Defence and Security Review (NATO)

Lord Beamish Excerpts

Monday 2nd March 2015 Commons Chamber

[Mr Kevan Jones (North Durham) (Lab)]

This has been a very well-informed debate in which we have had 15 speakers. I congratulate the hon. Member for Penrith and The Border (Rory Stewart) on his opening remarks, which showed that the House made the right choice in selecting him as Chair of the Defence Committee. He not only put forward his usual well-informed arguments but made a very convincing case for why we are facing certain threats from Russia, in particular.

The main issue has been spending 2% of GDP for our NATO commitments. That was mentioned by the hon. Gentleman, by the right hon. Member for Mid Sussex (Sir Nicholas Soames), by my hon. Friends the Members for York Central (Sir Hugh Bayley) and for Birmingham, Edgbaston (Ms Stuart), by the hon. Member for Gosport (Caroline Dinenage), by my hon. Friend the Member for Ilford South (Mike Gapes), by the hon. Members for Aldershot (Sir Gerald Howarth) and for North Wiltshire (Mr Gray), and by the hon. Member for Newbury (Richard Benyon), who called the 2% figure a line in the sand. The hon. Member for New Forest East (Dr Lewis) also spoke in favour of it, as did the weaponised dove, the hon. Member for Reigate (Crispin Blunt), who argued for more than 2%, and the hon. Member for Stroud (Neil Carmichael).

[Crispin Blunt]

I am interested in exploring what Labour would do. In 1977, even when the economy was a disaster, a Labour Government committed to a 3% year-on-year increase in defence expenditure at a time when we were facing a similar threat scenario to that which we face today. Is Labour committed even to a 2% floor?

[Mr Jones]

If the hon. Gentleman lets me get on with my speech, I shall tell him what our position is.

Every Conservative Member has called for 2% or more, but in a few weeks’ time they are going to stand for election on a manifesto that would see a cut in our defence expenditure. I refer to the Chancellor of the Exchequer’s autumn statement, which clearly ring-fenced spending on schools, health, and overseas aid. The hon. Member for Aldershot mentioned overseas aid, which I know is dear to his heart. According to the Office for Budget Responsibility, 60% more cuts have got to take place, so if we take the ring-fenced spending out, we see that the rest of the cuts that will have to be made amount to about £86 billion. Of that, it is estimated that £9 billion will have to come from defence—some 36% if we take the figures up to 2020. Some are saying that the figure may be in the region of 8%. The Conservatives have form on 8% margins, because that is the level at which the coalition cut defence expenditure when it came to power.

We have heard it argued that the Prime Minister gave a commitment to, and lectured others about, the 2% NATO target. I understand that today he has been in the constituency of the hon. Member for Colchester (Sir Bob Russell), where he was asked about the commitment to 2%. As we expect from the Prime Minister, he dodged the question. He said that the equipment budget would be increased by 1%. He also made the remarkable statement that there would be no further cuts in the size of the Army. In that case, the situation for the defence budget is even worse than has been said, because the 9% cut that the Chancellor is arguing for will fall on only 55% of the budget. If the equipment budget has been protected, there are only two ways of keeping the Army intact while cutting 55% of the defence budget by 9%—by taking out of service equipment that is there today or by reducing the number of personnel.

The Prime Minister needs to level with the British people and be honest about what is being proposed. This is a charade. I do not doubt that the Conservative Members who have spoken—I know them all very well and they are very strong defence advocates—genuinely believe that more money should be put into defence or that the 2% NATO commitment should at least be met, but they need to challenge the Prime Minister on the figure. There is no way that the Chancellor’s cuts can be met by 2019-20 without affecting the 2% we currently give to NATO.

[Mr Gray]

I know that the hon. Gentleman is looking forward to being the Minister for the Armed Forces in the incoming Labour Government. Talking of levelling with the British people, would a Labour Government not do what he says we are about to do?

