EU Security Action for Europe Programme

Lord Coaker Excerpts

Monday 20th July 2026 Lords Chamber

[Lord Teverson]

To ask His Majesty’s Government what recent steps they have taken to explore the UK’s participation in the EU’s Security Action for Europe programme.

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords, the Government entered SAFE negotiations in good faith, but will only enter into agreements that are in the national interest. While no SAFE agreement was reached, we remain committed to EU co-operation under “NATO first”, whether through SAFE or other initiatives. It makes sense for Europe to work more closely together. In this context, we welcome the UK’s participation in the EU’s €90 billion Ukraine support loan, announced last week.

[Lord Teverson (LD)]

My Lords, I also very much welcome that announcement and I agree that the price tag from the EU was totally unreasonable on the first round. The fact that the defence sector in Europe is divided is an indication of weakness in the West and a gift to Putin. Will the Minister and the Government renew their efforts to find a sensible solution to joining SAFE? If the Canadians can, surely the United Kingdom can.

[Lord Coaker (Lab)]

Of course, we remain committed to co-operating where it is in the national interest to do so, as I said. The noble Lord is right to point out that it is in all our interests for Europe to co-operate on industry and defence to generate the interoperability that we need to cope with any threat from Russia. That takes place within the overall umbrella of NATO. As he and all noble Lords know, the defence industry is a vital component of any means by which we deter any adversary; for them to believe that we can arm and supply the troops we put on the front line is crucial.

[Baroness Antrobus (Lab)]

My Lords, in this week of the Farnborough air show, and following the excellent Global Air & Space Chiefs’ Conference last week, which I attended, does the Minister agree that these opportunities for us to bring together our European counterparts and, importantly, European industries are significant events in our annual calendar?

[Lord Coaker (Lab)]

Alongside our failure to get an agreement on the SAFE project, as the noble Lord, Lord Teveson, highlighted through his Question, there are numerous initiatives taking place and numerous things happening. My noble friend is right to point out the Farnborough air show, which brings together industry from across Europe and across the globe. It is at those sorts of events where industry can co-operate to provide the equipment and resources that we need to deter any threat. You can see initiative after initiative, and I may get the opportunity to lay them out further on this Question, where we and other European countries have come together to establish defence agreements which take forward all our defence needs.

[Lord Redwood (Con)]

My Lords, I congratulate the Government on not accepting totally unacceptable terms on the first idea from the EU. Can the Minister confirm that our defence contractors can look forward to a very big increase in orders for our own defence requirements, so we do not need to pay a lot of money to get contracts elsewhere?

[Lord Coaker (Lab)]

Of course we want the growth of our own industry, and we want it to have the means to support our UK Armed Forces; that is really important. But our industry and our defence also need exports, so I do not see this as one versus the other. Growing our own industries is important to supply our own Armed Forces, but working with partners to develop exports helps collective defence, and we should pursue that as well.

[Lord Peach (CB)]

My Lords, the word “weaponisation” is in common usage. Does the Minister agree that now is the time to weaponise the defence industry of the whole continent of Europe to meet the scale of the challenges that we need to be ready to deter? Forcing us apart is not the way to do it. Whether through the SAFE initiative or one of the other initiatives that the Minister mentioned, it is now time to get the supply chains of Europe together on a sound financial footing, involving all parts of a weaponised financial system, which would give us an advantage. Does the Minister agree?

[Lord Coaker (Lab)]

I agree with the point made by the noble and gallant Lord. It was best illustrated when, soon after the beginning of the Ukraine conflict, I read in a newspaper that Ukraine had had to retreat: not because it did not have the soldiers or desire to fight but because it did not have the weapons to fight with. That cannot be a situation we allow our allies or ourselves to be in in the future. The ability to keep your own forces and those of your allies supplied is absolutely crucial to any conflict. As the noble and gallant Lord pointed out, preparing for war is one sure way of preventing war.

[Baroness Smith of Newnham (LD)]

My Lords, the Minister suggested that he might have an opportunity to talk a bit more about bilateral and other relations. When this Government took office barely two years ago, a lot of preparatory work had been done, for example between John Healey and Boris Pistorius on a British-German relationship on defence. Can the Minister confirm that the sort of work that has been going on for the last two years to strengthen bilateral defence relations will continue and that a change of Prime Minister and other personnel is not going to impede the effective work that is being done?

[Lord Coaker (Lab)]

I can confirm that. Clearly, it is in all our interests that, alongside the collective agreements we seek, we also seek individual agreements, as the noble Baroness pointed out. She will already know of our agreement on frigate building with Norway, the recent announcement with the Netherlands on amphibious ships, the typhoon arrangement with Türkiye, the individual arrangements with Germany and France, and there are many others. The bilateral relationships that we have with other countries, and the bilateral agreements to rebuild our industries, are crucial to building the defence industrial base we need.

[Lord Evans of Rainow (Con)]

My Lords, I congratulate our new Prime Minister: he was a good MP for Leigh and Mayor of Manchester. In the interest of our country, I wish him every success. Last week, I met with military chiefs at NATO headquarters in Brussels, and they told me of their profound concerns about the outgoing Prime Minister’s defence investment plan, which led to the resignation of his Defence Secretary and Minister for Veterans. Will the new Prime Minister reopen the defence investment plan, in order to fund our defence properly? Will he also have the good sense to keep the Minister in his place?

[Lord Coaker (Lab)]

Well, I agree with the beginning and end of the noble Lord’s question. As he knows, we have had debate and discussion about the defence investment plan, and we will continue to do so. We have heard the Prime Minister talk about the importance of defence and the noble Lord will know that, as it stands, we have a defence investment programme and a commitment to raise the £4.7 billion in the 2026 Budget. He will also know that defence and security will be the number one priority of the 2027 spending review. It is then that further discussions will no doubt take place about how we move forward with the defence investment plan we currently have.

[Lord West of Spithead (Lab)]

My Lords, can my noble friend the Minister confirm that discussions are still going on with Germany about its involvement in the global combat aircraft work?

[Lord Coaker (Lab)]

I say to my noble friend Lord West that there are discussions with a wide range of people. The confirmation of the GCAP within the DIP was a hugely significant event and a number of discussions are ongoing at the present time with a small number of different countries on how that develops and is taken forward. That is all I wish to say at the present time.

[Lord Hannay of Chiswick (CB)]

My Lords, would the Minister agree that this is one case and one sector where the postponement of the EU-UK meeting from this month to the autumn provides an opportunity, and that there is a great necessity to ensure there is a defence element in anything that is agreed in the autumn?

[Lord Coaker (Lab)]

I agree with that. The defence and security partnership signed in May 2025 between the EU and the UK was a significant step forward. There will be a further summit, as and when it is arranged. For obvious reasons, it had to be postponed, but, as the noble Lord pointed out, it is a significant event, and we will continue to pursue that.

Strait of Hormuz: Merchant Shipping

Lord Coaker Excerpts

Monday 20th July 2026 Lords Chamber

[Lord West of Spithead]

To ask His Majesty’s Government what steps they are taking to assist in opening the Strait of Hormuz to merchant traffic; and what advice is being given by the United Kingdom Maritime Trade Operations (UKMTO) Centre to UK merchant shipping.

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords, I start by paying tribute to the US service personnel killed or injured in the region recently. All our thoughts and prayers are with their families and friends.

The Government remain committed to supporting the safe and secure flow of merchant shipping through the Strait of Hormuz, a vital route for global trade, energy supplies and international stability. Respect for sovereignty over territorial seas and freedom of navigation are fundamental principles of international law. We stand ready to deploy the wider multinational military mission to support freedom of navigation, should conditions allow. We continue to work closely with international partners, the International Maritime Organization and the shipping industry to support the resumption of normal maritime traffic through the strait. The United Kingdom Maritime Trade Operations Centre continues to provide timely security information and situational awareness.

[Lord West of Spithead (Lab)]

My Lords, we cannot allow the highly damaging closure of the Strait of Hormuz to continue indefinitely. We have two bases in the Middle East, HMS “Jufair” in Bahrain and Duqm in Oman. They were established to support our ships that were there to help the American Fifth Fleet and others in ensuring that the Strait of Hormuz stayed open, but that clearly is not happening. Does my noble friend the Minister believe that the time has come—we have the “Lyme Bay” out there, with minesweeping assets, along with HMS “Dragon”, which is a destroyer —to give more help to the Americans purely with the clearance of the straits? I am not talking about getting involved with their larger war, which one might have different views about, but those straits are so important that we cannot allow them just to be kept closed, with all the damage that that is doing to the world economy and the risk to other straits around the world.

[Lord Coaker (Lab)]

I thank my noble friend for his question. His Majesty’s Government are doing all that they can to see the restoration of a functional ceasefire and to bring about a de-escalation of the situation in the Strait of Hormuz. As my noble friend says, the opening of the strait as an international waterway that is safe and secure is of benefit to us all. Through the multinational military mission, we continue to seek the permissive environment that would allow us to ensure that shipping had the confidence to use the Strait of Hormuz. He points to RFA “Lyme Bay” and HMS “Dragon”, which are in the region to support that permissive environment. We hope that can be brought about as soon as possible.

[Baroness Stuart of Edgbaston (CB)]

My Lords, I declare my interest as an honorary captain in the Royal Navy Reserve. I draw the Minister’s attention to the welfare of the seafarers in the Merchant Navy. While those ships are blocked in the straits, a lot of their seafarers have been onboard for a long time. I wonder what more His Majesty’s Government can do to support them.

[Lord Coaker (Lab)]

The RFA provides a crucial service for the Royal Navy and our operations across the region and the world. My noble friend is right to point out the importance of that crew. We continue to discuss with them, their unions and their crews how we can support them in respect of their welfare, because we recognise the significance and importance of those crews.

[Lord Robathan (Con)]

My Lords, I used to deal with mines a little, in clearance and so on. What is it that we cannot do now that we used to be able to do? Can we not just clear mines as we used to do, or is that too difficult?

[Lord Coaker (Lab)]

That is an interesting question. I will talk about the way in which the Royal Navy is developing. It used to be that the provision of a mine-hunting ship was the way in which mine-hunting activity was conducted. In looking for an expression of power and symbolism, a mine-hunter still has a role to play, and we still have mine-hunting ship capability. However, as you can see with the development of RFA “Lyme Bay” and the protection that HMS “Dragon” provides for it, should that permissive environment come forward, RFA “Lyme Bay” is the future of providing the mine-hunting capability that the noble Lord rightly points to. We have a big platform upon which there are numerous uncrewed systems, weapons and so on that we can use above, on or under the water. In this case, they provide a real, modern capability and capacity, working with our friends and allies, to deal with mines and to help in respect of the mine clearance.

[Baroness Smith of Newnham (LD)]

My Lords, in two of his answers the Minister has talked about conditions being right and there being consensus, but is not part of the problem that we need to be working now with the United States in particular to persuade it to look for a way that will create those conditions? While the attacks go on between Iran and the United States, the conditions are not going to be there and the problem is not going to be resolved. What conversations are His Majesty’s Government having with the United States?

[Lord Coaker (Lab)]

The noble Baroness makes an important point. We continue to speak to the Americans and discuss with them how we can see an operational and functioning ceasefire restored. The memorandum of understanding worked for a time and we saw an increase in the number of ships using the Strait of Hormuz. From memory, I think that, before the conflict, some 130 ships were using the strait per day; after the memorandum of understanding was signed and was seen to be operating for a number of days, between 20 and 30 ships were using it. That has reduced for obvious reasons—yesterday, there was one ship. Getting a situation in place which has the confidence of all the nations that use the Strait of Hormuz, as a functioning arrangement between Iran and the United States, is clearly in all our interests. We have certainly talked to the Americans about how we might support them in the re-establishment of that.

[Baroness Butler-Sloss (CB)]

My Lords, on the “Today” programme I heard an American former defence expert saying that the US-Iran war had got to such a point that the only thing for the Americans to do was to bomb for the next month. What is the Minister’s view?

[Lord Coaker (Lab)]

We have always said that any support that we have given to the Americans has been for defensive purposes. As the noble and learned Baroness will know, we have continually called for a ceasefire, as it initially was, the maintenance of the memorandum of understanding and the de-escalation of activity by any nation. We stand by that.

[Lord Watts (Lab)]

My Lords, is it not the case that we need to be realistic that the greatest military power in the world cannot put enough arms in that area to resolve the present conflict and the only way this is going to be resolved is by discussion and debate? Does the Minister agree that we need to increase that dialogue?

[Lord Coaker (Lab)]

I agree. The point we continue to make to our friends and allies in the region, and to the Americans, is that, in the end, dialogue, discussion and an agreement acceptable to all are what we all need to work towards. My noble friend is right to point that out, and we will continue to do all we can to bring that about.

[The Earl of Courtown (Con)]

My Lords, it has been reported that the new Prime Minister supports increasing foreign aid spending back up to 0.7% of GDP. The Government have previously confirmed that all the money saved from cutting aid spending has been allocated to the Ministry of Defence. If the United Kingdom wishes to assist in opening the Strait of Hormuz in a meaningful way then our Armed Forces must, as all noble Lords have said, receive the necessary funds and assets. Can the Minister confirm that, if foreign aid spending is increased, the money will not be taken from the defence budget?

[Lord Coaker (Lab)]

I can confirm that it has been government policy for a considerable period to restore aid, as and when the conditions allow, to 0.7%. There is nothing new in that. I heard what the Prime Minister said about his commitment to defence in his speech, so we will see what happens. As I say, it is government policy, as it stands, to restore aid to 0.7% and the Prime Minister made clear his commitment to defence in the remarks he made outside Downing Street. I think that is the answer for the noble Lord.

[Lord Hannay of Chiswick (CB)]

My Lords, will the Minister confirm that, for nearly 30 years after the signature and entry into force of the UN Convention on the Law of the Sea—to which we all subscribe and which considers the Strait of Hormuz to be an international waterway—it was possible to sustain that in the face of Iran not so agreeing, but not by using force? Could that not be an element in a diplomatic approach to this which would cover the extremely important issue of Iran’s nuclear programmes as well, both of which need to be resolved if there is to be peace and security in that region?

[Lord Coaker (Lab)]

The noble Lord makes an interesting and important point. The commitment to the United Nations Convention on the Law of the Sea is an important restatement of the fundamental principle, not only in the Middle East but across the world, of the freedom of navigation. It is an extremely important point and the noble Lord is right to remind us of it. That remains our policy objective with respect to the Strait of Hormuz. It is an international waterway; it should be free and the freedom of navigation should operate there. On the noble Lord’s other point about nuclear, I reread the memorandum of understanding between Iran and the United States, and, for me, that could have been followed through to start addressing many issues, including the nuclear issue that he referred to.

[Baroness Bennett of Manor Castle (GP)]

My Lords, my question follows on from that of the noble and learned Baroness, Lady Butler-Sloss. I stress that I am asking not for any operational information but for a general statement. Are UK bases and UK military assets being used by US forces in the continuing attacks on Iran. Specifically, were they used in the attack on the nuclear power plant under construction at Darkhovin?

