Military Aviation Industry

Graham P Jones Excerpts

Wednesday 15th September 2010 Commons Chamber

[Mark Menzies (Fylde) (Con)]

Thank you, Mr Deputy Speaker, for granting me the time and the opportunity to hold my first Adjournment debate. It may be my first Adjournment debate, but the topic is one on which I have spoken many times, both in the House and locally in the constituency. It is no less a subject than the future of UK military aircraft production.

The debate could not be more timely. Only last week, unfortunately, BAE Systems, which has its military headquarters in Warton in my constituency, announced potentially 1,000 job losses. I know that BAE Systems and the trade unions are working hard to minimise that eventual figure, but it serves as timely notice to us that the issue is not one of numbers or technology. It concerns people’s lives, jobs and the UK maintaining a sovereign capability in an area in which we are currently world leaders.

I refer to comments made by the Prime Minister and the Chancellor of the Exchequer shortly after the election, when they said that one of the most important things that we had to do as a nation was to rebalance the economy, and rebalancing the economy was about being less reliant on services and moving on to manufacturing. It was about jobs being in the north rather than in the south. It was about jobs with high export potential that earned serious money for this country. I can think of no other sector that ticks all those boxes more than the UK military aircraft division.

I know that you, Mr Evans, and your fellow Deputy Speaker, the hon. Member for Chorley (Mr Hoyle), are precluded from taking part in the debate by the office that you hold, but both of you have a long-standing record as doughty defenders of the UK military aircraft sector.

In the north-west the industry is the engine room of the entire regional economy. From Warton, Samlesbury and the other plants that we have, tens of thousands of component suppliers and many, many small shops and taxi firms gain a living from the work that is done there.

In this debate I shall focus on a few key areas—the future of the Typhoon programme, the exports that we can derive from that, and the unmanned aircraft programme, which, I am proud to say, is being developed at Warton. There are some Members in the House who say that we should not be concerned about having a UK military aircraft capability, that sovereign capability was for yesteryear, and that we should be buying off the shelf. What they seem to forget is that the UK is the shelf. We are world leaders in most of this technology. When it comes to unmanned aircraft, the work is not done in the United States. The Americans are not the world leaders, they are not at the cutting edge and they do not have the talented people. The work is done here in the United Kingdom—in the north-west, in Lancashire, in Warton and in Samlesbury. That is where the talent lies, and those are the people whom I am here to represent this evening.

I therefore call on the Minister, when he makes his remarks, to reflect on the importance of the future of the unmanned aircraft industry to this country, because it is not just an industry that we lead, but one of huge potential growth both in the realm of military technology and for civilian use. We live in an unstable world, and as part of the security and strategic defence review we have considered all sorts of threats. They include an increased risk of piracy, the need to defend key oil installations and tackling human trafficking. Unmanned aircraft in their various forms are a fantastic way of including flexibility in one’s military capability in order to address a number of those risks. Aircraft such as HERTI are flexible enough to allow civilian operators to take on some of those roles, leading to less reliance on Governments.

Typhoon, or the Eurofighter as some people may know it, is primarily built at Warton, but work has also been done at Samlesbury, and there has been talk recently about the importance of tranche 3B and why it is crucial for the RAF to place orders. I appreciate that when it comes to the lack of money in the defence budget, we are in unprecedented times, and I know that the Minister has to take some incredibly difficult decisions. Members will not like some of those decisions, but I believe that tranche 3B is very important and Typhoon is a first-class aircraft, so I make an appeal to him once again. When he looks at it, he should do everything that he can to ensure that there is the potential in the RAF for 3B.

However, we have to look beyond 3B, because the real prize is in Typhoon’s export potential, because that is where the jobs, the foreign currency and the futures of people in my constituency will lie. Many Members will be familiar with the export orders that have been placed with Saudi Arabia and BAE Systems’ work in that country and throughout the middle east, but I call upon the Government to continue that excellent work and gradually drive forward the work of BAE Systems and its work force in securing those export orders. I refer the Minister to the Prime Minister’s recent visit to India, where we secured a substantial order for Hawk jets, because I do not believe that BAE Systems, great though it is, could have achieved that without significant Government help at the highest level.

[Graham Jones (Hyndburn) (Lab)]

I thank the hon. Gentleman for securing this debate. Does he agree that UK defence contracts with BAE Systems also importantly enhance our export capability, and that any reduction in UK defence contract spending will affect our capacity to export?