[Mr Jones]

I will level with the hon. Gentleman. What I will not do is what the Prime Minister and the then Members of the Opposition did at the last election by promising larger armies, more ships and more expenditure on the armed forces. The first thing they did when they got into power was cut the size of the army. Our position is very clear: we will meet the figure for 2015-16, but, as my hon. Friend the Member for York Central has said, that is still a reduction of £600 million according to the figures under discussion. Moreover, if we look at what the Defence Secretary has been good at, we will see that some £400 million has been given back to the Treasury over the past five years. That money was not even spent, which begs a question about the commitment.

Our strategic defence review will look at what most people want, as we did in 1997. It will be a proper defence review that looks at the bigger questions that many Members have raised today about our role in the world.

[Sir Gerald Howarth]

I am grateful to my good friend the shadow Minister for giving way. The reason we are in this pickle is that we inherited a budget deficit of £156 billion. I wonder whether he would accept that putting the public finances back in order was the immediate priority and that we have been successful in doing so. [Interruption.] We now have the fastest growing economy in the western world and that is why we want a 2%-plus increase in defence.

[Mr Jones]

But the hon. Gentleman needs to be honest about the time scale. I thought he was going to refer, as one Member did from a sedentary position, to the mythical £38 billion black hole, which was designed to disguise the Government’s 8% cut. The Defence Committee’s report of November 2011 says:

“We note that the MoD now state the genuine size of the gap is substantially in excess of £38 billion. However, we also note the”

former

“Secretary of State’s assertion that the ‘for the first time in a generation, the MoD will have brought its plans and budget broadly into balance, allowing it to plan with confidence for the delivery of the future equipment programme’. Without proper detailed figures neither statement can be verified.”

I have challenged numerous Ministers on that. It is one of those things that was thought up in central office during the election and then kept getting repeated.

Serious points have been made in today’s debate about Britain’s place in the world, including by my hon. Friend the Member for Birmingham, Edgbaston and the Chair of the Committee. We need to ask the question that we asked in 1998: what is our role in the world and is there a wider debate to be had with the British public? I think there is, but this Government are not conducting the latest defence review in a constructive way. In 1998, as the hon. Member for New Forest East has said, we had a broad, inclusive debate. Even in 2010 we produced a Government Green Paper setting out the issues, but as soon as the coalition got in the Treasury-led review was completed in record time. This time the process needs to be thought out.

Things do not bode well, however, because the Ministry of Defence will not even tell my hon. Friend the Member for Gedling (Vernon Coaker) what questions it will ask in the review, while the Prime Minister’s view is that all we need is a light tweak. We live in a very changeable world—we have had a very good debate today about Russia and the threats we now face from Islamic terrorism—and the idea that all we need is a light tweak is a huge mistake.

[Neil Carmichael]

Will the shadow Minister tell the House whether or not the Labour Opposition agree with the 2% target?

[Mr Jones]

I have made that clear. I will not promise things I cannot deliver, which the hon. Gentleman’s party did at the last election. He will have to stand up in front of his electorate in Stroud in May and say that he disagrees with the Prime Minister and will not sign up to the austerity Budget outlined by the Chancellor in the autumn statement. He needs to be honest with his constituents by saying that, because that is what will happen to the defence budget. He can make all his points about our position, but we have been very clear that we will meet the 2015-16 targets.

The hon. Member for Broadland (Mr Simpson)—I will call my fellow war graves commissioner my hon. Friend—made this point about those in the Ministry of Defence. I think he said that they were rolling the logs along the path, and they have in certain ways. What is needed, and this is part of our zero-based budget review, is to look in detail at exactly how our defence budget is spent. There is an argument for efficiencies that can be made, and they will be made.

The defence review must involve the largest possible number of people; otherwise it cannot be done. If the Treasury is just let loose, as it was in 2010, it will have the same result. I will say something that is perhaps out of character, but when he was Defence Secretary the right hon. Member for North Somerset (Dr Fox) did at least try to keep the Treasury dogs from the door, although he unfortunately failed.