[Lord Coaker (Lab)]

I do not often do this, but let me read the advice that I have had about UK bases involved in recent strikes, because I need to be clear that I am getting it right. The noble Baroness said in her opening remark why I would do this, so let me read the points. Our position on this has been consistent. The Government took a decision in Britain’s national interest not to get involved in the initial phase. We have acted in defence of our allies, including by approving the US to use our bases for the specific defensive and limited purposes of destroying Iran’s missiles at source. We remain in close communication with the US, including on our efforts to support the restoration of freedom of navigation through the strait, through our independent and defensive mission.

[Baroness McIntosh of Pickering (Con)]

My Lords, none the less, the military personal in those bases in Oman and Bahrain will be at some degree of risk. What reassurance can the Minister give the House? When I visited Bahrain and Kuwait with HMS “Cumberland” through the Armed Forces Parliamentary Scheme, I was immensely impressed by the work that they do there, so how can we keep them safe?

[Lord Coaker (Lab)]

The reassurance that I can give to the noble Baroness and to the people she knows is this. I can talk about the Ministry of Defence. Meetings have taken place across government, but I personally have met virtually every week with either defence attachés or the ambassadors from the region to talk to them. We have responded to their requests for help and support with respect to their own countries. Doing that helps to support the defence of our own personnel, whether that be people who are living there or our own Armed Forces personnel. I hope that gives the noble Baroness some reassurance that there is continued discussion with and involvement of the ambassadors, reflecting the opinions of their Governments. That is an important way in which we have tried to reassure not only the region but our people there as well.

[Lord Bellingham (Con)]

My Lords, to add to an already very serious situation, is the Minister aware that the Houthis have now launched a naval blockade against the Saudis? What assessment has his department made of the impact that will have on not just Saudi maritime traffic but wider maritime traffic, including our own vessels?

[Lord Coaker (Lab)]

The noble Lord makes an important point. That takes us to the other side of the situation, and the so-called Bab strait, which is a narrow strait on the other side—the western side, if you like—of where we are talking about, rather than the Strait of Hormuz. All I can say is that we keep these things under review and an assessment is currently being made, as I understand it, of the perceived or current threat, and what we may or may not need to do about that.

Future Capability of the Armed Forces

Lord Coaker Excerpts

Thursday 16th July 2026 Lords Chamber

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords, it is a great privilege to respond to this debate. I thank everyone for taking part and I will try to respond to many of their points. I start by declaring an interest: my son-in-law is currently mobilised as a reserve, so I just make your Lordships aware of that.

I congratulate the noble Lord, Lord Harlech, on introducing this debate, on the way he did it and on his own service. We all recognise the importance of that. He made the point that the Armed Forces, the defence of our country and our work with allies and friends is not a party-political matter, as the noble Lord, Lord Bruce, and the noble Baroness, Lady Goldie, demonstrate. It is about how we challenge each other to deliver the best defence that the country needs. That is an extremely important point for all of us, and I am very grateful that it is the attitude across the Chamber.

I will answer some of the specific points from the noble Lords, Lord Harlech and Lord Bruce, and the noble Baroness, Lady Goldie, then move to some other matters. It is important to say at the start that, although much of this debate has been about the future capabilities laid out in the defence investment plan—we can debate and discuss whether it has all the right measures in it to develop our future capabilities and the spending that we will need for them—the concern expressed by many in this debate is about the capabilities that we have now and how we will develop them. That is an interesting debate. I am going to commission the Ministry of Defence to produce a paper that demonstrates what we are doing now and what we intend to do over the next two or three years, and I will put a copy of that in the Library. That will help, because it is important for us to have concrete examples of the sorts of things that are being done now and the sorts of capabilities that the MoD and the Government are saying we will have in the next year, the next two years and so on—not only that but some of the changes that we need to make and things we need to do. That shows that this debate is making a positive contribution to the sorts of things that we are seeking.

I will point to many of the things that are happening, for those who watch and listen to our debates. A number of people have asked what we are doing about Russia at the moment. We have an aircraft carrier in the north Atlantic with F35s all over it and other things around it, deterring the Russians with our NATO friends and allies. What are we doing in the Middle East? RFA “Lyme Bay” is there with a Type 45 destroyer, preparing itself for the reopening of the Strait of Hormuz, I hope. A noble Lord mentioned the Baltic states, and we currently have troops in Estonia. Others mentioned the nuclear deterrent. It is quite rightly being modernised at the present time, which is costing billions of pounds, but is a deterrent not only in Europe but across the world and it contributes to peace. All those things are going on at the current time.

We have Typhoons on quick-reaction alert, in case of incursions or threats to our airspace. It is quite right to challenge what needs to be done now and what should happen in the future. All I say in defence—this will be the only time that I am defensive about this—is that we ought to say to our adversaries alongside this, “We have capabilities that we are using at the present time to deter and to defend our people”. I know that that is accepted, and that there is a belief that we need to do more, but that is the challenge for the Government now and in the future. I hope that the paper that I will commission, a copy of which I will put in the Library, will help.

I come specifically to two or three of the questions posed by the noble Lord, Lord Harlech. He asked about the £4.7 billion gap, as I think he described it. The Treasury clearly confirmed to me, in preparing for this debate, that a further £4.7 billion will be confirmed in the 2026 Budget in a fair and balanced way. That is the information that I have had from the Treasury.

On the question of the ambition for the reserves, the noble Lord knows what is in the Armed Forces Bill currently going through your Lordships’ House. Investment is going into the infrastructure, training and equipment needed to support the reserves, and we recognise the importance of that.

I have answered the point about what we are going to do about current priorities. I think the paper will be of interest not only to the noble Lord, Lord Harlech, but to all of us more generally, particularly the noble Baroness, Lady Goldie, and the noble Lord, Lord Bruce, as the Front-Bench spokespeople for their respective parties. As the shadow Defence Minister for His Majesty’s Opposition, the noble Baroness I think will find it very helpful.

I fundamentally agree with the point made by the noble Lord, Lord Bruce, that you prevent war by preparing for it. I do not like thinking that, but it is a crucial point. A national conversation is important, as a number of noble Lords have said, and soft power is crucial. I wrote the defence diplomacy strategy in the Defence Investment Plan, along with my department, and I shared it with the noble Baroness, Lady Goldie, just before publication. It talks about the importance of soft power and developing those relationships with other countries, as well as hard power, of course. The idea that it is a choice—that you have one or the other—is nonsense. You have to have both alongside each other.

[Lord Bruce of Bennachie (LD)]

I appreciate that, and the Minister and other Ministers frequently say that, but the reality is that the British Council is nearly bankrupt, the BBC is struggling and our diplomatic forces are being reduced. On that particular point, can he feed back to the Government that, if we do not have diplomats on the ground, we are not able to influence the world?

[Lord Coaker (Lab)]

I will feed that back to the department. All I am saying is that there is now a much more co-ordinated, effective diplomatic strategy that links the Foreign Office and the Ministry of Defence together to deliver the objectives that the noble Lord wants.

The noble Baroness, Lady Goldie, made the point about immediate threats. I hope that putting a paper together and putting in the Library will answer the particular questions she asked about what we are doing about those immediate threats, as well as future threats. I say to her that there are difficult decisions to be made. She made difficult decisions when she was in government. This Government made the really difficult decision to replace the Type 83 and Type 32 with the common combat vessel. That will help develop the hybrid Navy that we will need, rather than continuing with vessels that we were advised by the military advisers will not meet the threat in 10 or 15 years’ time. To have a warship that can deliver drone capability, above the surface, on the surface and below, increases the mass available to tackle the threats we face. That is the hybrid Navy concept.

We had the debate and we said, “We’re going to get criticised, you know? They’re going to say, ‘There you go, you’re cutting ships. You’ve taken away this capability and that capability’”. All I would say is that, if I have to take some criticism by doing that with others, because we believe that opens up the opportunity to create the Navy we need, I am willing to take that criticism.

However, I fundamentally agree with the point the noble Baroness made that drones are not the only answer. Of course you need warships, fighter planes and land vehicles—all those things are fundamental—but, alongside that, you need the increased capacity of drones.

On being optimistic, I know that a number of noble Lords were at the retirement of Pedro Serrano, the brilliant EU ambassador to the UK, who said:

“The United Kingdom is one of the most important military powers in Europe with a very important defence industry. If we’re going to be successful, we will be successful together”.


I spotted that when I read the Financial Times, as I normally do in the morning, and I thought, “I’m going to use that”. I am not being sarcastic. In the article, he points to the fact that the UK has joined the €60 billion EU defence loan scheme for Ukraine. The noble Lord, Lord Mott, asked me what the Government were doing to open up opportunities with respect to Ukraine. There is one example that I hope specifically answers the question the noble Lord raised.

I thank my noble friend Lady Carberry for her points about the importance of the defence industry, Rolls-Royce and SMEs. She is absolutely right.

The noble and gallant Lord, Lord Stirrup, made a crucial point about RDEL and CEDL. He has made this point to me before. We made this point in the defence investment plan. I have the figures here. In 2026-27, RDEL was increased by £2.1 billion and CEDL was increased by £0.7 billion, so there was a significant uplift of RDEL rather than CEDL. Next year, it will be £1.6 billion compared to £1.2 billion. We absolutely accept the point about RDEL and CEDL, the necessity to focus not just on capital projects and the importance of resource allocation.

On the point made by the noble Lord, Lord Swire, about partnering more with private capital to try to do that—the defence bond argument—alternative financial mechanisms to support what we do are crucial.

I wish the right reverend Prelate the Bishop of Southwark well for the future. In his valedictory speech, he reminded us of the importance of international humanitarian law. That is important to our country and our democracy. We understand the need to use force sometimes, but we question ourselves about whether we have the legal basis to do so, and I think we should commend ourselves for trying to act, sometimes with force, in a legal way. I wish him well for the future. We all struggle with moral dilemmas, so I look forward to him struggling with that and trying to help others with respect to that when he preaches.

I thank the noble Lord, Lord Ahmad, who spoke about the importance of soft and hard power. He and I have talked long and hard about that. Soft power is crucial, but it is not, as I said before, a choice, as he agrees, between soft and hard power. I totally agree with him about the speed of procurement and trying to deliver things much more quickly. I hope the paper that I am going to ask to be put in the Library will help answer some of the points on that. He asked about the defence readiness Bill. It will be in this Parliament, and it is being worked on as we speak.

I agree with the noble Lord, Lord Hamilton, about complementary groups under NATO. NATO is the crucial umbrella, but underneath that you can have other organisations, such as JEF or whatever, as long as it complements NATO—I think that is particularly important. The role of the US remains crucial. That is the only point I would say. We have to retain the strategic alliance with the US.

[Lord Hamilton of Epsom (Con)]

The JEF point is interesting. Does the Minister agree that, if neutral countries such as Finland and Sweden can join, then so could Ukraine?

[Lord Coaker (Lab)]

That is a matter for discussion between all of us. The relationship with Ukraine remains crucial. How that is taken forward will have to be discussed.

I thank my noble friend Lady Antrobus. We are committed to the nuclear deterrent. I sometimes think we should talk more about it. When people ask what is the UK’s commitment to Europe, it is not a bad start to say that the UK has been committed to the nuclear deterrent for the defence of Europe for decades. It is a proud thing for us to state. I know the point she made about the ladder of escalation and the involvement of tactical nuclear weapons in future through the F35A.

I think the spending review of 2027 will answer some of the points that the noble Baroness, Lady Helic, made about spending. She will recognise the point about defence and security being the number one priority within that.

I agree with the noble and gallant Lord, Lord Craig, about thinking imaginatively as well as responding in a tough way to Russia and about some of the other things that he mentioned in dealing with that.

I say to the noble Lord, Lord Sherbourne, that the Prime Minister-in-waiting clearly means what he says about defending our nation. I thank the noble Lord for his kind words about me.

The noble Lord, Lord Empey, mentioned the national conversation, which is fundamental and crucial to us, and the priorities for the public. Particularly important, as he mentioned, are the grey zone, underwater cables and cyber attacks. Those sorts of things are crucial.

The noble Lord, Lord Risby, talked about space. I take the point about Skynet 5 being extended rather than a new Skynet 6, but when we look in the Defence Investment Plan, as I know he will have done, it is quite interesting. I was looking at it while he was speaking, and on pages 48 and 49 there are some quite interesting investments into space. I understand the importance of space technology and satellites if we are to fight the wars of the future, and the noble Lord is absolutely right to remind us of the importance of all that.

I thank my noble friend Lord Forbes for his points about the whole-of-society approach. By raising the age of reserves to 65, we may be able to recruit more of the engineers, doctors, cyber specialists and so on, as he was talking about.

I say to the noble Baroness, Lady Eaton, that we are accelerating our war readiness plans. The spending debate will continue, but it is going up; the debate is just about how fast it goes up and how much it should be.

I thank the noble Lord, Lord Magan, for reminding us of the service of his own family, because that reminds us of the service of so many families and family members across this country. Again, we will come to a debate and discussion on the spending point, particularly around the 2027 spending review.

The noble Baroness, Lady Bennett, made a point about soft power—that is a terrible name for it in many ways, but it is crucial to delivery. I will just make this point about soft power and defence diplomacy: everywhere I go across the world, irrespective of the view of the UK, countries are queuing up for the UK to stand with them. They do not necessarily want a warship, a tank or a fighter jet. They want the status, legitimacy and confidence of what a British military uniform gives to them when they make difficult decisions to deal with the challenges they face in their countries or regions, and I am proud of that. It has been hard earned by our service men and women. I think it is something we do not appreciate enough and should speak much more of, because they make a huge difference in huge numbers of countries across the world.

I have mentioned the point made by the noble Lord, Lord Mott, about the article that I may wish to look at. I agree with the noble Baroness, Lady Stuart, about the importance of the national conversation; the plan is developing. The noble Lord, Lord Altrincham, also made the point about the importance of a national conversation.

Let me say a few concluding remarks. I know that these debates are watched and read. I want to say clearly to Russia, to China or to anybody else who believes that this country is weak, and that we will not stand up for democracy, freedom and the values we cherish, that we will and we do. Do not misunderstand that in a democracy, people such as the noble Baroness, Lady Goldie, can challenge me and think I am wrong. They can think that the Government are wrong and challenge them to do more. That is not a sign of weakness; it is a sign of strength, and it is how a democracy works. That is what we have struggled and fought for through many decades and centuries. So if anybody is watching this, let them not mistake an honest, open, frank exchange of views as anything other than all of us being proud of what our country stands for, and what we will continue to stand for.

National Shipbuilding Strategy

Lord Coaker Excerpts

Wednesday 15th July 2026 Lords Chamber

[Lord Beamish]

To ask His Majesty’s Government what progress they have made towards implementing the National Shipbuilding Strategy.

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords, the Government are working hard to deliver for the UK shipbuilding sector. Since 2024, 1,000 jobs have been saved at Harland & Wolff’s yards in England, Scotland and Northern Ireland, a £10 billion frigate deal was agreed with Norway—the largest of its kind in UK history—and millions have been invested in critical infrastructure, all delivered through close collaboration between government and industry. The National Shipbuilding Office plans to publish a new shipbuilding and maritime technology action plan this year, going beyond the national shipbuilding strategy to set out our bold vision for the sector and to maximise its high-growth potential.

