Defence Reform Bill

Alison Seabeck Excerpts

Tuesday 29th April 2014 Commons Chamber

[Mr Dunne]

What I am guaranteeing is that a report will be presented to the House before the commencement of part 1 comes before the House in an affirmative resolution. It will be up to the Government of the day to decide at what point to publish that report and therefore what interval to leave between publication and moving an affirmative resolution in this House. What I am not guaranteeing is the duration of that interval.

These Lords amendments will make a good Bill better. They show that the Government have listened to the concerns raised during the Bill’s passage through both Houses. The changes to the Bill covered by the Lords amendments will ensure that Parliament has the information it needs on these important aspects of our defence. I therefore ask hon. Members to agree to Lords amendments 1 to 7 and to reject the Opposition amendment to Lords amendment 7.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

Labour Members associate themselves with the condolences offered to the family and friends of the five servicemen lost so very tragically while serving their country. Their loss is deeply felt, particularly by their colleagues and close friends here in this place, and we acknowledge that loss.

Let me start by discussing the proposals to part 2 of the Bill. The Minister has talked about Lords amendments 1 to 5 to clauses 33, 39 and 42, which deal with the single-source procurement contracts. Labour Members welcome the amendments in principle, because they take forward the recommendations of the Delegated Powers and Regulatory Reform Committee, and because they make sensible changes to simplify this legislation. It does indeed make sense to use one statutory instrument for all the regulations under part 2, as Lords amendment 1 achieves, along with the accompanying amendments—the technical changes that follow. Baroness Jolly in the other place explained the logic behind these amendments, which allow all the regulations under part 2 to be made in one statutory instrument; there is also provision for the maximum penalties to be made under the single- source contract regulations, rather than in separate regulations.

My colleague Lord Tunnicliffe, who did sterling work in the other place speaking on behalf of the Opposition, said he needed to see the proposal in writing before deciding whether there might be a problem. Having seen it in writing, Labour takes the view that these are largely technical amendments to which we have no objections. However, there are some concerns about the way in which impact assessments are being carried out by Departments on new regulations. The recent Regulatory Policy Committee report, published last month, on the improvement of the evidence base for regulation suggested some serious weaknesses in the way in which Departments were estimating the impact of new regulations. Indeed, only 75% of the first-time impact assessment submissions were fit for purpose, down from 81% in 2012. Will the Minister confirm that the proposed change has been given the green light and whether there are likely to be any problems for that Committee? Lords amendment 5 addresses two more recommendations of the DPRRC. As the Minister stated, it is purely technical and we have no problems with it at all. The Opposition support the work done by the DPRRC and on both sides of the House of Lords and we welcome that group of amendments.

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[Mr Dunne]

I am intrigued by the selective amnesia from which the hon. Lady appears to be suffering. Does she recall the passage of the Companies Bill under the previous Government, as no fewer than 250 amendments were proposed for consideration by the House in the final two minutes of debate?

[Alison Seabeck]

The Minister is quite right to make that point. It is deeply frustrating for Back Benchers and for the public to see legislation being rushed through Parliament. There are lessons that Members on both sides of the House can learn—

[Angus Robertson (Moray) (SNP)]

You are as bad as each other.

[Alison Seabeck]

We can learn the lessons without hectoring from colleagues from Scotland. Full and public debate, and full and open scrutiny, are a sign of strong government, and it is something that we should all try to achieve in the House.

My noble Friend Lord Rosser said:

“If a future Government adopt the same approach”

and seek to run Defence Procurement via a GoCo

“the report on the effectiveness of the new DE&S-plus-plus organisation will be crucial, as will be the objectivity of that future Government’s assessment of DE&S-plus-plus”—

as it was referred to in the House of Lords—

“and their case for believing that the GOCO option would be more successful.”—[Official Report, House of Lords, 2 April 2014; Vol. 753, c. 966.]