[Mark Menzies]

The hon. Gentleman makes an interesting point. We cannot be totally reliant on exports, because, if the RAF buys and uses something, that is a more powerful pitch than any sales brochure, so we have to ensure that the UK armed forces continue to place significant orders for UK military aircraft. I agree that exports are not the only solution, but, in a tough economic climate, we need to invest a considerable amount of energy in securing such exports.

I say to the Minister, please let us not be shy about getting behind BAE Systems when securing exports. The French are not shy, the Americans wheel out Barack Obama and the Russians wheel out Vladimir Putin. So, let us leave no stone unturned and use every weapon in our armoury to ensure that the United Kingdom is out there putting forward what I passionately believe to be a world-class product built by a world-class work force, securing defence orders for this country and vast amounts of foreign currency potential. I call upon the Minister to support me in that.

We have 6,500 people working at Warton and about 5,000 at Samlesbury, but it is not just about numbers—it is about the quality of those jobs. Two hundred apprentices are currently going through BAE Systems military aircraft division.

--- Later in debate ---

[Mark Menzies]

I wholeheartedly endorse what my hon. Friend has said about the F-35. Indeed, we are very lucky this evening to be joined by members of the trade union movement from Samlesbury who are in the Public Gallery. Before I came into the Chamber, I was reminded of the importance of the F-35. Were I to forget to mention it, I would have very much failed in my duty to represent their wishes.

[Graham Jones]

One of the worries is that if the Eurofighter is withdrawn to a significant extent from Samlesbury, we run the risk of part of the development of the F-35 being withdrawn to the United States. There is always a risk, especially with high unemployment in the US, that the Americans will be looking to US manufacturing to take on what are essentially US jobs. The Eurofighter keeps that anchor in the UK and in Lancashire.

[Mark Menzies]

The hon. Gentleman raises an interesting concern. However, I am sure, from my conversations with BAE Systems, that the nature of the contract is robust enough, and the commitments from this Government are clear enough, that there will be a good future at Samlesbury. The Minister is bound by a difficulty in being able to give details about the F-35, but any that he can provide will be incredibly welcome.

I want to be generous in giving others time, because I know that colleagues wish to make some points. My final point is that the future of the UK military aircraft division, which is based at Warton but also has a significant element at Samlesbury, is not just about the regional economy of the north-west, or about jobs, vital though those matters are. It is about the UK being serious about ever again being able to play a role through a strategic, sovereign capability to manufacture our own aircraft, own our own technology, develop our own high-tech skills base and continue to be a world leader in what we do. It is also fundamental to achieving the objective of rebalancing the economy that the Prime Minister and the Chancellor of the Exchequer have set out. If we fail to take that into account and to get behind the UK military aircraft sector, not only will the north-west lose out but the entire UK economy will be much the poorer. I ask the Minister to get behind exports, do what he can for the future of the F-35 and the Typhoon, and let us really make a difference.

--- Later in debate ---

[Paul Maynard]

No, I am sorry. I am not prepared to give way.

As my hon. Friend the Member for Fylde said, a recent trip to India resulted in a much improved Hawk order. However, I would like to make one observation to the Minister that I hope he will bear in mind. There is no finer advertisement for the British military aviation industry than the Red Arrows. I hope that he will bear that in mind when he is considering the wider issues of the strategic defence review.

Tonight’s debate should not be about BAE Systems only. I realise it is a major player in the UK military aviation industry, but it is not the sole player. In the north-west, we have the North West Aerospace Alliance, which has made an enormous effort to develop a world-class supply chain that includes not just BAE Systems—

[Graham Jones]

Will the hon. Gentleman give way?

[Paul Maynard]

If I must.

[Graham Jones]

Put simply, if the RAF or the British Government will not buy Typhoons, why should any other country? It is a really poor advert. Does the hon. Gentleman accept that the strength of our exports will come from our confidence in our own products and UK manufacturing base? He seems to be arguing the opposite, which I do not fully understand. That is an important point that he needs to focus on—

[Madam Deputy Speaker]

Order. This is an Adjournment debate, which is going a little longer tonight because of the time. The debate is in the name of the hon. Member for Fylde (Mark Menzies). [Interruption.] Will the hon. Member for Blackpool North and Cleveleys (Paul Maynard) please resume his seat while I am on my feet? Thank you. Interventions are to be brief. It is a Back-Bench debate and should refer to the title and subject of the debate. If Members want to speak, they should stand and hope they get in.

--- Later in debate ---

[John Woodcock (Barrow and Furness) (Lab/Co-op)]

I had not originally intended to speak in this debate. I will try to make my contribution brief, but it is important to make a contribution, in part to correct some of the misconceptions spread by the previous speech and, to an extent, by previous interventions.

