pushing programmes to the right and therefore extending them out, adding to costs and disrupting those programmes, and that our troops then did not have the equipment that they needed?
Mr Jones
My right hon. Friend is right, and those chickens are now coming home to roost with some of those programmes. That adds cost, but the main effect was that we saw a 45,000 cut to the Army. Despite the fact that the Conservative party in opposition, when I was a Defence Minister, called for an increase in the Army and an increase in the defence budget—an increase in everything—the first thing it did in government, under the smokescreen of this fictitious £38 billion black hole, was to cut the defence budget. Now we have a situation in which the Army is going to be reduced by another 10,000. Alongside that, we had compulsory redundancies, in-year budgets cut at short notice, and ridiculous decisions taken, for example on Nimrod and Harrier, which were scrapped at a moment’s notice. That had a real effect on the capabilities of our armed forces, as my right hon. Friend has just outlined.
Then we come to the equipment plan. Again, I suggest that anyone who wants to understand the defence budget should always read the NAO reports. The NAO is very clear that the equipment plan, as outlined at the moment, is unaffordable. It has been like that for the last four years, and there is no sign that it is going to improve. According to the last report—these are the MOD’s figures, I hasten to add; I am not adding to the fiction—there is a £13 billion black hole in the current equipment plan. The security and defence review—the integrated review—was supposed to look at that. The one thing I was calling for from that, as I think a lot of people were, was some reality: “What are you going to cancel out of the budget to get it back in balance? Will you actually say what you will do?” It did not take the opportunity to do that. The other startling thing from the most recent report is that the efficiencies that were supposedly built in to make the equipment plan affordable have been completely ignored by the Ministry of Defence.
How did we get to this place? Again, we have to look at the history of what the Government have done over the last 10 years. They introduced the Levene review, which pushed the top-level budget holders back to the military and reduced control at the centre. The latest report shows that nearly a third of the accountancy positions in the top-level budgets in the RAF, Army and Royal Navy are vacant, so there is not that control. I said at the time that I thought the Levene review was misguided. It has left the centre with very little control over some of these issues.
We then had the ludicrous decision, thanks to the Liberal Democrats in the coalition Government, to delay the ordering of the Successor class for the nuclear deterrent, which has led to our existing deterrent having to be extended, at huge cost. Without the ability to look in detail at driving down some of these costs, even with the increase that has been made, I do not think that the equipment budget will be affordable. The way the MOD does its budgets needs fundamental reform.
Why does this matter at the end of the day? It matters for two reasons. First, as my right hon. Friend the Member for Warley (John Spellar) has just said, it leads to a situation in which the men and women of our armed forces do not have the right equipment. It is also inefficient, because it pushes things to the right, and we end up with those us who argue for more money for defence facing people who say, “Why should we give it, if you have this chaotic system?”
However, it is even worse than that. This relates to the equipment we are ordering. A very good report was written by the right hon. Member for Ludlow (Philip Dunne) on prosperity. I am a believer. The Prime Minister thinks that now in this golden age after Brexit we should buy British—but the MOD is doing completely the opposite. It seems to buy American. Recently, we have had Wedgetail, the maritime patrol aircraft and Apache helicopters all purchased from the United States in a Government-to-Government contract.
People ask, “Why does that matter?” It does matter. First, because we are not supporting British jobs. Unlike other nations that insist on a work share, as the Indians did with their P-8s, we do nothing at all, so we are left completely wide open not just to our industrial base being denuded, but to foreign exchange fluctuations. That is of huge interest in terms of the defence budget. If we look at it as a whole, US content is 31% now—it was 10% in 2006—and we are opening ourselves up to the fluctuations of the currency markets. That is money that should be going into our frontline services, but it will not be.
No explanation has been given to me as to why we have suddenly gone down that path, and why we have not insisted that the US companies we buy from have to work in the UK. That is inexcusable, but it is a clear decision taken by the MOD that exports British jobs to the United States but also makes our defence budget very vulnerable to currency fluctuations.
John Spellar
Is it not worse than that? Whereas the United States air force wanted to buy Brimstone and was prevented by congressional pressure—they knew it was a superior product—the MOD has now dumped Brimstone and is buying Hellfire from the United States.
John Spellar
Interestingly, in 2008, when the global financial crisis hit, the ratio of debt to national product was less than it was when we came to office in 1997, and in the meantime we built the schools, the hospitals and the infrastructure that the Conservative Government had lamentably failed to build.
Mr Kevan Jones
Does my right hon. Friend also remember that during those years, up until the crash of 2008, the then Conservative Opposition not only argued for matching our spending targets, but called for more expenditure on defence?
John Spellar
I hope the Whips have taken note and that the hon. Member for Filton and Bradley Stoke (Jack Lopresti) will get a job after his intervention. By the way, what was the debt to national product ratio when we left office and what is it now? Perhaps the hon. Gentleman could tell us that, but he should not bother to interrupt at this moment to do so.