[Lord Beamish (Lab)]

Sir John Parker produced his report on national shipbuilding policy in 2017. It was adapted by the then Government, reviewed in 2022 and adopted by the incoming Labour Government. The Minister’s own department has made some progress towards ensuring that there is a throughput of work in UK shipyards. What more can be done to ensure that departments such as the Department for Transport, which is currently looking at providing ships for Trinity House to be put abroad, and the Home Office, which is considering putting its Border Force cutters abroad, do not use only shipyards subsidised by the national Governments in those countries that farm out sub- contracted work to the Far East?

[Lord Coaker (Lab)]

As always, the points that my noble friend raises on these matters are incredibly important. He will know, from his vast experience and the work he does, that we must have cultural change to rebuild the British shipbuilding industry and re-establish the sovereign capability. He will know from the region he represented with distinction for many years in Parliament, and now as a Member of this House still living in that area, the importance of the north-east for shipbuilding. We must have a situation in which buying British is first choice and our shipyards are first preference for the building of our ships, including for our Navy. My noble friend also makes the point that we need other departments to consider that as fully as they can.

[Lord Rogan (UUP)]

My Lords, the Minister will be aware of the central role that Harland & Wolff is intended to play in delivering the national shipping strategy, supported by significant investment from Navantia UK, which will create many hundreds of new highly skilled, well-paid jobs in Belfast. What support if any can His Majesty’s Government provide to ensure that the Northern Ireland skills base is ready to supply enough properly qualified workers to fill these vital roles?

[Lord Coaker (Lab)]

The noble Lord will know as well as I do that if you went to Belfast a few years ago, as I did many times, you saw a derelict shipyard with nothing there. Now, you see investment going into Harland & Wolff and orders being placed there for the building of ships. It is a great credit to the people of Northern Ireland and the people of Belfast that this is happening. The Government are investing in shipbuilding.

On skills, which the noble Lord mentioned, he will know that Northern Ireland was given a growth deal, which can be used for skills. He will also know that just a couple of days ago, Queen’s University Belfast became part of the Defence Universities Alliance, which will also help with that. The blunt reality is that we need to invest money in our shipyards across the UK. We are doing that in Belfast, as well as other areas in the country.

[Lord Bruce of Bennachie (LD)]

My Lords, we have more ships tied up than at sea. That was witnessed by the lack of a ship in the Med at the start of this recent conflict and the delay in mobilising HMS “Dragon”. Where is the urgency in covering that gap? Also, with no replacement for our destroyers, how are we going to protect ourselves against the growing threat of ballistic missiles?

[Lord Coaker (Lab)]

One of the things we are doing was announced yesterday by my colleague from the other place in Faslane: £26 billion of investment over the next 10 years into naval bases across the whole UK, so that we can improve the availability of our ships. We also need investment in our shipyards, which is taking place. That is one of the ways we are seeking to do this. We will improve availability, but it will take some time. On the Type 45 destroyers and their replacement, we are looking to the Navy of the future, which will have air defence and ways of dealing with the threats we face—but in a different way from simply replacing our existing warships.

[The Earl of Minto (Con)]

My Lords, Sir John Parker’s core message was absolutely clear: the British shipyards need a steady drum beat of orders, and the MoD must give a direction of travel. Shipbuilding now faces a yawning uncertainty, exacerbated by the defence investment plan. As has been mentioned, the Type 83 destroyers and the Type 32 frigates have been cancelled, leaving us susceptible to ballistic missile attack, and the Type 26 frigates currently under construction in Glasgow are being delayed. Now, all we have for the future is this vague concept of a common combat vessel, as yet undesigned, with no timelines at all. Why have the Government rejected the core proposition of the national shipbuilding strategy?

[Lord Coaker (Lab)]

We have not rejected the core conclusions of that report. The noble Earl is absolutely right that we need investment, and the Government have announced huge amounts of it. I cannot read them all out, but on pages 35 and 36 he will see sums of money, labelled against numerous types of ship, that will be invested in the shipyards. He is quite right that we need a steady drum beat of orders. As a proud Scotsman—with his Scottish noble friend, the noble Baroness, Lady Goldie, sitting behind him—he will no doubt be as pleased as I am that 13 ships are to be built on the Clyde over the next few years. He will also know that only yesterday we announced with the Netherlands eight amphibious transport ships, all to be built in the UK. It is not a bad start.

[Lord West of Spithead (Lab)]

My Lords, for too long we have had feast and famine within our warship shipbuilding industry. Part of the reason for the dreadful situation we are in today is that orders took too long to make and there was no drum beat. We will very shortly have four frigates—the great Royal Navy will have four frigates. It is almost unbelievable to say it. That is because we have not had a drum beat. Even now, looking to the future, with the 26s and the 31s, the Government have to commit to saying that they will build and drum-beat thereafter.

If you want 25 hulls, we all know that with a 25-year life you need one ship being built every year. If you want 30, which the Government have said they want, you need 1.3 being built every year. That is not happening, and we will not be getting the first of the new ships for another three years. It is extremely worrying. We must commit to a steady drum beat of orders that lets industry spend money, builds up the shipyards and gets the SMEs going. Then we can get back to having a Navy that can really do what it needs to do.

[Lord Coaker (Lab)]

I agree with the points that my noble friend makes. As I said in answer to the noble Earl, Lord Minto, that is what we are doing. We are steadily improving the drum beat that my noble friend talks about. We also need to ensure that we have the Navy that we need in the future. It will be a different type of Navy. Of course we will need warships and platforms; that is the point about the common combat vessel. Of course we will need such vessels, but they will launch from them uncrewed vessels above, on the surface of and below the water. When they are integrated on the digital platforms that we will have, they will give us huge capability to defend ourselves, our allies and our partners across the world.

[Lord Kirkhope of Harrogate (Con)]

My Lords, I was born and brought up very close to the River Tyne, and my family did well from the shipping that went on there. As I grew up, the shipyards were closing. We do not have the capacity in this country that we used to, but we have engineers, maritime designers and electricians, all those who understand the designs that are necessary for maritime security. Does the Minister agree that even if we cannot physically build the ships, we have talents and abilities here that can be sold throughout the world to develop the maritime industry?

[Lord Coaker (Lab)]

I agree with the point about the brilliance of our engineers and technicians and our ability to build ships. It would be great to see them supporting shipyards around the world and the building of ships, but I think this House wants to see the re-establishment of our own sovereign capability and that of our own shipyards around the UK to build the ships that we need. That is what the Government are seeking to do, whether in the north-east, Scotland, Wales or England. Only yesterday I met a shipbuilder who is chief executive of a company that is starting to build ships on the Isle of Wight, OCEA. That is the sort of small or medium-sized business that we need to support alongside the big prime contractors. The intention of this Government is to re-establish the UK shipbuilding industry. I think that is an endeavour we can all get behind.

Defence Readiness Bill

Lord Coaker Excerpts

Thursday 9th July 2026 Lords Chamber

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

I certainly never resort to rhetoric, so the noble Baroness has my assurance on that. I thank my noble friend Lord Harris for introducing such an important debate, and everyone who has contributed to it. The MoD is developing this work, and I will say a bit more about that, but the overall responsibility across the whole of government is with the Cabinet Office. I know noble Lords understand that, but it is important to lay down again that the co-ordinating function is for the Cabinet Office. Notwithstanding that, the Ministry of Defence has a crucial role and will do what it can to accelerate the progress that many have mentioned.

I say to the noble Baroness, Lady Goldie, and other contributors to the debate that the defence readiness Bill will be introduced in this Parliament. I cannot go any further than that. I cannot remember who it was, but somebody said it would be introduced in the next Parliament. The Government’s intention is to introduce it in this Parliament, which is as far as I can go.

In terms of the scope of the Bill, which goes to the heart of the question and is the point of the debate introduced by my noble friend Lord Harris, what the defence readiness Bill should contain is under discussion, so there are talks going on about what the scope should be. Many of the other points that have been raised are the responsibility of other government departments. At the same time, other pieces of legislation which deal with some of this are being looked at. One example that has just come to mind for me is the Civil Contingencies Act, but there are all sorts of other pieces of legislation which are important as well.

I also draw noble Lords’ attention to the fact that NATO has seven resilience requirements and, as part of NATO, we and all the members accept them. They deal with many of the points that have been raised: continuity of government, energy supplies, dealing with uncontrolled movement of people, food and water resources, mass casualties, civil communications systems and civil transportation schemes. All of those deal with some of the infrastructure problems and challenges that the noble Lord, Lord Harlech, mentioned. They are part of a readiness programme which all member states in NATO will be looking at.

My noble friend Lord Harris and others mentioned the important point about the changing nature of warfare and the importance of understanding that war is about cyber, climate and information and all the things we have talked about. We need to address those as well in any plan that we bring forward.

The noble Baroness, Lady Neville-Jones, asked when the Bill would be introduced. I answered that. She asked me to define “the whole of society”. I think the noble Baroness, Lady Smith, did it quite well. We can tie ourselves in knots about what the whole of society means but we all know that what we are talking about is everybody’s responsibility. Every part of society has a part to play, whether it be business, industry, government agencies, voluntary organisations, the military, individuals or groups of people—the list goes on—the devolved Administrations, local authorities and local resilience forums. All those have to be involved in bringing a plan together and in any conversation. The challenge is how you do that in a constructive and co-ordinated way that is not fragmented. As I say, the whole of society—

[Baroness Neville-Jones (Con)]

I thank the Minister for making that clear. It is an ambitious aim—in my view, it should be.

[Lord Coaker (Lab)]

I thank the noble Baroness for that comment.

To answer the points from the noble Baroness, Lady Bennett, from the NATO resilience actions she can see many of the things that will need to be addressed and will be addressed as we go forward. Like, I suspect, many people in the Chamber, I disagree with her about growth. I have never seen growth and the environment as conflicting. You need good growth and alongside that you need to care for the environment, but you have to have growth in the economy and trying to bring about that growth is really important.

On the NATO seven resilience actions, to the point made by the noble Baroness, Lady Wheatcroft, the national conversation is absolutely fundamental. We accept that. If I was going to criticise myself, I think I mentioned to the noble Baroness that I have been moved from the national conversation; in the reorganisation it has gone to another person. I have taken on a couple of other functions within the Ministry of Defence and that has gone to somebody else. In a moment, I will come to something that I tried to do. I would not say it was “ploughing a furrow” but it was an attempt to get it moving.

I say seriously to the noble Baroness, Lady Wheatcroft, that of course the national conversation is really important and fundamental to it. We are not frightened of doing it; the discussion is about the right way of doing it. That is the conversation and that is difficult. What exactly is the message that you want to get across? You have to ensure that people can rise to the challenge without frightening them. A discussion and debate would take place, if we had it in here, about what that means and what that should be. But the noble Baroness is quite right about the need for a national conversation and for us to move more quickly.

The noble Lord, Lord Harlech, whose service as an active reservist I always try to note, will know that in the Armed Forces Bill, due to be in Committee in September, there are a number of measures about the reserves. One of them is to reduce the threshold at which you can recall reserves from “almost imminent war” to “war readiness”. It would be interesting for us to debate what war readiness means. Committee might be the time for the noble Lord to table an amendment—not to vote on, but to explore the Government’s thinking. We are trying to lower the threshold, and the noble Lord makes an important point about that. The wider point, which my noble friend Lord Harris referred to, is whether it should be not just for war but for some of the other things we have talked about. We can have that discussion. On that issue, he will know that additional sums of money are being made available; usually, it would be left up to the reserve commanders themselves to look at how that might be allocated.

I have answered many of the points that the noble Baroness, Lady Smith, raised. On national conversations, the lesson from Finland and some of the other Baltic countries is the way they have found to speak to their people without unduly worrying them while alerting them to the change. The big thing about what they do and their example to us—the noble Baroness, Lady Goldie, and others talked about this—is the importance of homeland defence. The military and conflict have always been seen as about war in the traditional sense. From a UK point of view, it is almost seen as going overseas or on to the continent of Europe, whereas we are now talking about a threat to the homeland. How we deal with that is an important challenge for us all. It takes the UK into territory that we have not been in for quite a significant period, particularly since we have not been occupied in that sense, depending on how far you go back—noble Lords understand the point I am making.

The noble Baroness, Lady Goldie, asked about the national conversation. She is quite right that it will be somebody else’s responsibility, but I have done work within the department which I hope will help move it forward. As she knows, there are drafts and drafts. We are alert in the department to the need for the MoD to move forward and talk with other government departments about what responsibilities they should have to deal with something so important. I have answered her point about the defence readiness Bill, though perhaps not with the certainty she would want. We have discussed the finance; I know she specifically asked about the defence readiness Bill, but she can be assured that we will make the case for how important it is to fund it properly.

I thank all noble Lords who participated in this debate, which is hugely important. There are all sorts of things going on across government and society to deal with this issue. It is an absolute priority for the Government and all noble Lords. We all want to accelerate the progress and process. I think the noble Baroness, Lady Wheatcroft, made the point that we should get on with it, and we would all agree with that. I thank my noble friend Lord Harris for introducing the debate. It has been a very important one.

Armed Forces Bill

Lord Coaker Excerpts

2nd reading
Monday 6th July 2026 Lords Chamber

Moved by

[Lord Coaker]

That the Bill be now read a second time.

Scottish legislative consent granted, Northern Ireland and Welsh legislative consent sought.

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords. I start by highlighting the interests I have declared: my son-in-law is an active reservist.

It is a great honour and pleasure to speak to the Armed Forces Bill, as I know it is for us all. We should be reminded that without the Armed Forces Bill, the current Armed Forces Act 2006—the legislation that provides a system of command, discipline and justice for His Majesty’s Armed Forces—could not continue in force beyond the end of this year.  

Since 1688 and the Bill of Rights, it is a constitutional requirement that Parliament, rather than the King or the Executive, has the authority to exert control over our Armed Forces. It is Parliament, through our common consent and the act of renewal, that ensures that there remains a legal basis for the continued existence of His Majesty’s Armed Forces. As such, the Bill is for the Armed Forces, although it goes beyond simply providing the legal framework for them to continue to exist as disciplined bodies. It is an opportunity to renew the nation’s contract with those who serve.

This substantial Bill does much for our current and former personnel, and the Armed Forces community as a whole, to provide better support, housing and protections for victims of crime, and to provide greater resilience for the nation by increasing the size and availability of the strategic reserves. It does this by delivering meaningful reform across four key pillars.

The Armed Forces covenant—the pledge between the nation and those who have served—will be strengthened by delivering on the manifesto commitment to place it fully into law. Establishing the defence housing service will allow us to properly manage, develop and improve the defence housing estate and make it fit for purpose for our Armed Forces personnel and their families. Providing the service courts and the service police with new powers to provide improved victim support and protections will bring it in line with the 10-year strategy to halve violence against women and girls. Reforms to boost the size and availability of the strategic reserve will reinforce the UK’s defence forces at a time of increasing global threats and uncertainty.