The report for which this amendment provides will ensure that we can have real oversight as to the effectiveness of the new-look DE&S. However, as I have said, it still falls a bit short of what we would like. We are being asked to allow a measure to proceed that has been fraught with difficulty, at considerable cost to the taxpayer. According to the Minister, in a written answer to me on 18 December 2013, in running the tendering process the Government had

“spent £7.4 million supporting the work on the GoCo option”—[Official Report, 18 December 2013; Vol. 572, c. 636W.]

However, according to a parliamentary answer on 11 February 2014 to a question from my hon. Friend the Member for North Durham (Mr Jones), the total for the concept and assessment phase was almost £29 million. What is the final total, and has the Minister assessed the costs of running a similar exercise if a future Government opted to go down the GoCo route?

The Opposition very much hope that the changes that have been made—sadly, many of them are still not in the public domain—will make a difference, bolstering those areas within DE& S that need additional expertise or which have been hollowed out by changes to the overall size of the civil service. As we are discussing this part of the Bill, will the Minister kindly explain why, as of yesterday evening, the corporate plan and framework document for DE&S were not in the Library or on the Ministry of Defence website? In a written answer to the hon. Member for Mid Worcestershire (Sir Peter Luff), a former Defence Minister, and to me on 7 April, an assurance was given that that would happen. Certainly, in discussing the need for openness and for the full and proper scrutiny of the proposed measures, as well as consideration of the Lords amendments, having sight of this document would be helpful.

It was noted in the other place that a future Government, having made up their mind that they wanted to go down the GoCo route, might be tempted to try to rush through the affirmative order. That was acknowledged by the Minister as a potential problem. Lord Rosser pointed out:

“I cannot help but recall that this Government, in declining to withdraw Part 1, argued that there might in future be a need to bring in the GOCO option with a minimum of delay—an odd argument, bearing in mind that the Government themselves had just had to delay their intentions on the GOCO option by at least two or three years, but nevertheless an indication of a Government’s thinking that they might seek to make the change as quickly as possible at the possible expense of proper scrutiny.”—[Official Report, House of Lords, 2 April 2014; Vol. 753, c. 966-67.]

That was enough to cause Opposition Members concern. Any decision that could have such a major impact on the safety and performance of our heroic servicemen and women must be subject to the necessary scrutiny, and Parliament should be allowed time to undertake that scrutiny. We also have at the back of our mind debates about conflicts of interest, intellectual property protection and so on, which will need, should a new proposal be introduced, to be addressed properly and transparently. A rushed scrutiny period would be unsatisfactory and it would not inspire public confidence.

In conclusion, I am concerned that simply expecting the DE&S-plus proposition to become match-fit as a public sector comparator for future market testing of the GoCo is hardly a vote of confidence in the hard-working staff of that organisation or, indeed, of those businesses that have been encouraged to tender to become strategic partners, which is why stronger scrutiny would help. The Minister mentioned significant concessions, but he also referred to an uncertain future. The measure, as it stands, could do with a little more certainty and scrutiny. Sadly, he has failed to persuade us that our amendment is unnecessary, so we will be pressing it to a vote.

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[Alison Seabeck]

The hon. Gentleman mentioned the concessions from the Treasury, but without the detail of the corporate plan, which is yet to be laid in the Library, we do not know exactly what those flexibilities are.

[Mr Brazier]

We do not have the detail, but we do know that there is now more flexibility on people and in other crucial areas, such as the annuality of budgets, which are extremely important for running an operation such as procurement.

I want to leave one thought on procurement. Some 25, 26 or 27 years ago, when working as a management consultant, I was privileged to take part in a study comparing the procurement methods of seven different countries. Our procurers in the then procurement executive—it has changed its name several times since—were at least as good as the average and arguably better. The majority of the problems in the system fell into one of two categories. Either the customer within MOD changed its mind or was unclear about its needs, or things were laid down from outside, some of which appear to be being addressed. As a result of the unsuccessful attempt to create a GoCo, we have ended up with a better outcome than we would otherwise have had.

I support all the Government’s amendments and I am pleased that the hon. Member for Plymouth, Moor View is with them, too, although she has indicated one area in which she would like to go further.