[Mr Keith Simpson]

Does not the hon. Gentleman, as well as my hon. Friends, accept that we can all caricature the Treasury for obvious reasons, such as in 1998 and 2010, but if we sat in the Treasury and looked at the way in which the Ministry of Defence under successive Governments has been totally incompetent—in handling budgets, the overruns and the way in which individual services have competed with each other—to the detriment of national defence, surely we would agree that decisions should be collective? The Treasury does not necessarily have to have a veto, but it has a point of view and should be listened to.

[Mr Jones]

I do not disagree with the hon. Gentleman. When I chaired the value for money group in the MOD during the previous Government, it was certainly my experience that the Treasury can make a contribution. Unfortunately, it sometimes has a very blinkered view of the world, but it has to ensure that every defence pound we spend is actually well spent.

May I turn to the issue of soft power, which was raised by my hon. Friend the Member for Ilford South and by the Chairman of the Select Committee, the hon. Member for Penrith and The Border? I always think “soft power” is a strange use of words because when we look at what is happening in Russia, we can see that its use has been very effective. Soft power is part of the Russian strategy not only in changing the complete news agenda on the invasion of Crimea, but in continuing to do the same. My hon. Friend the Member for Ilford South made his point in relation to the World Service, which is again a case of a short-term saving having long-term consequences. We need to address the issue that what might be seen as public relations or news management is clearly part of the Russian armoury for changing the agenda on Ukraine and other parts of the world. We need a similar type of force to make sure that we not only influence the debate, but can react very quickly to events as they happen.

The hon. Member for Colchester raised issues about the Falkland Islands. The Labour party is certainly committed to ensuring that the people of the Falkland Islands determine their own future, but that must be taken into account in the future defence and security review. Given his long-standing interest in housing, I am surprised that he has not thanked the Labour Government for the investment they put into Colchester and Army housing. It was sad that when this Government came to power they stopped the modernisation programme as well as the scheme that allowed members of the armed forces to buy their houses, although I know that has now been resurrected under a different heading.

The threats we face are numerous. Can we predict the future? No we cannot. We must ensure that the armed forces at our disposal are linked not only to our security networks and to MI5 and MI6, but to our homeland defence. That can be achieved only if a proper security and defence review in 2016 covers all those aspects, so that when we need the brave servicemen and women on whom we rely, we can ensure that they have the equipment and training to carry out that role. We must also deter aggressors who are clearly working to affect the way of life that we have all come to respect and take for granted.

[The Minister for the Armed Forces (Mr Mark Francois)]

I, too, thank the House of Commons Defence Committee for producing this important report and giving us the platform to discuss some of the key defence issues facing the alliance and the United Kingdom today. The Chair of the Committee introduced the debate in characteristically eloquent fashion, on which he was complimented by a number of hon. Members. I will add to those compliments and point out that I think he gave a very forceful opening speech.

The report makes interesting reading. It argues in paragraph 102 that events in Ukraine were a “wake-up call”, and for reasons that I will come on to, I agree. As the Committee acknowledges in paragraph 97, these issues are not just a matter for the Ministry of Defence, but for the whole Government. The pan-governmental national security strategy will need to be updated to take account of changes to the international situation over the last five years. The importance of the NSS was referred to by the Committee Chair, as well as by my hon. Friends the Members for Broadland (Mr Simpson), for North Wiltshire (Mr Gray) and for Stroud (Neil Carmichael). Although this debate has understandably focused on the strategic defence and security review, the next SDSR must also take account of any changes to the NSS into which it should dovetail. As the Committee recognises, events in Ukraine have shone a light on different types of conflict that the NSS must take into account as it develops strategies to mitigate the challenges we face.

The last SDSR was written while our forces were heavily engaged in Afghanistan. We have now brought our combat troops home, but as we move to an era where there is a continuing challenge to the rules-based international order, we must examine the full scope of defence to ensure that we are best prepared. Equipment, people and investment are key elements, but mindset is important too.