I shall say a little more about each of the four pillars. The Armed Forces covenant was introduced 15 years ago and has made a real difference to many in the Armed Forces community. At its heart is a promise between the nation and those who serve, those who have served, their families and the bereaved, recognising the unique demands and sacrifices of service life. It has already helped to reduce disadvantage for our Armed Forces community across the areas of housing, healthcare and education.

We recognise, however, that it must go further. Clause 2 therefore delivers on the Government’s manifesto commitment to place the Armed Forces covenant fully into law. It does this by broadening the covenant legal duty to 12 policy areas and, for the first time, the devolved Governments of Scotland, Wales and Northern Ireland, and UK government departments, will be subject to the duty. This means that, in addition to housing, healthcare and education, the covenant will also apply to areas including social care, childcare, employment, taxation, social security, criminal justice, immigration and citizenship, pensions, transport and Armed Forces compensation.

On defence housing, the Government have a moral duty to provide safe and decent homes to service personnel and their families. They have been previously let down by homes that are not fit for purpose, and we are determined to change that. Underinvestment in defence housing over decades led to record lows in satisfaction with defence homes. The 1996 sale of tens of thousands of defence homes to Annington led to taxpayers picking up the bill for maintenance and rent to the tune of £600,000 a day.

However, just six months after being elected, the Government transferred 36,000 defence homes back into public ownership, reversing a privatisation that the Public Accounts Committee described as “disastrous”. The next task is to bring homes up to a decent standard—a standard that our service personnel and their families deserve. The Government therefore commissioned an independent review and, in November last year, we published our defence housing strategy—our plan for the wholesale renewal of defence housing, backed by a £9 billion investment over the next decade.

Clause 3 delivers on one of the recommendations of the defence housing strategy: the creation of a new stand-alone public body—the defence housing service. This will serve as a single point of accountability for defence housing, staffed by experts and with forces families represented as part of its governance. As such, it will put the needs of the forces and their families first. With a clear strategy, unprecedented investment and a dedicated organisation in the defence housing service, we will deliver on this once-in-a-generation opportunity to provide the safe and decent homes our forces and their families deserve.

Through the Bill, we will also deliver important reforms to the service justice system, especially in the area of victim support and protections. Clauses 5 to 10 provide a comprehensive package of protection measures, with Clauses 11, 12, 26 and 27 providing improved support and assistance to victims of offending. I add that, while these measures will strengthen the service justice system, we recognise that not all unacceptable behaviours reach the threshold of a criminal offence. That is why the Ministry of Defence continues to develop policies that seek to address unacceptable behaviours.

Through the Raising our Standards programme, we are tackling unacceptable behaviour and driving lasting cultural change across defence, with better training, clearer reporting systems and greater trust in leadership. The new VAWG prevention taskforce has been deployed to Catterick and to the south-west to assess lived experiences, tackle root causes of unacceptable behaviour and roll out effective interventions. Immediate initiatives are already being deployed, such as the recruitment of additional sexual assault referral nurses, who will cover the south-west, and the rollout of an independent legacy advocacy pilot that will support victims of sexual offences to understand their rights and what to expect when navigating the service justice system.

These policies, together with the separate service complaints process, now overseen by the recently appointed Armed Forces Commissioner, will also help ensure that unacceptable behaviour is challenged and addressed appropriately. I say to the noble Baroness, Lady Goldie, as well as the noble Baronesses, Lady Smith and Lady Kramer, that this improvement in culture also includes the whistleblower review. We will be meeting in due course before the publication of that review, which is now ready, subject to the noble Baronesses’ comments.

I move on to the package of measures relating to the reserves. Clause 32 will enable regular personnel at warrant officer level or equivalent, and below, to seamlessly transfer into the Volunteer Reserve, and vice versa, without having to leave one force and rejoin the other. Clauses 33 to 37 amend the Reserve Forces Act 1996 in relation to call-out and recall liability, ensuring that it is fit for purpose. This will help ensure that defence has access to more people with the right skills and experience it needs at times of need. It will harmonise liability across the services, widen the pool from which we can draw resources, and allow us greater access to both our Volunteer Reserve and Strategic Reserve pool. It is good to see the noble Lord, Lord Lancaster—who heads up the reserves—in his place. I know how hard he has been working, as many other noble Lords have been, with respect to this.

Just to digress slightly, I know that many noble Lords across the Chamber are particularly concerned about resilience and homeland defence and all those sorts of things. I look forward to the debate in Committee on that aspect, as we move forward on how we make the best use of our reserves around all of that.

Clauses 33 to 37 will make it easier to mobilise personnel earlier ahead of the outbreak of any war and increase the maximum age—from 55 to 65—at which reserves can be recalled. I welcome that increase. There are many people who would be eligible for this who are 64 and they would be brilliant doctors, brilliant accountants, brilliant cyber analysts—brilliant in many ways that would be of interest. I am aware of some of the initial reporting when that announcement was made, but if you look at it in that light, you can see the significance of the contribution that many older reservists could make to the defence and security of our country. Looking at it from that perspective, one understands the importance of and the reasons for raising that age limit. I just wanted to reiterate that important point at the start of our discussions on the Bill. These measures align with the direction provided by the strategic defence review to allow for a whole-defence approach, to re-energise the relationship with the Strategic Reserve and, as I say, increase our readiness for war or potential conflicts.

Beyond these four main pillars, the Bill contains other important measures that cover such areas as protecting the defence estate from drone activities—again, something that I know has been of particular concern to many noble Lords—providing increased protections for military shipwrecks, and extending cross-border powers for the Ministry of Defence Police.

This Armed Forces Bill makes important and positive changes for the Armed Forces, their families and the wider defence community. I look forward to the detailed scrutiny the Bill will be given in Committee, and the challenge that there will be to some aspects of it, while noting the general support there was in the other place and that there is—as I know from conversations I have had—in this place. Such challenge and scrutiny can only improve the Armed Forces Bill and make it a Bill of which our Armed Forces and defence community can be proud—which is indeed what we all want. I beg to move.

--- Later in debate ---

[Lord Coaker (Lab)]

I thank the noble Baroness for winding up the debate and noble Members from across the House for their contributions. I am really pleased—as I think the Opposition Chief Whip heard me say—that everyone is in favour of the Bill. I would hate to be answering on a Bill that everyone opposed; I would be in serious trouble answering all their questions, challenges and gaps, so I start by saying that I am so pleased that everyone is in favour of the Bill. Somebody outside the Chamber used the term non-controversial, but I will not use that phrase as it was made outside the Chamber.

That said, noble Members from across the House have made some serious points about how a Bill that they support could be further improved. I accept that and the challenge for the Government to take it forward. As I said in my introductory remarks, we all want the Bill to succeed because we support its aims.

Let me deal with some points. We have had the debate about funding, and I appreciate that the noble Earl, Lord Minto, and the noble Baroness, Lady Goldie, will continue to make their various points about that. I will make the same points back, and that debate will continue.

However, a number of noble Lords, including the noble Earl, Lord Minto, raised defence housing. I do not often get irritated—and I am not irritated—but I find it slightly strange that a Government who have committed £9 billion of public money over 10 years to improve housing are being taken to task on it. That is all I will say: the Government’s policy is to improve defence housing with £9 billion over 10 years.

Somebody asked whether it applies to single-person housing. With the defence housing service, we are talking about family accommodation. A separate review is going on for single-person accommodation which will report in due course and then the Government will have to respond. That is a very clear answer on that.

The noble Earl, Lord Minto, and the noble Baroness, Lady Goldie, raised the DIO and its relationship with the defence housing service. I will read out this bit of my brief to make sure I get it completely right: “The responsibilities of the Defence Infrastructure Organisation will continue to be provided as part of the National Armaments Director Group within the MoD alongside the new defence housing service, which will assume responsibility for the provision of family housing and the development of surplus defence land in line with the objective set out in new Section 343E(1) inserted by Clause 3 of the Bill. The new defence housing service will continue to work closely with departmental teams, and this will be covered in the framework document between the department and the defence housing service in the usual way”. That seeks to clarify some of the points that the noble Earl, Lord Minto, made in his introductory remarks, and that the noble Baroness, Lady Goldie, and other Members made about the relationship between the DIO and the housing service.

On the ECHR and its application continuing, I think the noble Earl, Lord Minto, made the point that an amendment would seek to change the Government’s wording from “may” to “must”, but all Governments usually argue, and this Government will argue, that they often require flexibility in how they implement various laws. That is something that we would seek to continue.

I thank noble Lords for their interesting ideas about funding for the future. The noble Baroness, Lady Smith, also raised the issue of defence bonds. The Government are looking at different ways in which we can finance defence in the future and no doubt that discussion and debate will continue.

The noble Lord, Lord Wallace, talked about the national conversation. That may change. This is a “stop the press” announcement: responsibilities among the ministerial team may change and I may already have lost the national conversation—not because I have not started it yet, I hasten to add. The serious point is that that national conversation is a priority within the department; the ministerial responsibility for it may well change, but it will be taken forward. I think that is something that the noble Lord, Lord Wallace, will be particularly pleased about, as will we all.

The noble Lord mentioned cadets, which I will come to later, when I also respond to some of the moving remarks made by the noble Lord, Lord Bailey.

Clearly, the national conversation is extremely important, not least around how we support homeland defence. The noble Lord, Lord Wallace, and other noble Lords also made the point about how we ensure that we get and retain public support for the amount we spend on defence. That is crucial to the way forward.

I thank the noble and gallant Lord, Lord Craig, for his welcome of the extension of the covenant to national bodies and his general support for that. He and the noble Baroness, Lady Penn, raised visas. I cannot answer all the questions, but I will answer some of them. Again, the Government are committed to scrapping visa fees for non-UK veterans who have served our country for four or more years, and their dependants. The MoD has started work with the Home Office to deliver this manifesto commitment, and that commitment on visa fees remains. I know that the noble and gallant Lord, Lord Craig, raised that, as well as the issue with the ECHR, and he heard me address that.

[Lord Craig of Radley (CB)]

I hope that the intention to proceed with it will be coupled with a date when it will be done.

[Lord Coaker (Lab)]

That is always my intention—rather than to be just aspirational—to try to demand change of the system. The noble and gallant Lord will know from his experience and military service that even a senior rank or senior ministerial rank does not always mean things moving quite as quickly as one would hope. Certainly, this is not an aspiration but a desire to actually bring it about. We will work with other government departments to try to ensure that something happens on that as quickly as possible.

The right reverend Prelate the Bishop of Norwich raised various issues and welcomed the covenant. He heard what I had to say about single-person accommodation and the importance of a whole-society approach. A number of noble Lords mentioned service police and we will come back to some of those issues in Committee.

The noble Baroness, Lady Penn, heard me talk about some of the changes to visas. She mentioned the importance of paternity leave and raised that with me at another meeting outside the Chamber. Of course, we will look at that and see how we can take it forward. I think she mentioned an individual case as well; if she wants to write to me about that, because I do not know the case, I will look into it for her.

The right reverend Prelate the Bishop of Norwich made a really interesting point with respect to not just the Church of England but faith organisations as a whole. The moral dilemma there is between supporting the Armed Forces and appearing to support war versus being a peace-loving faith, which all faiths are. That is a moral dilemma, but sometimes you prevent war by preparing for it. That is the difficulty with respect to that.

The noble Baroness, Lady Lane-Fox, made the point about housing; she will have heard what I had to say about that. She made some other points about the need for transition support, learning and training, which were really important.

The noble Baroness, Lady Brinton, made a number of very important points, which were linked to points made by the noble Lord, Lord Thomas. I thought his was a brilliant legal contribution—I actually understood it, which is not always the case—in the way that he laid out some of the issues with respect to the cases that he referred to, as the noble Baroness, Lady Brinton, also pointed out. I do not want to say too much, because there are ongoing legal issues with respect to that, but there are certainly discussions taking place about how we take it forward.

Here is the legal advice I have had—and this is for the noble Baroness as well as the noble Lord. The Visiting Forces Act 1952 sets out the legal basis for how jurisdiction for criminal offences is decided between the UK civil authorities and a visiting forces service court martial. This is implemented in practice by the police, the Crown Prosecution Service and the UK courts as part of the criminal justice system. Following the deeply distressing recent case, officials are working across government to establish the full facts of how this process was enacted in this case.

If needs be, regarding some of the other things said by the noble Baroness, Lady Brinton, I will make sure that we come back in Committee with answers to the questions she raised, when I have had a full legal response to the things she asked. I thought they were really important, and I will bring them forward and share them—obviously, if I bring them up in Committee, people will see that.

I thank the noble Lord, Lord Lancaster, for the points he raised about the Strategic Reserve, and the point about data and the digitalisation of the system strikes me as one of those important things where it seems we ought to be able, sometimes, to just get on with them.

I take the point made by the noble Lord, Lord Magan, and we will continue the debate around resources. My only point of contention with him is that I really do not think we have “smashed” our special relationship with the United States. There are ups and downs, and sometimes it is difficult, but the UK-US relationship is of immense importance to our country and continues to be so.

I thank the noble Lord, Lord Dannatt, for the points he made. He will know that we are working hard to ensure that we do all we can to work properly with respect to historic wrecks. I will take the point about divers and come back to him in Committee about how the Bill impacts on that.

I thank my noble friend Lady Carberry for her remarks and the importance she gave to the reserves, not underplaying the role of the Active Reserve, and of employers being on side. I completely agree with that, and we will continue to take that forward.

The noble Baroness, Lady Bennett, also made the point about paternity leave, and she will have heard what I said to the noble Baroness, Lady Penn. The noble Baroness and I will continue to have the debate about 16 and 17 year-olds, the young adults—they are not child soldiers. I see it as a really important part of the contribution that the Armed Forces can make to the development of some of our young people, but that is a debate that we will continue to have. I do not know what the maritime war graves committee is looking at, but I will come back to her on that in Committee.

I thank the noble Baroness, Lady Fraser. We may not have delivered exactly what she wants with respect to the covenant but, if she looks at Clause 31, she will see that we have moved on the commissioner having responsibility for RFA personnel. She will know, given the continued remarks that she has made over a number of years around the importance of the RFA, that, although not giving her what she wants with respect to the covenant, the Government have moved on the extension of the role of the commissioner to that, which shows that contributions from all sides of the Chamber can actually make a difference to government policy.

I have said what I have said to the noble Lord, Lord Thomas. The noble Lord, Lord Morse, made the point about housing which, again, is really important.

My noble friend Lady Dacres made a good contribution. The consistency of delivery around the covenant across the country is really important, and she is quite right to make that point. I would say that one of the successes of the introduction of the covenant has been that it has changed attitudes and culture, which often does not require legislation. I think that the Armed Forces covenant has forced local authorities—and will soon do so for national government, although it has probably changed national government behaviour by its very introduction—to change the way in which people operate and the way people interact with our Armed Forces and veterans. I think it has made a difference there, and I say to my noble friend that that is how we see it taking place across the country.

With respect to the noble Lord, Lord Hay, discussions continue on the Troubles Bill and Northern Ireland and the proper place for our veterans and respecting them.