First, I agree with the hon. Member for Blackpool North and Cleveleys (Paul Maynard) on sovereign capability. It is important that we maintain that in the years ahead. The aviation industry in the north-west offers prime examples of the ways in which we have been able to lead the world, and it is vital that we continue to do so. I hope that the Minister will bear this in mind as we approach at breakneck speed the conclusions of the strategic defence and security review.

Hon. Members on both sides of the House should support the Government’s drive to improve the standing of our exports. We can sustain many jobs by increasing our exports, not only in the aviation industry in the north-west but right across the defence industry. We can also improve the UK’s standing in the world, and our military and diplomatic influences, by doing so. Let us not pretend, however, that the situation is dire at the moment, or that the previous Labour Government ran us into the ground. I am sure that the Minister is aware—although I am not sure whether the hon. Member for Blackpool North and Cleveleys is—that this country punches roughly three times above its natural weight in its exports industry. We should be proud of that, and the kind of partisan remarks that the hon. Member for Blackpool North and Cleveleys has just made do the defence industry and those who work in it a disservice.

I want the Typhoon to play an important part in the areas that I have just mentioned, and in sustaining the economy. It will do so, however, only if we take a mature attitude to exports and, as my hon. Friend the Member for Preston (Mark Hendrick) said, if we buy this kit ourselves. The first question that any foreign Government will ask when we rock up at their door and try to sell them this kit or anything else is, “Are you using it yourself?” If we are not, why on earth should they buy it? I very much hope that the laudable rhetoric that is coming from the Government at the moment will be sustained by a proper strategy that will enable us to acquire this kit and help us to export it overseas.

I want to mention scaremongering in regard to jobs. There is an important role for Members of Parliament in standing up for employment in their constituencies and their regions, and I think that many hon. Members on the other side of the House get that. I hope that the hon. Member for Blackpool North and Cleveleys understands it as well. It is not dishonourable to speak up for the potential industrial consequences of the decisions that are about to be made. I am a member of the cross-party Defence Committee, which has just concluded that some of those decisions could put at risk our long-term security, as well as our defence industry and the industrial base that it sustains.

[Graham Jones]

I note that, yesterday, the Minister said that the UK was the second most successful exporter of defence products in 2009, with orders worth more than £7 billion. Would my hon. Friend like to comment on that?

[John Woodcock]

My hon. Friend provides evidence for what I was saying earlier. We are a successful country, but we want to become even more successful. We shall need to do that in an environment that is going to be very tough in the years ahead. Other counties are retrenching their budgets just as we are, but it is important that we take a mature attitude to this.

Returning to my point about jobs and about the industrial base that the defence industry sustains, I wonder whether the Minister and the hon. Member for Blackpool North and Cleveleys are aware of the evidence that the chief executive of BAE Systems and other senior members of the defence industry gave to the Defence Committee last week. They pointed out that we are on the verge of decisions that we risk getting wrong. Alarm was expressed within the industry among the speakers who gave evidence to the Defence Committee last week. If we get this wrong, they said, we could lose our capability in the north-west—in aviation, shipbuilding and right across the piece—in a way that will have devastating consequences for employment. If in five or 10 years’ time, we decide that we need this capability, we will find that the employment base needed to sustain it has gone—never to return. If the hon. Member for Blackpool North and Cleveleys believes that those people were scaremongering when they said that, I hope he will stand up and make his view clear. I certainly do not think that they were, as this is a serious issue that will have to be dealt with.

In conclusion, it is so important to sustain capacity at Samlesbury and Warton—for the reasons I have just set out, but additionally because if the north-west takes the right decisions and the Government support it, and developing a defence and industrial policy following the strategic defence review will be critical—that could strengthen and augment its position as playing a leading part in the country and the world in producing world-class industrial products to serve our armed forces here and to export across the globe. The decisions made now and in the coming weeks and months will be critical.

--- Later in debate ---

[Graham Jones]

I question that last point. All the previous tranches, up to 3A, went through under a Labour Government, but tranche 3B, on which many Members are now focusing, is in doubt under the coalition Government. How can the hon. Gentleman justify his comment, given that all the previous contracts were honoured by the Labour Government, whereas the new Government are considering reviewing and perhaps cutting a future contract, 3B?

[Andrew Stephenson]

I am happy to justify my comment by asking how the hon. Gentleman justifies the Labour Government’s huge overspends, and the massive deficit that they built up when their expenditure was out of control. Clearly they should have got spending under control, and should have conducted a strategic defence review instead of delaying the pain until now.