It is not just what we spend but where we spend it. We have had that argument continually in the Chamber. Why are we buying ships from Korea? Why, even when we are going to have the fleet solid support ships armed, does the Secretary of State still talk about only joining them up, not building and procuring all their equipment, here? Why are we buying so many planes from the United States? My right hon. Friend the Member for North Durham (Mr Jones) pointed out to me that our dollar purchases in 2016 accounted for 10% of equipment. That has now increased to 31%. The hon. Member for Yeovil pointed out that the Yeovil factory is under threat basically because contracts have been given to Boeing, as they have for several other projects. Even when we have a superior product such as Brimstone, the Ministry of Defence cravenly gives in, keeps handing out those contracts and gets nothing in return.
As I said in the earlier debate on trade, no other country in the world behaves like that. I do not understand why Ministers do not stand up for Britain and for defence and get a grip. Otherwise, what is the point of them?
Independent Expert Panel
Debate between Lord Spellar and Lord Beamish(4 years ago)
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Mr Kevan Jones
My right hon. Friend was, like me, a trade union official in a former life and will have dealt with capable personnel managers, as they were in my day—human resources managers, as they are now. Would it not have been helpful to at least have had someone on this panel from an HR background, and possibly someone from a trade union who has actually represented people in the types of cases this panel is going to be dealing with?
John Spellar
Very much so. Such people are used to engaging with people and having to make decisions. We could have a senior nursing officer in an accident and emergency department or a senior matron in a hospital. Do they not see life? Do they not have to make decisions? Do they not have to weigh up what people are telling them? We could have retired police officers on the panel, as they are used to weighing up evidence. We must get away from this elitist concept that only lawyers are able to be above all this sort of thing.
I wish to mention the very substantial salary, which seems at variance with the advertisement. These retired judges will be on a stonking pension—we know about that because they are always complaining any time the Treasury has the temerity to try to keep their pensions in line with the pensions being imposed on other parts of the public service.
The approach being taken is also at variance with the advertisement, which said clearly that the people should have
“substantial and very senior experience in a judicial, quasi-judicial, or adjudicating capacity, or bring expertise in a relevant policy area, such as an employee or industrial relations or HR disciplinary processes.”
Of course, if we have a panel where two of those involved are part of the Bar Council or the judiciary, and we bring in headhunters, they are all part of the same social circle. I am sure the individuals would probably be very agreeable dinner table companions, but that does not mean they have wisdom or experience that outweighs that of the rest of the population, nor does it mean that we should have a pretty homogeneous group, rather than having a balance.
If we have a panel, we should have people with different realms of experience, because that would work—one for the other. Not just for this appointment, but right across the many appointments we have involvement in, the people all come from a very narrow band. We ought to be looking at the construction worker, the factory worker, the nurse and the care home assistant. I accept that we would be having people who were in a more senior representative or managerial role, as outlined in the job description. We could have somebody who is in charge of a major unit in a major retail environment. These are people with life experience.
Mr Jones
Does my right hon. Friend agree that it would have been helpful to have had someone from the third sector on this panel, for example someone dealing with domestic violence and related issues? Many of those very able individuals could have stepped into this role well and added something to it.
John Spellar
Indeed. We could have people who have gone into those roles, often later in life, with a range of life experience, as opposed to people who have gone from elite school to elite university, then to chambers and into the courts, where they have done well, doing their public duty as judges. They may observe a bit of life, but that is very different from living it. [Interruption.] The Leader of the House seems a little distracted by his colleague. If he would care to listen to the debate rather than to the Whips, it would be rather courteous and it might even be valuable. The fact is that we ought to look at all appointments and not automatically go to so-called headhunters who just go to the people they know. We need to broaden this out. We need to ask the CBI and the Trades Union Congress. Interestingly enough, back in the day when we were looking at Members’ expenses, we came up with a much better scheme, ultimately, than the Independent Parliamentary Standards Authority. The House invited the CBI and the TUC to each nominate two people, who gave up their time to do it. They made an excellent contribution because they understood what they were talking about. We need to get away from elitism.
I will continue to raise these issues, because they make us not even semi-detached but detached from the public we serve. Ultimately, Members of Parliament are here to represent the public. We need to be accountable mainly to them, and stop imposing elite individuals and an elite culture.
Horizon Settlement: Future Governance of Post Office Ltd
Debate between Lord Spellar and Lord Beamish(4 years, 8 months ago)
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Mr Jones
It was even worse than that: for many years the Post Office denied that that could ever be done. It was only in 2011, after campaigning by me and others, that the Post Office had the forensic accountants Second Sight take a look, and it discovered exactly what the hon. Gentleman has just outlined. But what does the Post Office do? It set up a mediation service, but still denied that there was any problem, even though the evidence was there.
As for the operator, Fujitsu, it knew that there were glitches. Indeed, I have to say that it is as guilty of the cover-up as the Post Office. I cannot comment on the judgment—I think the judge has possibly referred the case to the Crown Prosecution Service to get its involvement, so I do not really want to go into the detail—but Fujitsu has a lot to answer for.
John Spellar (Warley) (Lab)
My right hon. Friend is outlining a litany of maladministration at the very least. Have any individuals at management level in either at Post Office Ltd or Fujitsu ever been held accountable for this?