The noble Lord, Lord Bailey, made a hugely moving speech about his own experience and the way in which cadets work. We all support cadets. There are significant sums of money going into cadets, and we wish to expand on that. The noble Lord made an important point about how we attract more volunteers to support that. He will know there are tens of thousands of cadets across the country. This is a point I often make: you see them at events such as Remembrance Sunday but also many others, including Armed Forces Day, which we had recently. The role of cadets in those events, nationwide, was a great tribute to their organisations and a symbol of the sort of society we want in the way in which cadets can bring people together. I thank the noble Lord again for the contribution he made, from his own personal experience, on the way that cadets can help people who may need help and also help those who are simply young people growing up. I think that that is important.

May I congratulate the noble Lord, Lord Stevens, on his work as a graduate of the Armed Forces Parliamentary Scheme?

[Lord Hay of Ballyore (DUP)]

My Lords, I thank the Minister for giving way. He will know Northern Ireland extremely well, and he will know that there are at least five councils of Northern Ireland that do not implement the covenant. What do you have when your veterans lose out? You end up with a two-tier system where, across the rest of the United Kingdom, the covenant is very much rolled out. There is an opportunity in the Bill to try to address that issue, so it is not the responsibility of a local government to implement the covenant.

This issue has been going on for some time. I could name the councils involved, but, when you have five councils out of 11, you are in a situation where you have almost half of Northern Ireland not implementing the covenant and veterans losing out, when the rest of the United Kingdom and the veterans benefit from the covenant. So I ask the Minister: is there a way, within the Bill, of addressing the issue around Northern Ireland and the covenant?

[Lord Coaker (Lab)]

The noble Lord explained some of that in his question. There is a particular situation, as he will know, with respect to Northern Ireland and the application of the covenant to all bodies there. As he will know, the duty applying to local authorities does not apply, and that becomes a problem, but we expect the covenant to apply to Northern Ireland through what the UK Government do. It is an ambiguity and it is difficult, but we will always seek to apply the covenant where we can, where it is appropriate, and where it fits the various devolution settlements with respect to that.

The covenant supports the Armed Forces community in Northern Ireland. Borough districts and city councils in Northern Ireland do not generally exercise functions in the policy areas in scope of the covenant legal duty. This does not exclude councils in Northern Ireland from pledging their support for the Armed Forces community by becoming a covenant signatory. I think that is what the noble Lord referred to. Some councils will choose to do so and others will not. That is the situation as it stands.

[Baroness Hoey (Non-Afl)]

The Minister must recognise that if this goes through without any recognition that Northern Ireland is again being treated differently, it really is not good enough. Surely, they are the Government of the United Kingdom of Great Britain and Northern Ireland, and the covenant is so important to all those people who have served in Northern Ireland and who live there.

[Lord Coaker (Lab)]

The noble Baroness will know from my record that the Government support the Armed Forces community in Northern Ireland completely. I went to Armed Forces Day in Northern Ireland last year, a government Minister went to Northern Ireland just a couple of weeks ago to support Armed Forces Day, and I have been asked to an event in Northern Ireland in a few weeks’ time, which I hope to go to.

Support for Northern Ireland’s Armed Forces community with respect to the aims of the covenant are clear. We seek to recognise the reality that is there. Councils can pledge themselves to the covenant if they wish. A number have done so, but some have chosen not to. I reiterate the Government’s support for the Armed Forces community in Northern Ireland.

I turn now to a couple of remarks the noble Lord, Lord Stevens, made. On the covenant, as I said, it is the bite of the “due regard” that makes a difference. We saw, when it was introduced by the last Government, that “due regard” has impact as it seeks to bite. Cultural change will cause the councils—as they were then; they are now national bodies—to start to do things that they would not otherwise have done.

It is good that drones are in the Bill. They start to plug a gap. There will be questions about how we deal with that.

I thank the noble Baronesses, Lady Smith and Lady Goldie, for their remarks. There are many questions that we will have to come back to.

I finish by saying that I welcome the general support for the Bill. I also welcome the various challenges and questions that have been posed. We will seek to address those and move forward in a constructive way. If there can be improvements and adaptations, and the Government agree with them, we will see whether we can find a way forward.

Bill read a second time.

Moved by

[Lord Coaker]

That the bill be committed to a Committee of the Whole House, and that it be an instruction to the Committee of the Whole House that they consider the bill in the following order: Clauses 1 to 3, Schedule 1, Clauses 4 and 5, Schedule 2, Clauses 6 and 7, Schedule 3, Clauses 8 to 31, Schedule 4, Clauses 32 to 36, Schedule 5, Clauses 37 and 38, Schedule 6, Clauses 39 to 46, Schedule 7, Clauses 47 to 56, Title.

Motion agreed.

Defence Investment Plan

Lord Coaker Excerpts

Wednesday 1st July 2026 Lords Chamber

[Lord Fox (LD)]

My Lords, this is clearly a very delayed and extremely underfunded plan. As we have heard, at £15 billion it falls well short of the £28 billion requested by the defence chief to keep our country secure. But we know that it actually falls even shorter than that, as nearly £5 billion is unfunded and some £11 billion or more relies on undetermined efficiency savings. So, after months of paralysis, resignations and Cabinet chaos, the Government have short-changed the Armed Forces.

However, we should remember that it was the Conservatives who hollowed out our military, leaving the Army and Navy smaller than they had been for hundreds of years. The Tories failed to look after service personnel properly, through a lack of suitable housing and poor mental health support—that was unforgivable.

This Statement is a long way from solving these vital issues and many others. It is a political choice made by Sir Keir Starmer and the Treasury, and it leaves us less safe. Furthermore, it undermines our reputation as a leader in NATO. Last year, all NATO countries pledged substantially to increase investment so that we all hit 3.5% of GDP by 2035. But, even if the missing money is found, the share of GDP that we spend on defence by the end of the decade will be only 2.7%. In media interviews today, the Procurement Minister, Luke Pollard, said that the spending review next year will describe a pathway to 3.5%. That review will need to find an extra £25 billion per year to get to our stated target. Given where we are starting from, this is hardly credible.

This lack of credibility is not just a domestic phenomenon. When I attend NATO Parliamentary Assembly meetings, I can sense the reputation of the UK falling back. This is more than just worrying. So I will suggest some ways to increase investment and leverage what resources we have more effectively. The Liberal Democrats’ plan for defence bonds would provide an additional £20 billion at least, funnelling in private sector investment. This is not pie in the sky. Poland’s armed forces support fund, for example, was established in 2022, with the main source of funds being issuing bonds. For context, last year Poland spent 4.7% of its GDP on defence.

There are better ways of leveraging our existing defence spend. The UK could take part in the nascent defence, security and resilience bank. This ticks a number of important boxes: it would be multilateral; it would work with a greater number of allies; it would help project financing to span election cycles; and it would cost-effectively pull in private finance, multiplying our state investment by many times. The Canadian Prime Minister, Mark Carney, is a major proponent of this initiative. He met with Sir Keir’s envoy, Gordon Brown, last month to discuss it but, disappointingly, there seems to have been no progress.

The Government could also take bolder steps towards working with our European allies. Last month, the Lib Dems announced a plan for a UK-EU defence pact, including our intention to join Security Action for Europe—the SAFE programme. Andy Burnham is quoted as having said favourable things about both defence bonds and the DSR bank. He has also been historically in favour of closer relations with the EU. Does the Minister agree that the new Burnham-led Government should issue defence bonds, work with Canada to deliver the DSR and join the SAFE initiative in Europe?

There are also ways of making our spend on big ticket items go a bit further. For example, GCAP currently involves the UK, Japan and Italy. Canada, Saudi and possibly Germany have been mooted as additional partners. Can the Minister confirm that, through adding to the GCAP group, money could be diverted to other UK defence needs?

Much has been made of the headline spend of £5 billion for advanced uncrewed systems over the rest of this Parliament. I am sure this is welcome, as these systems are at the heart of modern warfare. However, to put this into context, the three-year £5 billion investment is only a tiny percentage of the plan’s £298 billion spend over four years.

We welcome the commitment to establish six new energetics factories by 2030. However, the nine-month delay in publishing this spending plan has frozen procurement and put many SMEs in peril. Now that we have a funding plan, how will the Government change the procurement process to give SMEs the certainty to invest and the cash flow to thrive?

Finally, last year’s strategic defence review rightly stated that national resilience cannot be bought with military equipment alone. It stressed the need for a comprehensive national conversation to shift our mindset and prepare the wider British public, local government and business for the hybrid, cyber and non-traditional threats that we already face. This is a whole of society challenge that spans far beyond the MoD, so what concrete progress is the Minister making with his government colleagues to initiate this national conversation?

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

I thank the noble Lord, Lord Fox, and the noble Baroness, Lady Goldie, for their contributions and important questions.

I will start by dealing with the question of spending, which goes to the heart of what both noble Lords were saying. Let me put on record some of the things that were said about the defence investment plan. I will make only one political point—that there will be a 27% real-terms increase in defence spending between 2023-24 and 2029-30—because all of us have at heart the security and defence of our nation and how best we should do this.

As both noble Lords and the House will know, the Government have set out plans for an agreed £15 billion increase in spending. This is outside the normal spending review process. That is not necessarily the way that Governments normally do things, but I gently remind the noble Baroness that it is not unheard of for Governments to take action outside the new spending process and to refer to the next Budget as the place where the detail will be confirmed. Indeed, the previous Government announced their five-year NHS plan in 2018 outside the Budget and the spending review. What did they say when challenged about it? I think the noble Baroness and the noble Lord, Lord Fox, will know: “We will be able to explain exactly where every penny is coming from, but we will do it in the next Budget”.

I will also refer to when the Conservatives published the integrated defence review in 2020. What did they do? They said that they would set out the funding at the next spending review. So, let us drop the idea that this is an abnormal process. It is important that the Government have taken the decision outside the spending the review to reprioritise and reallocate spending between spending reviews.

We have said that we will lay out the process for the 3% in the next Parliament. We will come back to the 3% and, indeed, the 3.5% at the next spending review, which will be next year. That is not an abnormal process; that process of taking action outside the spending review is one that Governments have taken over the past few Parliaments. That is an important point to make. Indeed, the foreword by the Secretary of State refers to the commitment until 2035 as a “promise”. It is laid out in there. He and I would expect all of us to be held to account with respect to that.

The noble Baroness, Lady Goldie, and the noble Lord, Lord Fox, mentioned defence savings. I will be clear about the efficiencies, or the savings—whatever we want to call it. The allegation seems to be that the efficiencies are to be taken out of the spending power that the department would have. To be clear, the increase in our spending power is not conditional on these efficiency savings. That is a really important statement for us to make. Who would expect the Treasury, under any political party, not to require a department to have some sort of target for tackling fraud? Who would not see the use of increased efficiency through the use of AI or better technology as bringing about savings that could be reinvested? Who would not expect the Treasury to say, “We would wish you to find efficiencies through an increased reliance on consultancy”? Who would not expect efficiencies to be dealt with? Many noble Lords opposite have called on me in the past to find a way to make sure that we have the most efficient use of the workforce that we have.

The noble Lord, Lord Fox, asked me about housing. Over the next 10 years, the Government, having spent nearly £6 billion to bring Annington Homes back into public ownership, will spend nearly £9 billion over the next 10 years on improving military housing. That is hugely significant.

The noble Lord, Lord Fox, mentioned reputation. I often say that this country faces challenges, but the idea that this country is not respected in Europe or across the globe is not true. In fact, this country is hugely respected in Europe and across the globe. Do not take my word for it: read what the Secretary-General, Mark Rutte, said about the defence investment plan. He welcomed it; noble Lords can read that in today’s and yesterday’s papers.

With respect to the important contribution that we make to NATO—I do not want to risk the ire of the noble Baroness, Lady Bennett—I just remind everyone that one of the most important contributions that our country makes is through the nuclear deterrent. That is a huge contribution that we make to the security of NATO and of Europe, and to our defence.

On GCAP, of course there is always a need to look at new partners. A few weeks ago, the noble Lord, Lord Fox, and many other noble Lords questioned whether GCAP would actually be in the document. Now the accusation is that we are spending it too late—it is over £8 billion-worth of money—and that it is not being spent quickly enough. A huge amount of money has gone into GCAP. Of course the Government will negotiate on new partners, but that has to be agreed not only with us but with Italy and Japan. That is important for us as well.

There is a whole section on SMEs in the defence investment plan; it is not only on the big primes but on the SMEs. I say to the noble Baroness, Lady Goldie, that all the chiefs are content with the defence investment plan and have been involved in bringing it forward.

A number of noble Lords asked me about private finance initiatives and how we can bring that on board. I know that the Government are looking at the Defence, Security and Resilience Bank and whether that is a good way forward rather than necessarily defence bonds, which count as borrowing. No decisions have been taken about that, but we are of course looking at alternative ways of bringing that in. I say to the noble Lord that we tried very hard to get into SAFE, but we failed—we could not get into it. So it is not a question of trying to get into it; we tried and we will try again, but we were not successful. But in the meantime, the country will obviously continue to do what it can to build up its own defences.

The defence investment plan is a huge contribution to the defence of this country. It points to a way forward, it is transformative and it improves our readiness. For any investment plan brought before this House and indeed this country, that is quite an important statement of where we are.

[Baroness Stuart of Edgbaston (CB)]

My Lords, all European countries are struggling with coming to terms with new realities and what that requires for their defence and equipment to be appropriate to modern warfare. However, irrespective of the money and the percentages spent, if we do not start the national conversation—which we have been talking about for several months, if not years, now—the British public will not accept that they will have to accept cutbacks in other areas to defend our borders and our airspace, and, above all, the sea around us. Let us not forget that we are a nation, and our resilience and our capability to defend ourselves is not just about money; it is all about the support of the people. Can we start with that now?

[Lord Coaker (Lab)]

Indeed, we will come forward with proposals and plans with respect to a national conversation. The noble Baroness is right in her suggestion. We can see—many Members of this House will know this—that some of the ways in which the Government have asked different departments to contribute to this uplift in defence spending are already starting to cause some angst among certain communities. For example, in the east Midlands, where I live, the building of some roads is now being delayed, which is causing people to say, “Where’s the money going? What’s it being spent on?” Of course, having a national conversation is right, and the Government and all of us in here will have to make the case that defence is a priority, and that may require us to reallocate resources from one budget to another. We started that process, but as part of that process we must have the national conversation the noble Baroness refers to.

[Lord Howell of Guildford (Con)]

My Lords, I welcome part of this plan—it obviously has some holes in it, as we have already heard. I also welcome, as I do every time I hear the Minister speak, a great deal of his comments and his profound thinking. However, I wonder today whether the brief he has been given really tells the whole story. Not only have we heard about the deficiencies on the arithmetical and budget side but in the Second World War, for instance, our military spending rose to 69% of our total budget, and here we are, talking about 3% and 3.5%—it may be rather more than that when we look at the unfolding scene. I just wonder whether we should not be a bit more frank with the British people—or whether our briefing or the Government’s words should—in reminding them that we are beginning to move towards a total war footing. The late Lord Skidelsky often reminded this House that this is the way we are going, and we will have to seriously consider the sort of percentages that I am talking about. I am not sure that term comes through at all in the blue paper that we have all been given to read.