The importance of big aerospace contractors such as Rolls-Royce and BAE Systems to Pendle, Lancashire and the United Kingdom economy should not be underestimated. As my hon. Friend the Member for Fylde pointed out, there is a significant number of subcontractors and support companies. The average job in aerospace contributes £75,000 gross value added to the economy, and the figure rises to £115,000 at BAE Systems, compared to only about £15,000 gross value added per job in other sectors in Lancashire. I have noticed when I have spoken to business men in my constituency how many of them started off as apprentices at either BAE Systems or Rolls-Royce.

Many Opposition Members have expressed concern about the potential impact of the strategic defence and security review on the military aviation industry. We have already had a debate today about who has been fuelling scare stories in the press. I believe that hon. Members have a responsibility not to fuel scare stories: I do not think that they do anything for workers’ morale. I suggest, however, that the biggest risk to our military aviation is not the strategic defence and security review, but the muddled and incoherent programme left by the last Government.

Before Opposition Members lecture the coalition Government on the financial implications of reviewing certain defence contracts, they should remember that with a defence budget of some £35 billion a year, they left behind an overspend in the equipment programme that will amount to £38 billion by 2020. That is what we must deal with now, and that is why we are carrying out a full review of all the current contracts.

I used my maiden speech to explain the need for us to build a high-skilled economy, and I specifically mentioned the importance of the aviation industry. So far I have been very encouraged by the measures that Ministers have taken to support military aviation, but I urge them to do even more to support that vital sector.

--- Later in debate ---

[Gordon Birtwistle (Burnley) (LD)]

I congratulate the hon. Member for Fylde (Mark Menzies) on managing to get this important issue on the agenda this evening. I have worked in the aerospace industry for more than 40 years, and I can remember working on the old Phantom engine at Lucas Aerospace many, many years ago. Amazingly, some of those engines are still being used in jet fighters in underdeveloped countries.

It is important to remember that this country can no longer afford to develop new military aerospace equipment, because it is far too expensive for a single country to do that. The European countries of Germany and Spain—the ones involved in the Eurofighter contracts—have appreciated that. One thing that concerns me a little is that although the Eurofighter is being built at the moment, we should be developing the next stage of military aircraft now. A new aircraft does not just happen tomorrow—it takes years and years to develop. I hope that the European Union, in collaboration with all the aerospace companies, is starting to consider the next combat plane that will have to be developed after Eurofighter finishes.

Eurofighter is being built at Samlesbury, near Preston, but the biggest contract for Preston would be one that has already been mentioned: the F-35. Our requirements for the F-35 are negligible compared with what the USA wants. I understand that it is considering somewhere in the region of 3,000 of these aeroplanes. Quite a large number of them will be built in Lancashire at Samlesbury and Warton. I hope that the Minister can press the USA to take final decisions on engine design and engine contracts, because I know that Rolls-Royce at Barnoldswick is urgently awaiting the contract.

[Graham Jones]

The hon. Gentleman makes some excellent points and I agree with him. I am concerned about our capacity at Warton if we are solely reliant on the F-35 and the Eurofighter is cancelled or reduced. The F-35 is assembled not in the UK but in the USA, so we will not need the runway at Warton and we will lose our capacity. There are ongoing issues when we rely totally on the F-35. We should not be doing that; we should be trying to keep our European bases, which is the point that he is making.

[Gordon Birtwistle]

All military aircraft go out of fashion. By the time the Eurofighter was developed, the countries that would potentially be our enemies were already developing systems to combat it. We have to accept that, as it has gone on for ever. I remember the TSR2—not many people in this Chamber will remember that—which got almost to the point of taking off when the then Labour Government cancelled it. This has nothing to do with politics, really—it has to do with collaboration between countries across the world in developing the fighters.

One thing that I want quickly to mention is the link between military aircraft and commercial aircraft. Modern aeroplanes, such as the Airbus, are built around the technology that has been developed over many years in military aircraft. The fly-by-wire in the Airbus was initially developed in the early stages of the English Electric Lightning aircraft and was developed further for commercial aircraft. Military aircraft sales in this country are very high—I accept that—but they pale into insignificance when they are linked to the sales of commercial airliners.

Rolls-Royce is one of the manufacturers, and much is built in Burnley—the thrust reversers are built at Aircelle. The contracts for the Trent engine and the Airbus wings all involve products that have been developed from old military technology.

--- Later in debate ---

[Graham Jones (Hyndburn) (Lab)]

The hon. Member for Burnley (Gordon Birtwistle) made a good point about cross-subsidy. We can look at BAE Systems and start from there. It spends £101,000 for every £1 million—10% of its revenue—on research and development, and it is the third-highest of 850 UK firms when it comes to R and D. He made the tremendous point that any reduction in our military or industrial base will affect commercial opportunities and other businesses in the north-west and the UK.

