Defence Equipment and Support

Lord Burnett Excerpts

Tuesday 17th July 2012 Lords Chamber

[Lord Astor of Hever]

My Lords, the noble and gallant Lord makes a good point. As we said in the Statement, no decision will be taken until the end of the year. We want to discuss this with as many people as possible, not least our own workers and the trade unions, so I can reassure the noble and gallant Lord.

[Lord Burnett]

My Lords, I endorse the point that my noble friend has made: we should have a debate not only on this matter, but on many other matters. Perhaps a debate will go some way towards highlighting the matters that the noble and gallant Lord, Lord Stirrup, mentioned. We have had severe and deep cuts to the Army, and questions as to the inequitable nature of the redundancy payments and of the capacity and capability of the reserves, however willing they are. But on this matter, will my noble friend explain the advantages to the Armed Forces of privatising the Defence Equipment and Support organisation? I hope that factors such as security of supply, urgency, value for money, secrecy and commitment are paramount in the minds of those who are deciding this policy.

[Lord Astor of Hever]

My Lords, I would certainly welcome a debate on this subject, not least of all because it would give me more time to swot up on a complicated subject. As for the advantages of privatising Defence Equipment and Support, and as far as the Armed Forces are concerned, there is a compelling case for reform. Analysis has shown that cost and schedule overruns have resulted in significant additional cost to the defence budget of the order of hundreds of millions of pounds each year. A GOCO offers the greatest likelihood of focused and sustained improvement. It has the strongest incentive for culture change and a drive for productivity. The Armed Forces will benefit from getting equipment and services on time and at the right price.