I am very pleased that we are reaffirming the huge global combat air co-operation between ourselves and Japan and Italy. This link with Japan and Japanese industry is hugely important. It is one of our ways into the giant consumer markets of Asia, which is where all the action is going to be. So good on that, but let us have a brief that honestly faces the fact that we are moving towards a war footing, and that that will cost far more than we are considering now.

[Lord Coaker (Lab)]

I thank the noble Lord for his question and his comments, which come from a great knowledge and experience, and I thank him for his remarks about me. Just to reiterate, the GCAP programme is extremely important, and as he just said, that is outlined in the money allocated within the paper. The debate is about how quickly we move towards increased spending, and I have outlined—without repeating myself—how the next spending review in 2027 will look to 3% but that the absolute commitment is to 3.5% to reflect the change in the security environment in which we are operating. In addition, I mentioned the nuclear deterrent, and across this House we have mentioned the importance of preparing for war, because one of the ways you deter war is to prepare for it.

[Baroness Foster of Aghadrumsee (Non-Afl)]

First, I welcome this Statement, which this House has been waiting on for some time, and share my concerns about the funding, which I hope will be sorted out under new leadership. However, I welcome the fact that there is an emphasis on innovation and supporting small businesses, and I hope to see that coming through. In terms of the detail of the plan, I note that there is £330 million to be spent on investment in critical underwater infrastructure protection to tackle hostile activity within UK waters. I have raised this issue with the Minister before. Can we expect the Republic of Ireland’s Government to pay towards helping with that undersea capability, because, as he knows, it is as important to the Republic of Ireland as it is to the UK?

[Lord Coaker (Lab)]

I cannot give the noble Baroness an assurance about what the Republic will pay for, but let me just say that there has been improved and increasing co-operation between the Republic and ourselves where it is in both our interests to do so. She will know that underwater cables and underwater infrastructure are important to the Republic and to the whole of the UK, so it is in both of our interests to work together. I cannot give her a commitment about paying for that, but I can give her the commitment that there is increasing co-operation and working together to deliver the shared objectives we would all have.

[Lord Teverson (LD)]

My Lords—

--- Later in debate ---

[Viscount Stansgate (Lab)]

My Lords, I welcome the publication of the defence investment plan and the recognition in it that science, technology and innovation are going to play a very big part in the future. Does my noble friend agree that it is not just a financial challenge that faces the defence investment plan; there is also a credibility challenge? We are going to have to explain to the public more effectively than perhaps we have been able to do so far exactly why we need a funding plan to reach 3% of GDP by 2030 and 3.5% by 2035.

[Lord Coaker (Lab)]

Indeed, as I said to the noble Baroness, of course we need a conversation to more fully and carefully explain to the public why we need to increase our expenditure on defence and security and, alongside that, to help them to understand why that might mean changed priorities for budgets within the sort of priorities that people would have. Whether that means less spending on this area or that area of government, I think we would all agree that the increase for defence and security is essential, and there will be difficult decisions ahead. As part of resolving that, we need to talk openly to the British people.

[Lord Teverson (LD)]

My Lords, one of the unfortunate realities is that the United States is moving away from the defence of Europe. Whether we like it or not, this is not just for this Administration; it is a danger that is likely to happen in future as well as the US looks to the Pacific. We understand that, and we understand that Europe should take more effect of its defence, but there are a number of capabilities that are not replaceable if the United States is not there—strategic airlift, a lot of the space intelligence, ISR and missile defence. I see nothing in this strategy or this expenditure report that tries to replace that. Clearly, one sovereign nation cannot do that, so how does Europe, together perhaps with Canada, ensure that we can defend ourselves into the future?

[Lord Coaker (Lab)]

There is a lot in the strategic defence review and the Defence Investment Plan about building up a greater sovereign capability in some of the areas that the noble Lord has addressed. But I think it is important in every debate to say that the alliance between the United States and our country and the alliance between the United States and Europe, notwithstanding the fact that the President has called for Europe to do more for itself, is absolutely essential to the defence and security of our country. The noble Lord may disagree, but I am telling him what the Government’s view is. The Government’s view—and, I am sure, the view of the vast majority of your Lordships’ House—regards the alliance between ourselves and the United States as absolutely essential for the security of this nation, so we have to be very careful about that. Of course there are challenges and difficulties, but the document refers to how we build up some of the capabilities to which the noble Lord refers. Of course Europe needs to do more, but it also needs to stand with the United States, not only in Europe but across the globe.

[Lord Craig of Radley (CB)]

My Lords, I share widely the view that this belated DIP comes nowhere near funding the strategic defence review, but the DIP does make clear the Government’s commitment, together with Japan and Italy, to the next-generation Global Combat Air Programme. This is welcome news, given the inevitable withdrawal of the RAF Typhoon air fleet from front-line service due to airframe fatigue and age in the early 2040s. Following the recent break-up between Germany and France on their similar programme, what political approach are the Government making to Germany to get them interested in GCAP?

[Lord Coaker (Lab)]

The noble and gallant Lord is right to point out the importance of GCAP and how it offers a sixth-generation option for us after 2040, when Typhoon is expected to go out of service. There is money in the defence investment plan for the upgrade of Typhoon to ensure that it has the capability that it needs until 2040. Regarding other partners in GCAP, as I said to the noble Lord, Lord Fox, we are open to discussions with anybody who comes to us with proposals or desires to join that programme, but that will be a matter for international negotiation between ourselves, Italy and Japan, although we are not opposed to looking at having further partners as part of that scheme.

[Lord Robathan (Con)]

My Lords, may I say that this is a disappointment, to put it mildly? I am on the same side as the Minister on this. This, I assume, was what led John Healey to resign—I suspect that it was the same document. Given that, does he think that any other Minister should resign, given the appalling lack of money in the Statement?

[Lord Coaker (Lab)]

There is an additional £1.5 billion, and there are also some changes with respect to the way in which there is a greater emphasis in this document on autonomy, AI and the transformation of the Armed Forces to have more new types of aircraft, vessels and capabilities. For me, that is as important as the amount of money, compared with not spending on new capabilities. But I would just say to the noble Lord that it requires difficult decisions to do that. On replacing the Type 45, we have scrapped the plans that we had in the document in favour of replacing them with new, uncrewed vessels. That requires us to make really big decisions, and there are a number of those sorts of decisions all through the document. Of course there is a debate about the amount of money, which is why I have talked about the 2027 spending review, but it is also about the type of capabilities that we need. The document shows that we are not afraid to make big decisions around that to give us the capabilities that we need in the future as well.

[Lord Liddle (Lab)]

My Lords, is it not clear that this is a welcome step forward, but that it cannot be the end of the story? We have to reaffirm our commitment to 3% by the end of this decade, and 3.5% by the middle of the next decade, as firm commitments of this Labour Government, and that in the period ahead we will carry out the kind of national conversation that was referred to earlier, and find a means of getting there. With due respect to noble Lords opposite, you cannot achieve this just by welfare cuts.

[Lord Coaker (Lab)]

In terms of the spending, I have made the point about the 2027 spending review, and that the document lays out that we will come back to the 3% commitment at the 2027 spending review, and, of course, the 3.5% commitment is laid out in the document as well. That lays out what the Government’s plans are.

[Baroness Bloomfield of Hinton Waldrist (Con)]

The noble Lord, Lord Liddle, has just alluded to the elephant in the room, which is that there are no cuts to the £333 billion welfare bill, which would go a long way to helping with additional support for the defence industry. My worry is that most of these cuts are unknown, and they are optimistic efficiencies, but I know that the £2 billion being cut from the BEIS budget is a worry. How is this going to affect Mr Miliband’s ambitions for net zero?

[Lord Coaker (Lab)]

I do not know about the ambitions for net zero. All I can say to the noble Baroness is that, of course, spending is important, and increasing the amount of spending on defence is important. Whatever decisions are made will require the reprioritisation of budgets for what the Government plan to do. That is the reality of finding more money for defence. We are ensuring that everything in the current plans, and the defence investment plan, is funded. The spending review will come back to how it is funded beyond 2029-30, and how that is done will be a matter for that review.

[Lord Kerr of Kinlochard (CB)]

My Lords, I was head of the Treasury’s defence division, and I welcome all this concentration on the money, but the document is actually about investment and where the money is to be spent. Ukraine is making, using, and losing 7 million drones a year. The life cycle of any particular model of drone is under three weeks, because they have to be continually reprogrammed because of countermeasures, so I rather like the emphasis in this document, in section 3.2, on industrial agility. I hope that the Minister can deliver on industrial agility, as it is crucial that the Ministry of Defence gets away from operational requirements that are negotiated for months and fixed for years, and accepts that there has to be an open partnership with business, and a two-way flow of intelligence and innovation. From now on, the weapon is the production facility, the drone is only the bullet and the only constant is change.

[Lord Coaker (Lab)]

I agree with that. In the document, it talks about the need for the transformation of our Armed Forces, and much of that will be around uncrewed capabilities and drones. It is not only about big primes; much of this, including in Ukraine as the example, is delivered by small and medium-sized businesses, which have that particular agility to which the noble Lord refers, and we need to develop that.

[Baroness Bennett of Manor Castle (GP)]

My Lords, with the honourable exception of the noble Lord, Lord Kerr, much of our debate today, as in the many months leading up to the defence investment plan, has focused on the bottom line and where the money is coming from; we have, unfortunately, had far less debate about how the money is being spent. I note that less than £10 billion over four years is set aside for homeland defence in areas such as cyber security, air and missile defence, and undersea infrastructure protection. By comparison, about £100 billion is being spent on nuclear submarines and jet fighters, AUKUS subs and cruise missiles. As the leading article in the Guardian said today, we are still binding our force structure to an American-led posture. Is that not deeply dangerous in the current geopolitical circumstances of an unstable, uncertain America?

[Lord Coaker (Lab)]

“No” is the answer to the noble Baroness’s question. Homeland defence runs all the way through the document: how we have better air defence, what we do about improving the use of reserves, and various protections for our critical national infrastructure, which is really important. As I have said before, on our alliance with the United States, the development and maintenance of things such as our nuclear deterrent are really important, not only for our defence and security but for the defence of Europe and beyond, and we should continually reiterate that.

[Lord Spellar (Lab)]

My Lords, I put it to the Minister that it would have been better to have had the conversation with the public before we put out the policy, so that we had rolled the pitch and people understood the nature of the threat. I welcome, therefore, what he is saying about the position going forward, but can we also make sure that the public understand the chronic neglect of our defence capacity that took place under previous Governments—notably the Annington housing and the neglect of maintenance—not least the failure to order nuclear submarines and the six-year delay between 2010 and 2016, which has left us in a very difficult position regarding our deterrent and our crew? Will the Government be making clear who the guilty men and women were?

[Lord Coaker (Lab)]

The catastrophic decision to pick out of what my noble friend said—given the importance that I, the Government and Members across this House attach to this—was the delay in 2010 for a number of years in renewing the nuclear deterrent. That was a really bad decision, and as a result our nuclear submarines are at sea for months and months. That is a problem we have to deal with, as is the fact that renewal of the deterrent, which is included in the defence investment plan, will be later than we would wish.

My noble friend talked about Annington Homes. It was a disastrous decision to privatise it, and we have brought it back in at a cost of £6 billion.

I know that a number of people who wanted to ask questions were unable to. We have the Armed Forces Bill on Monday, and if noble Lords and Baronesses wish to ask a question then on the defence investment plan, I am perfectly happy for them to do that, so that they do not feel that they have missed the opportunity to ask about something which is massively important to the defence and security of our nation and beyond.

Palantir: Public Service Contracts

Lord Coaker Excerpts

Monday 29th June 2026 Lords Chamber

[Baroness Chakrabarti]

To ask His Majesty’s Government what assessment they have made of the human rights and reputational risks presented by their public service contracts with Palantir.

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords, government departments operate within a robust procurement and assurance framework, ensuring that contracts are awarded only where requirements are met and no exclusion grounds apply. Palantir’s software is used globally across public and private sectors. Within the UK Government, its use is governed through established legal and assurance frameworks. In defence, Palantir supports data integration and AI-enabled analysis, providing timely insights that improve operational planning, decision-making and effectiveness.

[Baroness Chakrabarti (Lab)]

My Lords, I am perennially grateful to my noble friend. If we are to avoid a future Fujitsu-style scandal of even greater proportions, how can our public money, personal data, national security and reputation be safe in the hands of a company credibly implicated in gross human rights violations, both in Gaza and ICE operations in the United States?

[Lord Coaker (Lab)]

My noble friend is quite right to challenge the Government on these incredibly important issues around human rights and how the Government establish their contracts. To be clear about the UK Government, we are talking about a relationship and contracts that are negotiated with Palantir UK. The contracts that we operate with Palantir UK have strict protocols in place. We retain full ownership and sovereign authority over all defence data, including how it is stored, how it is accessed and how it is used. Contracts with suppliers include legally enforceable provisions to ensure that data sovereignty is maintained. I understand the points that my noble friend raises, but with respect to our contracts with Palantir UK, we ensure that the correct provisions are in place.

[Lord Austin of Dudley (Non-Afl)]

My Lords, given the Government’s decision to partner with Palantir as part of their defence modernisation programme and the role that advanced data and AI capabilities will play in future warfare, does the Minister agree that such technologies are critical to delivering the strategic defence review, strengthening the UK’s ability to respond to hostile state threats and supporting the Government’s wider objectives for growth, innovation and defence-industrial capacity?

--- Later in debate ---

[Lord Coaker (Lab)]

My noble friend makes a really important point. Many people across this Chamber will know that the responsibility of government requires difficult decisions to be made. As my noble friend Lady Chakrabarti has rightly raised, there are sometimes difficult decisions and difficult dilemmas to be resolved. Alongside that—my noble friend asked about defence—we have a responsibility to ensure that with the AI capability and the data management capability, we can take forward our strategic defence review and can give our Armed Forces and those who work with them the best possible tools to ensure that we deliver the objectives of His Majesty’s Government. That is what we seek to do, while recognising the moral responsibilities we also have.

[Lord Gove (Con)]

My Lords, I am grateful, as ever, to the Minister for his lucid and authoritative response. When I was a Minister, I saw how Palantir’s technology helped to save lives in the NHS. I saw how Palantir helped to ensure that those fleeing persecution from the Ukraine war could have a safe home in this country. I also appreciate that Palantir is playing a role in defending democracy, not just in the Middle East but in Ukraine. Is it therefore not a matter of regret to the Minister, as it is to me, that the Mayor of London has specifically ruled out Palantir helping to fight crime on the streets of London when the commissioner of the Metropolitan Police has made clear that, as a result of the Mayor of London’s decision, our citizens will be less safe?