Mr Jones
I shall come to that, which is a very good point. The complete opposite: most have been promoted or, in one case, appointed as a Government adviser when she left the Post Office.
That denial then led the postmasters to get the group action together, with 555 taking the Post Office to court. The Post Office was still denying that there was a problem when it went into court; indeed, its consistent approach has been to deny any type of liability.
Let me turn to the role of the Post Office and that of Government. The Post Office is an arm’s length body from Government, but the sole shareholder is the Government. They have a shareholder representative on the board. Despite that, millions of pounds of public money are spent every year. In fact, it is a nationalised company, whether we like it or not.
But we are unable, as parliamentarians, to scrutinise the Post Office. For example, in spite of what it knew, it is estimated that the Post Office spent between £100 million and £120 million defending the indefensible in court. That was basically designed to whittle down the case, so that the other side ran out of money. Trying to scrutinise the Post Office and get it to account for that is virtually impossible. When I have asked parliamentary questions, they are referred to the Post Office. I will come on to the role of Ministers, but I am sorry that the right hon. Member for Kingston and Surbiton (Sir Edward Davey) is no longer in his place, because I would have liked him to answer for his role—or lack of role—when he was the Minister.
The Post Office falls somewhere between a private company and a public company, but then there are the individuals involved, as my right hon. Friend the Member for Warley (John Spellar) said. Paula Vennells was the chief executive of the Post Office. She left last year. Obviously, as a board member she knew what was going on, including the strategy in the court case and the bugs in the system. What happened? She got a CBE in the new year’s honours list for services to the Post Office. That is just rubbing salt into the wounds of these innocent people. There is a case for her having that honour removed, and I would like to know how she got it in the first place when the court case is ongoing. Added to that, she is now chair of Imperial College Healthcare NHS Trust. Again, I would like to know why and what due diligence was done on her as an individual.
Mr Jones
I do not know whether the hon. Lady has read my speech, but I am just coming on to the Cabinet Office, because lo and behold, guess where Paula Vennells also ended up? She was a non-executive member of the Cabinet Office. I am told that she was removed from that post yesterday; I do not know whether it was because of this debate. I welcome that, but why is someone who has overseen this absolute scandal still allowed to hold public positions? Worse than that, she is a priest. I respect those who have religious faith, and she does, but the way that she has treated these people cannot be described as very Christian—she certainly would not pass the good Samaritan test, given the way she has ignored their pleas. I hope she thinks about people like Tom, who have lost their livelihoods and are now living in social housing because of her actions. It angers me that these individuals have gone scot-free, and they need to be answerable for their actions.
John Spellar
Maybe she fulfils the role of the Pharisee in that parable. Does this not also speak to a deeper problem in our society, where relentlessly, time after time, the great and the good look after each other and hand out these positions to each other, irrespective of whether they have been successful or a massive failure? We see that particularly in the health service, where people move from job to job, taking payments each time they go and leaving catastrophic failures. Is this not a deeper failure in the system?
Mr Jones
It is, but how could somebody be given a CBE when this scandal was out there? How could somebody be appointed to the non-executive board of the Cabinet Office and a healthcare trust, given what is coming out of this court case? I find that remarkable.
Then there is the role of Government. When the right hon. Member for Kingston and Surbiton was the Minister, he said that the Post Office
“continues to express full confidence in the integrity and robustness of the Horizon system and also categorically states that there is no remote access to the system or to individual branch terminals which would allow accounting records to be manipulated in any way.”
That is despite a board minute of 2009 which said that remote access was possible. What his role in it was I do not know, but he clearly did not ask many searching questions of the Post Office.
I turn to how we scrutinise the Post Office. I have tabled numerous written parliamentary questions, but because the Post Office is an arm’s length body, the Department for Business, Energy and Industrial Strategy shift them over to the Post Office—it is at arm’s length, and therefore it is nothing to do with the Department. There is a question here about how we can scrutinise the Post Office. This week, I asked a question about what the complex case review team in the Post Office is. My able assistant rang BEIS and asked, “What is it?” BEIS did not even know about it. The parliamentary question has now been given to the Ministry of Justice, but it does not know what that team is. I know that last week two cases were settled out of court, each for £300,000. This is public money we are talking about here, and we need full scrutiny. I would love to see whether the Minister can shed some light on what this organisation actually is.
Then we come to the role of Ministers. I have already mentioned the right hon. Member for Kingston and Surbiton, but Jo Swinson, Claire Perry and the Minister’s immediate predecessor the hon. Member for Rochester and Strood (Kelly Tolhurst) were all involved. They all completely believed what they were being told by the Post Office, never asked any questions about how public money was being spent and allowed the Post Office to continue what it has been doing. The Government cannot say that they never knew about this, because when the new Government came to power in 2010, myself, James Arbuthnot and the hon. Member for North West Leicestershire went to see Oliver Letwin, then a Cabinet Office Minister, to put our case to him. He had sympathy for it, because he had a similar case in his constituency. What happened to that? Nothing happened at all. Clearly there is an issue that the Government cannot hide from it.