Better Defence Acquisition

Gerald Howarth Excerpts

Monday 10th June 2013 Commons Chamber

[Mr Hammond]

I can of course give the hon. Gentleman that assurance. We are trying to do two things: to ensure that the £160 billion defence equipment and support programme is delivered effectively to our armed forces and that it is delivered efficiently and in a value-for-money way to the taxpayer. In the end, this allows us better, more reliably and more sustainably to support our armed forces while ensuring that this is done in an appropriate way during a period of public financial austerity.

[Sir Gerald Howarth (Aldershot) (Con)]

I was a fan of Mr Bernard Gray’s report in 2009 when I was shadow defence procurement Minister, but I was a bit nervous about his proposals for a GoCo, so I welcome my right hon. Friend’s caution; he has taken the right attitude. Will he set out the mechanism by which he hopes to be able to maintain the crucial industrial capabilities that this nation needs, because that is an extremely important part of his statement? Will he also set out how the new proposals might avoid the mistakes of the £800 million cost overrun on the disastrous Nimrod programme?

[Mr Hammond]

I am grateful to my hon. Friend. He knows me and he knows that I am a cautious person. This is a big and complicated project, and we are approaching it carefully. We are weighing up the options and taking the appropriate length of time to make the decisions, and I am confident that they will deliver the result that we require. He asks about our national sovereign capabilities. We have set out our approach to the defence industry in the White Paper “National Security Through Technology”. We have also set out today, in this White Paper, the proposed changes to single-source pricing regulation and how we expect to drive greater efficiency into the single-source part of the defence industry that delivers about half our requirements. Only by making those in that sector focus on reducing costs, which they currently have very little incentive to do, will we make them not only efficient providers to us but efficient and competitive players in the international defence export market. That is in the interests of the industry, the UK’s armed forces and UK plc.