[Lord Coaker (Lab)]

My understanding is that the mayor and the commissioner have now reached an arrangement with respect to the activity of Palantir within the Metropolitan Police, where there will be a 12-month period to establish a proof of concept as to whether Palantir can move forward. The mayor and the Metropolitan Police commissioner have agreed that because, as the noble Lord says, the commissioner believes it will help fight crime. It is a matter for them to resolve that, but it seems they have found a way in which both are happy to try to take it forward.

I do not want to underestimate the moral questions that Governments sometimes have to answer. The noble Lord knows the issue of education particularly well, but let us look at the issue with respect to health: 41 ICBs and 171 trusts have signed up to use the NHS federated data platform; more than 100,000 extra patients have been seen; hundreds of thousands of patients have been safely removed from the waiting list; and nearly 94,000 patients have been supported on their cancer journey. That is the sort of dilemma that Governments need to resolve to try to find the best way forward.

[Baroness Smith of Newnham (LD)]

My Lords, on these Benches we understand the importance of the Armed Forces modernising, including with AI. My understanding is that Palantir received a £240 million contract without the MoD going out to tender. While there are clearly national security exemptions for genuinely exceptional cases, is the Minister concerned that this could just move towards being a way of avoiding competition rather than helping national security? Will the next contract go out to procurement?

--- Later in debate ---

[Lord Coaker (Lab)]

The noble Baroness is quite wise to raise that point; it is a question I asked too. Officials told me that it was the only company—the only available platform—that could provide what the MoD needed and give us the operational capability that was required. Under the single tender regime—I cannot remember the exact title—where there is no other option available, it is okay and legal for the Government to operate in that way. That is why the Government did that. Of course we are looking at whether other people can provide the sort of expertise that the noble Baroness refers to, but there was no point going out to procurement when the only provider was Palantir.

[Baroness Goldie (Con)]

My Lords, by common assent, Palantir’s technology has rapidly and dramatically improved the Ministry of Defence’s logistics and operational planning systems without either human rights or reputational risks. Given that the current challenge confronting the MoD is recognised in the SDR, which recommended achieving a 10% efficiency saving by greater use of AI systems, what progress has been made on that objective to date?

[Lord Coaker (Lab)]

The noble Baroness will see in due course some of the ways in which we are taking forward AI, but she is quite right to ask about this. AI is crucial to the future provision for our Armed Forces and to enabling them to have the capability and capacity they need for the conflicts of the future. Palantir is one example of the way in which we seek to take that forward. Other options will be brought forward as part of the defence investment plan. Clearly, AI is the future of much of the technological co-operation that will be needed both within government and with our allies.

[Lord Spellar (Lab)]

My Lords, the Minister is quite right to resist attempts, which happen quite regularly, to demonise individual companies rather than looking at the underlying reality. He is also right to look at results. In this very fast-changing world of information technology, the company leading this year may well not be leading next year or even in six months. I recognise that Palantir has a major presence in the UK, which is welcome, but other companies are available. I caution against the department and the Government becoming overdependent on individual companies that almost become too big to fail, as we have seen in other sectors.

[Lord Coaker (Lab)]

My noble friend makes a really important point. Palantir provides us with the capability that we require at the moment, but he will be reassured by the fact that, alongside granting this contract to Palantir for the next three years from this April, we are seeking to look at options with small and medium-sized and other companies that could provide the same capability, so that we have a competitive process in future. That also answers the noble Baroness’s point. I suggest that will keep Palantir on its toes in the marketplace as well.

[Baroness Bennett of Manor Castle (GP)]

My Lords, have His Majesty’s Government considered applying a fit and proper person test to owners and managers for public sector IT contracts, particularly those involving Britons’ private data, with particular attention to their respect for human rights and the rule of law? If they do not have that, the contracts will not be worth the paper they are written on.

[Lord Coaker (Lab)]

I understand the point that the noble Baroness is making, but the point I made at the beginning is that these contracts are with Palantir UK. Anyone who has been a Minister knows that contracts signed on behalf of the Government have to have a fit and proper process. We will not take on people to run things for us who have criminal records of a particular sort, do not pass the monetary test or have other considerations around them that mean we see them as a security threat—of course we would not. The people who have gone through this process and been given the contracts have passed the tests set for them as part of the risk assurance process.

The noble Baroness is perfectly entitled to her opinion, but taking the decision not to grant Palantir the contract would have consequences as well—many patients now being seen would not be seen, many crimes being solved would not be solved and the operational abilities and capabilities of our Armed Forces would be undermined because no one else can provide that capability. That is the side that I am on. The noble Baroness can take the side that she is on.

Russian Shadow Fleet

Lord Coaker Excerpts

Tuesday 16th June 2026 Lords Chamber

[Lord Bruce of Bennachie (LD)]

My Lords, the boarding of the “Smyrtos” was conducted speedily, efficiently and without any casualties. It is a real credit to our Armed Forces. We all agree that it was a very impressive effort, and we should be grateful to them, but it is the first that has happened, as the noble Baroness has pointed out. My understanding is that the “Smyrtos” was operating under a Cameroonian flag, but Cameroon abruptly purged 36 shadow fleet vessels from its shipping registry last week. Can I ask where the other 35 are, and indeed who is pursuing them, and who is going to take any action to block them, deter them or prevent them from completing their journey towards Russia? What are we doing, either by ourselves or in co-ordination with others, to ensure that collectively we stop this shadow fleet? If you are talking about that number of ships, there is a huge amount of oil that is still being got through to Russia and that Russia is using to finance the Ukraine war.

On the oil that has been seized—which I think is 100,000 tonnes—what will happen to that? I assume that it will be sold on the market, but will those funds go to Ukraine to compensate it for the war? I hope the Government will consider that. Does this not also raise the case to lift the waiver on Russian fossil fuels now, rather than at the end of the year? Is it not quite ironic that we are launching military escapades to capture shadow ships while at the same time allowing oil to go to Russia legally? That is a huge contradiction, and a total lack of common sense. So I ask the Government: what are we doing to try to eliminate this shadow fleet—not by ourselves, but collectively with our allies? What are we doing to end the Russians’ waiver and apply the sanctions? Can we ensure that any oil seized is used for the benefit of the Ukraine war effort?

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

My Lords, I thank the noble Lord and the noble Baroness for the comments that they have made. I particularly thank the noble Baroness for her thanks—and I know it is a sentiment shared by us all—to our Armed Forces for the work that they did. It is important that we recognise that, as well as the military, specialist officers from the National Crime Agency were involved. I know that noble Lords will join me in thanking them for the work that they did as well.

I will share a factual update which may be of use to the House, before I come to the questions that have been posed by the noble Lord and the noble Baroness. One Indian national who was the captain of the ship has been arrested and is currently at Bournemouth police station. There were a further 24 Georgian and Indian crew on the vessel. The ship has been seized and is currently off Weymouth, and all those 24 members of the crew remain on the ship. The ship, having been seized, is now under the control of the Department for Transport. Many noble Lords will be aware of some of those facts, but they are worth repeating for the awareness of noble Lords, and there may be questions that will come from them.

I am not sure that I am going to do a lot better than my right honourable friend in the other place—I am not sure that the noble Baroness expects me to—but the situation is that the Prime Minister made the statement about acting when all the circumstances aligned, and when preparations were made. It was based on the briefing from the military and others that this was the right time to act, and it was a time when we could act. In the way that it was conducted, no shots were fired, and nobody was injured or hurt, but it was the right time to act, and that is why we did. That is the answer to the noble Baroness’s question; I am not sure that she will be totally satisfied, but that is the answer.

As far as I am aware, there has been no problem with respect to the law or being held back because of the law. The Government have always said we will act in accordance with the law, and there has been no barrier to action with respect to that. This operation was conducted totally in accordance with the law.

In answer to the noble Baroness’s question about whether this was a one-off, no, it was not a one-off. This was a purely UK personnel operation, and we will take action at any point, should it be appropriate. If the advice that we receive from our military and others is that it is appropriate, of course we will act.

The noble Baroness is right to say that the action was a deterrent. Some ships were immediately rerouted, with some veering off around the English Channel past Cornwall. It is my understanding, as she is right to point out, that other ships moved around the top of Scotland. We keep under consideration any other activity that we may wish to undertake.

I stress the importance of the noble Baroness’s point that we must show that we will act. It is important for others to hear that from this Chamber. We will act when all the circumstances are right, when all the legalities are in place, when the military capability is there and when the military advice that we receive says that it is appropriate to do so. None the less, the noble Baroness’s point about deterrence is really important, so I say again that this should not be seen as a one-off. The Government will act, with the support of everyone, where that action is appropriate.

More generally, on the noble Lord’s point, we have sanctioned 570 ships and we assess that some 200 of them have been restrained to port—in other words, they have become non-operational. I am aware of the actions to which the noble Lord referred, but sanctioning ships is also important.

In answer to the noble Lord’s question, of course we always work with others. We liaised with others on this operation, but it was led by the UK. He will know of other operations off our own coast, where we supported the Americans, and recently in the Mediterranean, where we supported the French. There is a lot of work going on, in which we act in the way that the noble Lord suggests.

We work hard to ensure that we do all we can to impact Russia economically. In this respect, it is oil, but there are other ways to ensure that we undermine Russia economically to have an impact on the war in Ukraine and to ensure the defence of our own country. What happens to the oil will be considered by the Department for Transport, which will no doubt have heard the noble Lord’s point on that.

The noble Baroness made a point at the end of her question about resources. I cannot add a lot to what I have already said on that, other than to repeat a point that I often make: the defence budget has gone up. From memory, it was approximately £60 billion in 2024-25, and it will be £73 billion in 2028-29. That is before we get the uplift from whatever happens with the DIP and, following the Prime Minister’s comments to the BBC, the spending review in 2027, when defence will be the number one priority.

We should be under no illusion about the actions that we have seen recently and the many others that we have seen in the Middle East and the north Atlantic, and the various other operations that take place. Notwithstanding the debate about resources and their adequacy or not, it is important to recognise, as I know your Lordships do, the significant amount of activity that our Armed Forces conduct on our behalf, in Europe and around the world. It is important to recognise that, notwithstanding the present challenges.

[Lord Cromwell (CB)]

While the Minister may have handed this off to the Department for Transport, can he comment on the likely fate of the crews of the ships that are being detained and on the future expectation of what will happen to the oil and to the ships themselves, many of which may be poorly maintained? I have a vision of our anchorages becoming full of these oil-filled rust buckets, which pose a real risk to our maritime environment. Anyone who remembers what happened with the Armada will know what happened to the ships that tried to go around the north of Scotland and down the coast. That poses a substantial environmental risk to us, should one of them come to grief. Could the Minister comment on that?

[Lord Coaker (Lab)]

I can comment on the environmental risk. Obviously that is important, and we will do all we can to ensure that we do not see any adverse impact or consequence of what we have done in that respect. As I have said, apart from the captain, who is in custody with the police in Bournemouth, the 24 others remain on board. The only legal way that they could come on to the UK mainland would be if they were to be repatriated—in other words, if they were coming here to be sent back to their country of origin. That answers that specific point. As for the ship, then noble Lord will remember the “Bella 1”, which was interdicted a few months ago. It was just off the coast of Scotland for a time, but, as I understand it, it is now in the Caribbean, far away from our shores. That is, I hope, an example of how, while we deal with the specific consequence of the interdiction, we are mindful of the potential environmental consequence. We are also mindful of what we do with the crew, but we do not want any environmental damage from the ships. However, that should not alter the fact that we will take action where we need to do so.

[Lord Redwood (Con)]

To deter these ships, surely it is important that the Government tell them what would happen to their cargo and what would happen to their vessel if they persist.

[Lord Coaker (Lab)]

The noble Lord is right to raise that. Let us be clear that the Department for Transport will ensure that the way in which the oil is dealt with in no way benefits the Russian war effort. That is a matter for the Department for Transport. One of the important things is to make sure that we as a country stand up for the law. The noble Lord will appreciate that the really important point is for Russia to understand that we will not stand idly by, whether that means sanctioning ships or taking action where we need to.

[Lord Hamilton of Epsom (Con)]

The Minister has stated that the reason why this ship was stopped and many others were let through was that the circumstances aligned. Does he mean to say that, when all the other ships went through our territorial waters, for none of them did the circumstances align?

[Lord Coaker (Lab)]

Without going into the criteria, which would benefit only those who seek to circumvent the work we are trying to do, all I can say to the noble Lord—he will know this from his own experience—is that I receive advice from people who are much more qualified than I am to say what is and is not an appropriate way to act in the circumstances. We had advice from a wide range of people that this was an appropriate sanctioned vessel for which we could take action, at minimum risk to our own personnel, ensuring that we could be effective in what we did.

[Lord Robertson of Port Ellen (Lab)]

I join my noble friend in commending those who were responsible for this remarkable operation and the success that it represents. I also commend the Prime Minister, who today announced further sanctions on Russia, tightening further the screws on Vladimir Putin and his regime. Can we be assured that the Government will continue now to look at any of the loopholes that may be being used by people to provide money that allows Vladimir Putin to continue this dreadful war against Ukraine and the Ukrainian people?

[Lord Coaker (Lab)]

I thank my noble friend for his question. He is right to point out that this is an important action by the Government, but it has to be seen alongside all the various other actions that were taken, which I know are supported by all noble Lords in this House. I agree with him about looking at any loopholes that might exist, as well as at what further sanctions we might take. The Government and the Prime Minister are keen to do that. It is important to say that, notwithstanding what is happening in the Middle East and in other parts of the world, our determination to continue to stand with Ukraine in defence of its territory against the illegal invasion by Putin—I know this is a sentiment shared by all—remains absolute. That is a really important point.

Let me also just say this, because I think it is sometimes not forgotten but overlooked. Putin did not expect to be fighting a war in Ukraine in 2026 after his illegal invasion. His policy objective, and what he believed would happen, was that within three or four days he would have taken Kyiv and established a puppet regime there to act as a barrier between NATO and Russia. He has failed in that objective, and we will continue to do all we can to support the Ukrainians in their fight, which is a fight for our democracy and our freedom, as well as a fight within Ukraine for their democracy and their freedom.

[Lord Clarke of Nottingham (Con)]

The Minister has several times failed to give any clear answer to the question of what is going to be done with the oil and the ship. He dodges that and, for some peculiar reason, the Department for Transport is now considering these important matters. Do I take it that this very skilful military operation was carried out with nobody having any idea of what they were going to do with the ship and the oil once they seized it? If they do not know what to do with it, will they consider the very sensible suggestion that, as this whole military operation is for the benefit of Ukraine, they should be sold and the proceeds given to the Ukrainians?

[Lord Coaker (Lab)]

I am sorry to have been such a disappointment to the noble Lord, Lord Clarke. I cannot really do any better. It is the law and the way the country has operated for many decades, including when the noble Lord was a senior Minister. The Department for Transport retains responsibility for these actions, and it remains responsible for what happens to the oil and the ship.

I say to the noble Lord that the most important consideration, in deterring Russia and in taking action against Russia, is for them to understand that they cannot sail around the world with impunity and that we will take action against them where it is appropriate, where we can, to interdict these ships. Alongside that, we have sanctioned 550 vessels—that is alongside what other countries have done—and stopped Russia having more than 200 vessels available because they have been kept in port. I take the point the noble Lord is making, and no doubt the Department for Transport will hear that, but the action we have taken will have a deterrent effect on Russia, and that is what is important.