Arguably, the last 10 years or so have seen us become increasingly proficient at conducting combat operations with a counter-insurgency element, at reach, against a technologically inferior but none the less determined enemy. In that context I pay tribute again to those who served us in Afghanistan. We asked much of them and they did us proud. I was at the last homecoming parade into the Palace of Westminster for the troops of 102 Logistic Brigade and the 20th Armoured Infantry Brigade. It was a humbling experience and I pay particular tribute to the 453 service personnel who lost their lives in that conflict. Across the whole House we will surely agree that they must never be forgotten.

We now need to rebalance and become highly proficient in a range of potential operations across the globe, and against a range of potential threats. We will need to think differently; we may need to react quicker. We will need to look into the future and seek to prepare now. The world does not stand still and events will not give us rest: there is ISIL in the middle east, referred to by several hon. Members; Boko Haram in Africa; and of course our commitment to combat Ebola in Sierra Leone via Operation Gritrock. Having visited our troops just prior to Christmas—the Secretary of State visited more recently—I place on the record my enduring admiration for our armed forces personnel. They have been prepared to take risks in deploying to west Africa to fight this awful disease, not just to defend the Sierra Leoneans but us here at home.

On the defence review itself, there is an old saying about how to get to Dublin. In short, I would rather start an SDSR from where we are now than where we were in 2010. The chaos we inherited from Labour has gone and the budget is now back in balance. The hon. Member for North Durham (Mr Jones)—he and I have been sparring partners for some years—refused to commit the Labour party to spending more than 2% on defence beyond 2015-16, if it was elected. In that sense, he does not go beyond us. The giveaway was when he said that Labour would conduct a zero-based review. In essence, that means he cannot commit to anything. That is what a zero-based review means. He told the House on the one hand that he would not promise anything he could not deliver, but on the other hand he said that his party would conduct a zero-based review, in which it cannot really promise anything. It is important that the House understands the distinction between the positions held by the Opposition and the Government.

Our equipment programme—a substantial investment of some £163 billion over 10 years on equipment and support—will ensure that our armed forces retain a formidable range of cutting-edge capabilities and the ability to project power across the globe. This investment is not only securing the best possible military capability, it is also helping to secure UK jobs and growth. The UK defence industry indirectly employs more than 160,000 people, with a turnover of £22 billion.

[Mr Kevan Jones]

A zero-based budget looks at efficiencies and how to spend money better. Does the Minister agree with the Chancellor’s figures for 2016 to 2020, when something like £9 billion has been projected to meet the cuts—[Interruption.] The Whip has not been here, so he can stop chuntering from a sedentary position. Does the Minister agree with the Chancellor, yes or no?

[Mr Francois]

What I agree with is that we inherited a chaotic defence budget from the Labour party. That is what it bequeathed to us and that is what we have had to deal with from day one. I will come on to our position on the 2% commitment, which I believe is superior to the hon. Gentleman’s position.

Crucially, we are making full provision for the successor deterrent system. It is a shame that the hon. Member for Barrow and Furness (John Woodcock) is no longer in his place, as I wanted to tell him two things. I will be visiting Barrow very shortly. We will confirm the date with him in the usual way, but I want to see Barrow for myself. He also asked for a commitment, which I am happy to give him, to the seventh Astute submarine. We are determined that we will complete the seven boats in the Astute programme before transiting to a successor programme based on continuous-at-sea deterrence with four deterrent submarines.

We are also significantly increasing our investment in cyber-security, an issue raised by a number of hon. Members. I can assure the House that this does not relate only to defensive cyber. We need to ensure our armed forces are equipped with cutting-edge capabilities across all environments.