I of course knew when my right hon. Friend the Secretary of State made his pledge on the reserves that it would be honoured. However, not only has it been honoured exactly, but the Government’s wording of the clause is better than I originally proposed and has been well thought through. They particularly thought through the complicated federal nature of the reserve forces and cadets associations. The clause deals neatly with a problem, which I hope will never occur again but happened some 15 or 16 years ago, when the centre got out of touch with its regional branches. Leaving the real power with the regional branches, which are elected, covers that issue nicely. Parliament will get a good report whatever happens. I am grateful to the Government for agreeing to the proposal and to the Members on both sides of the House who supported the original measure.

I end by saying—I hope that you will indulge in me in this, Madam Deputy Speaker, because, strictly, it is beyond the amendment—that when we originally debated the matter in the House, there was great concern about recruiting for the reserves. I expressed the view that it had been seriously mishandled under the new assimilated structure controlled by the Regular Army. I also expressed confidence in Major General Chris Tickell, who had taken over.

Since then, things have moved a long way. My local TA infantry battalion got as many soldiers in January and February as it did in the previous 10 months. That is still only two thirds of what it needs if it is to grow, rather than just tread water, but it is a huge step forward. Today it has eight young officers under the age of 30, whereas a couple of years ago it had only two or three.

I firmly believe that things will move in the right direction, but I think that the steady hand on the tiller of this annual report from the RFCAs, which really do get it, will play a profound role, and I am grateful to the Government for giving way on that. I support all the Lords amendments.

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[Mr Dunne]

It is not for me to determine what may happen in future in an area of the Department for which I am not responsible. My hon. Friend needs to recognise that the cost of training and bringing a new entrant into the Army Reserve is considerably higher than the cost of an already-trained regular transferring, where the cost is, in essence, negligible. The rationale for providing an additional bounty for the regular is that the cost is equivalent to what we are paying to train up a raw recruit into the reserves.

The hon. Member for Plymouth, Moor View asked where the corporate plan and the framework documents stand in relation to DE&S-plus. I am pleased to be able to inform her and the House that we will be placing those in the Library and publishing them shortly.

The hon. Lady asked about the costs of the exercise. I think she was trying to get me to predict the future cost of a subsequent GoCo exercise. I like to think of myself as a clairvoyant in some areas, but I cannot possibly determine what the rates of consultant advice might be at some indeterminate point in the future, so that was a question incapable of an answer. She asked specifically about the costs that we incurred on the previous exercise. I gently point out to her that the answer I gave on the cost of the GoCo element was a subset of the cost of the matériel strategy as a whole. That is why there is a difference between the £7.4 million figure and the £28.9 million figure that we gave to the hon. Member for North Durham (Mr Jones) in response to a question.

We have had a good debate this afternoon. It has been good natured—

[Alison Seabeck]

I thank the Minister, who has been helpful and charming throughout this whole process. I wonder whether he will indulge me in putting on record my thanks to the Officers of the House and to all the Members who have contributed to this debate. I am sure that he is about to do the same.

[Mr Dunne]

Thank you, Madam Deputy Speaker, for indulging so many Members of the House in an opportunity to use time that is rarely available to us to pass such niceties and congratulations across the Chamber. Yes, the hon. Lady’s remarks are absolutely reciprocated. We have had good support from the Officers of the House and from Members of the House throughout the Committee stage and all stages of the Bill. We have also had considerable support in the other place, where there was a great deal of interest not only from the former Chiefs of Staff who sit there but from many other Members on both sides of the House. I thank the hon. Lady for her contribution. I also thank the hon. Member for North Durham, who aided and abetted her throughout the Committee stage. I place on record my thanks to my colleague, Lord Astor of Hever, who took the Bill through the other place in his customary exemplary style.

This is an important Bill that will help transform the way in which we procure equipment for our armed forces and the way in which we use our reserves. I am pleased that it will now proceed to Royal Assent.

Lords amendment agreed to.

Lords amendments 2 to 6 agreed to.

Clause 49

Commencement

Amendment (a) proposed to Lords amendment 7.— (Alison Seabeck.)

Question put, That the amendment be made.