[Baroness Butler-Sloss (CB)]

When the Department for Transport decides what to do, will we be told?

[Lord Coaker (Lab)]

I shall make a solemn commitment to the noble and learned Baroness, who is one of the most esteemed Members of this House. It will no doubt be noted by many of those who support me in my ministerial role that I am making a solemn parliamentary commitment that I will ensure that the House is informed of what happens to the oil, the ship and the crew. There we go. I cannot do much better than that.

[Lord Howell of Guildford (Con)]

One of the problems is that we do not know where these hundreds of ghost ships are at any one time or where they are going. There is a need to identify that. We should have a better system of international port links, possibly working with the Commonwealth, to achieve that.

While I am on my feet, I add that, having heard the mention of Lord Howard of Effingham keeping the Armada to the windward side of Britain, with the result that the ships all got smashed up and their goats and ships are on the islands of Scotland to this day, we have in this House his descendant, my noble friend Lord Effingham. We should be very proud that our contribution shows that the descendants of these brave people who saved England again and again is memorised and enshrined in that fact.

[Lord Coaker (Lab)]

I have not got that in my briefing, but it is important to recognise the contribution that many have made through the ages, which is reflected in their families and their descendants today, and I take the noble Lord’s point. Alongside that, it is important that we look at how we more effectively work together across the international community to ensure that the sanctions regime is implemented much more effectively. As many people know, through history, economic sanctions and the denial of economic benefit to a country undermine its war effort, so we have taken action to do that. Can we do more working with our international allies? Of course we can.

[Lord Harris of Haringey (Lab)]

My Lords, it is reported on Sky News that the “Admiral Grigorovich”, a Russian warship, has fired a warning shot at a yacht in the English Channel. Should we regard this as being a sign of an escalation in the tensions between us and Russia?

[Lord Coaker (Lab)]

The noble Lord will not expect me to say too much on, as I understand it, an ongoing incident that clearly is potentially very serious, as I do not know the full facts of what has happened. I know it has been reported; I have just found out about it through a text on my phone, so I say to the noble Lord that he will realise why I do not really want to say much about it, given that I may, unfortunately, just add to the problem. It is certainly a developing story, as they say, and will need to be reflected on. As soon as I go back to the MoD, I will ask for a full briefing on what is actually going on.

[Lord Garnier (Con)]

My Lords, does the Minister know whether the Russian shadow fleet, in so far as it is coming in and out of northern Europe, is going into the Russian Baltic or to the Russian Arctic? If the Russian Baltic, the strait between Sweden and Denmark is a lot narrower than the Strait of Hormuz, so what are we doing to interdict the ingress and egress of Russian shadow oil tankers through that strait? That seems to be a much more practical way of dealing with things with our allies in NATO in Scandinavia and Germany. Equally, what are we doing to patrol the north Atlantic in the Arctic region to prevent ships coming in and out of, for example, Archangel?

[Lord Coaker (Lab)]

Clearly, we work with our international allies and colleagues, whether it be in Scandinavia or anywhere else in Europe, essentially to deal with the sort of issue that the noble and learned Lord has raised. However, he will know that the UK is sending its aircraft carrier, HMS “Prince of Wales”, up into the north Atlantic with allies and friends in order to assert the rule of law in and around the seas. I think that is an important statement of where the UK Government, with our friends and allies, are with respect to all of this as well. Clearly, we work with others to ensure that, wherever the shadow fleet operates, we do all we can to ensure that we take the necessary action to prevent it happening.

[Lord Walney (CB)]

My Lords, this high-level procedure obviously took place in UK national waters. Do the Government believe that there would be legal justification for taking similar action against a sanctioned vessel in international waters? If the Minister is not clear, might he write to me?

[Lord Coaker (Lab)]

My understanding from the briefing that I had is that the action took place in international waters, and then it was brought back into UK territorial waters. An important point to make, just as a statement, is that the English Channel, although called the English Channel, is an international waterway; it is perfectly legal for legal ships to operate and to travel—even for warships, frankly—to go through the English Channel, providing their intent is not malign. That is an important comment for us to make. Then, of course, we have the territorial waters of our own country and the territorial waters of others in Europe. But as a specific answer to my noble friend’s question, my understanding is that the interdiction took place outside our territorial waters and the ship was then brought back into our territorial waters.

[Baroness McIntosh of Pickering (Con)]

My Lords, I declare my interest as being half Danish. The Danes have been especially concerned about this, and not just because of the damage it is doing to the war effort against Ukraine. Obviously, they live a lot closer to Russia, as do other Scandinavian countries, and we have had the build-up of troops on the Russian side of the Finnish border. Is it not the case that it might be easier for a big country such as Britain to board these vessels than a small country such as Denmark? To what extent can we co-operate through JEF and other international efforts in this regard? It would cause a catastrophic environmental incident if one of these vessels were to beach on one of the Scandinavian coasts.

[Lord Coaker (Lab)]

The noble Baroness makes a very important point. On what we may or may not do, we work very closely with all our allies, of course, including Denmark, but the noble Baroness makes a broader point about the importance of JEF and its work. In JEF, both in the maritime sphere and on land, we work with others to co-operate. She will know that we have troops in Estonia. I have also mentioned in the House that, only a couple of months ago, I was in Finland as part of a NATO operation. We were talking about the border between Finland and Russia. When you get within 30 or 40 miles of the Russian border and talk to people who live there, as I am sure many noble Lords have done, you understand the very real threat that they face; you understand the prospect, and their fear, that what is happening with respect to Russia in other parts of Europe might happen to them.

[Lord Craig of Radley (CB)]

My Lords, I join others in commending the crew that carried out this operation. It appears, technically, to have been piracy on the high seas, but the Minister has made very clear to the House that it was legal. I wonder, therefore, whether the Minister could explain in a short way the difference between what appears to be piracy on the high seas and a legal operation.

[Lord Coaker (Lab)]

The legal basis is that the ship was falsely flagged. As such, it loses some of the protections that it would have were it to be properly and legally flagged according to the rules that operate in the maritime environment. Also, the Attorney-General made clear that it was legal under the United Nations Convention on the Law of the Sea. From both points of view—the United Nations law of the sea, under which the Attorney-General was satisfied, and the fact that the ship was falsely flagged—it loses some of the protections that it would otherwise have. That means it is not piracy. The ship does not avail itself of the protections it would have were it properly flagged.

[Lord Vaux of Harrowden (CB)]

My Lords, what assessment have the Government made of the role of Greece with the Russian shadow fleet? Many of these ships appear to have been previously Greek-owned, and we have the ship-to-ship transfers of oil that are taking place in the Aegean Sea. What discussions have we had with our European partners in that respect?

[Lord Coaker (Lab)]

We talk to all our European partners, including Greece, about how we ensure that the sanctions with respect to Russia are as effective as possible. We highlight all the time the importance of ensuring that the efforts of Ukraine to repel the illegal invasion are successful. That obviously requires the support that we give militarily but, as I have said in answer to many of the questions that noble Lords have posed, the ability to undermine the strength of the economy of Russia should not be underestimated. The shadow fleet is playing a role in trying to support the economy of Russia; the more we can do to undermine that, the better.

[Lord Tyrie (Non-Afl)]

The Minister has said on several occasions that we will continue these operations of interdiction where circumstances align and where it is appropriate. I struggle to think where it would be inappropriate but, as for where circumstances might align, is that a reference to available resources? If there were an increase in the defence budget, would these interdictions become easier to conduct?

[Lord Coaker (Lab)]

It is not a question of resources. Where a sanctioned vessel is identified as having a false flag—to answer the point made by the noble and gallant Lord, Lord Craig—it is about understanding what its registration is or is not. When that is done, we get the military advice that it is possible to do X, Y or Z. Other criteria are also taken into account, some of which I do not want to go into. All I will say to the noble Lord is that, where we can and should, and where all the various criteria come together, we will take the action necessary to deter that shadow fleet from operating. In answer again to the question put by the noble Baroness at the start—Is this a one-off?—no, it is not a one-off. We will take action where we can, as often as we can.

Defence Investment Plan

Lord Coaker Excerpts

Tuesday 16th June 2026 Lords Chamber

[Baroness Goldie (Con)]

My Lords, the Chief of the Defence Staff has today given the International Relations and Defence Committee of this House stark evidence of what funding is needed and why we need it to maintain our defence capability. Does the Minister agree that, whatever ends up being in the defence investment plan, there must be an emphasis on funding ongoing operational activity such as boarding sanctioned tankers, paying for drones, equipping our serving Armed Forces personnel with everything they need to maintain operational readiness, and ensuring that our reserves are trained and equipped to optimise military and national resilience support? Does he accept that these are priorities?

[The Minister of State, Ministry of Defence (Lord Coaker) (Lab)]

The priorities, and the moneys for the future, will be laid out in the defence investment plan. The noble Baroness is right to point out some of the important capabilities we have to protect our country and to work with our allies. She was right, for example, to point to the importance of the reserves—it is good to see the noble Lord, Lord Lancaster, here—and to the ability to maintain our operational requirements. This goes back to a question asked by the noble and gallant Lord, Lord Stirrup, who is not in his place. As the DIP goes on, an important thing that will have to be wrestled with is the relationship between RDEL and CDEL, which is crucial to the way we will operate in the future.

[Lord Bruce of Bennachie (LD)]

My Lords, the Government have committed to increase defence spending to 3% by 2030 and to 3.5% by 2035. But what is required, and is chaotically missing, is a clear timeline that would enable the MoD and the defence industry to budget, plan and procure. Even if the DIP is published, as promised, before the NATO summit, it will not end the uncertainty. Holding out unspecified prospects for future spending does not really cut it. So when will the Government make a clear medium-term to long-term decision and remove damaging uncertainty for our defence industry and for other departments, which fear cuts, in order to fund what they do not know is happening?

[Lord Coaker (Lab)]

Money for defence is already increasing, notwithstanding what happens in the DIP, which will further increase defence spending. In answer to various questions yesterday about defence spending going forward, I simply referred to what the Prime Minister told the BBC on Friday afternoon. The Prime Minister laid out that defence will be the number one priority in every spending review, including the next one, which, I remind the noble Lord and the House, will be in 2027. There is the additional commitment, which I made at NATO last year, to get to 3.5% by 2035. The commitment laid out by the Prime Minister to the BBC and Chris Mason was important.

[Lord Shamash (Lab)]

My Lords, I have £50 billion in my back pocket. In 11 years’ time, my noble friend the Minister and every Member of this House will be able to get to Birmingham 20 minutes faster. Some £102 billion is due to be spent on HS2 going forward. If we cancel this project now, it will cost us £33 billion. The net saving will be somewhere between £50 billion and £70 billion. I ask my noble friend the Minister to take this away and see whether he can persuade his colleagues in the Cabinet to chop HS2, which is utterly useless, is going nowhere and was a bonkers vanity project right from the beginning. I invite him to do so.

[Lord Coaker (Lab)]

That is the most difficult question I have had. The serious point, notwithstanding the debate around HS2, is the question of priorities within government. One of the issues that has caused some debate and discussion—I was asked a question about it—was that when the Government made the initial defence spending increase, it was funded by a reduction in the overseas development budget. Now, the debate and discussion are about how we can reprioritise within the existing government spending envelope and use money from other departments, particularly from capital, to spend in the defence investment plan. There is always debate and discussion about priorities within government, and, no doubt, that will continue.

[Lord Howell of Guildford (Con)]

My Lords, might not the Government find it a bit easier to deal with their problems explaining defence spending if they distinguished much more clearly between the overall defence of the nation—where the budget spreads across many departments and takes a variety of new forms that change all the time—and the MoD budget, which, just like general spending, is always in trouble? I see in today’s newspapers that more trouble is coming along.

[Lord Coaker (Lab)]

It is an interesting idea. Indeed, the strategic defence review of the noble Lord, Lord Robertson, pointed out the contribution that many departments, not just the MoD, will make to homeland defence and the protection of critical defence infrastructure. In terms of what happens to the budgets, there will clearly have to be more co-ordination and work between government departments if we are to ensure that homeland defence and the security of our nation is what we want it to be.

[The Lord Bishop of Norwich]

My Lords, I thank the Minister for the answers he has given so far. I want to ask a question about service personnel retention; I declare an interest as the father of a soldier. The defence investment plan primarily addresses equipment, procurement and investment in research. However, one of the greatest challenges we face with the Armed Forces is retention and the general health and well-being of service people. Currently, the outflow before the end of their agreed engagement or commission stands at around 6%. What more can the Minister and His Majesty’s Government do to retain and support our service community?

[Lord Coaker (Lab)]

We are taking a lot of action on recruitment and retention. To give a couple of examples in the short time I have, the announcement last week about the further increase to Armed Forces personnel pay was important, showing that the Government support and respect the work they do. There is also the work we are doing on military housing; that is an important statement as well. We are taking a variety of measures in a variety of ways to ensure the value that we all place upon our Armed Forces personnel.

[Lord Fox (LD)]

One way of achieving the objectives that my noble friend spoke about, to give some certainty, could be for the UK to join the defence, security and resilience bank. In answer to a Question I asked on 19 May, the noble Lord, Lord Livermore, said that the Government had “no current plans” to join that bank. However, the Canadian High Commissioner said late last week that Gordon Brown had talked to Mark Carney about the UK joining the bank and that talks were ongoing between it, the Treasury and the Ministry of Defence. Can the Minister clear up for your Lordships’ House whether we are or are not seeking to join that bank?

[Lord Coaker (Lab)]

I cannot say that we are seeking to join that bank, but within the MoD and across government there are considerations of what other mechanisms we might use to fund defence.

[Lord Dannatt (CB)]

What is the defence intelligence assessment of the Treasury’s inexplicable decision not to fully fund the strategic defence review of the noble Lord, Lord Robertson? If it is purely to force change on the Ministry of Defence and move from legacy systems to innovation, surely, that is a rather blunt instrument—or have I missed the point somewhere along the line?

[Lord Coaker (Lab)]

I thank the noble Lord for his question. The original assumption was that we would look towards 2035 as when we need to be ready. However, with the intelligence and the work being done, we are looking more towards 2030, and that is in addition to what we do now. Those are the parameters within which government is operating, and that is the work the DIP seeks to address.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, does my noble friend agree that it is not just about how much we spend but ensuring that it is spent effectively? What is being done within the MoD to ensure that procurement is improved? Perhaps he might consult our noble friend Lord Drayson, who was a very good Procurement Minister. Will he also explain why we have more civil servants in the MoD than we have soldiers, and more admirals than we have ships?

[Lord Coaker (Lab)]

We are trying to increase the number of ships, so hopefully in the end we will catch up. The personnel we have, we seek to employ gainfully. We have reformed and changed how procurement operates within the MoD. We have a new national armaments director running a National Armaments Directorate, which is seeking to reform and change how we procure so that we ensure that whatever money is spent is spent as effectively and efficiently as it can be.