On the NATO summit and events in Ukraine, we have deplored Russian aggression in Ukraine from the outset. We urge all sides to take the necessary steps to implement the second Minsk agreement of 12 February, which provides a framework for stabilising the situation in eastern Ukraine. Russia must abide by its commitments at Minsk. This means making the separatists withdraw their heavy weapons, stopping continued separatist attacks so that an effective ceasefire can take hold, and allowing effective monitoring to take place. There have been some early encouraging signs over the past few days, with a lull in the level of fighting in the east and some heavy weapons relocated, but we have seen this pattern before. We will continue to monitor the situation and hope that it is not reversed. It is important that we look at actual deeds in this context and follow them closely.

Unity in the alliance is the best response to these challenges. We demonstrated that at the Wales summit, in particular with the readiness action plan, including the development of a very high readiness joint task force. On 5 February this year, at the NATO defence ministerial, the UK committed to lead the VJTF in 2017, as one of six framework nations, alongside France, Germany, Italy, Poland and Spain. The Wales summit saw the alliance commit to assurance measures for our eastern allies. Our contribution will be even greater in 2015 than last year, with over 4,000 UK personnel set to deploy on various exercises in eastern alliance territory. In particular, Exercise Dragon will be a divisional level exercise in Poland—something that I note the Chairman of the Select Committee called for in his speech. It is due to take place in September and the UK will contribute 1,000 troops, plus armoured vehicles. We will also participate in Baltic air policing. Four Typhoons will operate alongside Norwegian aircraft between May and August 2015, working to secure NATO’s airspace over our Baltic allies, demonstrating alliance solidarity in practice.

The Wales summit also committed NATO allies to reverse the decline in defence spending. The UK is one of the few NATO nations to have consistently spent 2% of GDP on defence. Importantly, we also exceed the target to invest more than 20% of our budget on equipment. We have the second biggest defence budget in NATO and the largest in the European Union. These are important points that we should not forget. In financial year 2015-16, we will maintain that 2% of spending. Following 2015-16, that will be subject to the next spending review, which is due to take place after the election, but it will not be a zero-based review, in the way that Labour argues.

[Mr Jones]

Will the Minister give way?

[Mr Francois]

No. The hon. Gentleman has already had his go and I have three minutes left.

The UK has committed to providing additional non-lethal support to the Ukrainian Government to help their forces deal with the pressures they are facing. Such support is not new, with the nature of the UK’s support remaining non-lethal. This forms part of a wider Government effort to support Ukraine and ensure a robust international response to Russia’s aggression. It is imperative that the United Kingdom stands by its NATO allies in delivering a unified message to Russia about its unacceptable behaviour and disregard for the international rules-based system.

Let me conclude by saying that it is important to remember that the Committee’s report was written last July, prior to the summit, but recent events in Ukraine have indeed been a wake-up call. I reiterate that in the light of this we must look at the SDSR and the NSS. We need to update both, and they must be complementary. The Committee recommended changes in the alliance, some of which have already been implemented. The Committee sought improvements on NATO’s rapid reaction force; the VJTF will contribute to this aim. The Committee wanted large-scale military exercises; Exercise Dragon this autumn will be a divisional sized exercise, consisting of 10,000 alliance personnel, 1,000 of whom will be British, who will be supported with a range of armoured vehicles. The Committee recommended that NATO address its vulnerability to asymmetric attack; work is in train that is seeing NATO significantly improve its resilience to hybrid warfare, not least in cyber, as I have already explained. Units such as the 77 Brigade, to which my hon. Friend the Member for Newbury (Richard Benyon) referred and which is based in his constituency, will also play an important part in that, ensuring that such threats can be covered off.

The Committee is quite right to draw the House’s attention to what has been happening in Ukraine. It is right that we watch these events closely and take nothing for granted. Defence is, and remains, the first duty of Government, so now is not the time to slacken. We must stay the course, implement the decisions from Wales and demonstrate our commitment to NATO. We must at all times remember the importance of solidarity in the NATO alliance. NATO has formed the bedrock of our security since 1949. It still does. We remain fully committed to our NATO allies, and everyone should understand that. NATO has helped to keep us safe and free. It has been committed to us, and we remain committed to it.

Question deferred until tomorrow at Seven o’clock (Standing Order No. 54).