This is not a two-sided argument, as some Government Members have characterised it. It is not about deficit reduction or increased national debt, and I am very concerned that the Treasury is leading on this issue rather than the Ministry of Defence. The arguments between the Chancellor and the MOD do not serve the country or the aviation industry well, and statements such as that by the Secretary of State for Defence that we will buy “off the shelf” are very unhelpful.

The hon. Member for Blackpool North and Cleveleys (Paul Maynard) talked about scaremongering. When workers hear those kinds of comments and see job losses, they are naturally concerned. As my hon. Friend the Member for Barrow and Furness (John Woodcock) said, they have every right to approach their Member of Parliament and expect them to stand up on their behalf and for their jobs and families. They also have sense in that they understand that the sector is part of the UK’s industrial base, especially in Lancashire and the north-west.

I think we are all aware of the UK’s industrial base. I want to read out three points from the plethora that have been raised with me. First, the UK is the world leader in the manufacture of aircraft wings and engines, as the hon. Member for Burnley pointed out, and has a 35% market share in the sale of engines, which is worth more than £5.1 billion a year. Secondly, defence exports are generally worth £5 billion a year to the UK economy and support 65,000 jobs. Thirdly, according to the Government’s 2009 value added scoreboard, the aerospace and defence sector added £12 billion in value to the economy. The average value added per employee in the industry was very high, as the hon. Member for Pendle (Andrew Stephenson) pointed out, at £116,000, whereas for general manufacturing the figure is £15,500 per employee in Lancashire. The £116,000 figure also compares well with those for other industries. The sector is one of Britain’s success stories, as has been pointed out.

This is not about scaremongering. The hon. Gentleman is right that it is important that these issues are raised in this place and discussed thoroughly. The citizens who elect us are the important people, not us. We are simply advocates on their behalf. They are the ones who will face redundancy and repossession when they are unable to pay the mortgage. Britain will suffer from the economic impact—and there will be an economic impact. This is not a case of pushing one domino over and perhaps two or three others falling. In the case of the defence industry, if one domino is pushed over, it is likely that the whole lot will go down, and Britain’s industrial capacity in one of our best exporting sectors will then be torn away.

The north-west has a great export and manufacturing story. However, as the hon. Member for Burnley said, that has come on the back of military spending and Government contracts. The old private sector and state industries are long gone, and the heartbeat of the north-west economy is kept ticking by, if not the public service, defence and nuclear.

The Chancellor’s priorities for the coalition Government are a return to manufacturing, and a focus on the private sector and on manufacturing companies that are able to export to get Britain out of the so-called deficit. The north-west’s defence industry ticks all those boxes. We should look at the domino principle of how everything collapses if the industrial and skills bases are taken away. If things are turned off today, they will not come back on in five years’ time. Given that the industry ticks all the boxes that the coalition has put forward, I do not understand why it would cancel any of the defence contracts.

[Gordon Birtwistle]

Does the hon. Gentleman agree that the age profile of a lot of the work force in the British aerospace industry, particularly in Lancashire, and the engineering industry is getting very high and that when those members of staff move, the companies should seriously consider replacing them with a major influx of new apprentices? We heard earlier that BAE Systems takes on a derisory number of apprentices compared with the number of people whom it employs.

[Graham Jones]

The hon. Gentleman makes the good point that a lot of skilled people in the sector developed their skills in the 1960s and 1970s. We paid the price for the great manufacturing recession of the 1980s with the loss of capacity and skills. Those in my generation are missing from the skilled group, and such unskilled people should have become skilled so that they could work in places such as Warton and Samlesbury. The history lesson from the 1980s shows that when manufacturing is hit, it does not come back, and we should take that lesson on board when we consider defence spending.

The hon. Gentleman is right to talk about apprenticeships. BAE Systems has some 200 apprentices. It spends £1 million at the university of Central Lancashire and is heavily involved in trying to bring young people through so that they get skills. On job prospects, I have heard someone—it might have been my right hon. Friend the Member for Doncaster North (Edward Miliband)—talking about Govan shipyard or Asda, and one could almost say for us that it is a supermarket or BAE. That is not quite true, but it is a lot of people’s perception of job prospects. A job at British Aerospace, as it was formerly known, was something to behold because someone employed there was working for a first-class company that was one of the best in the region.

The Minister has heard a lot of evidence during the debate—all of it true—to show that we cannot afford to cancel defence contracts now.

[Ben Gummer (Ipswich) (Con)]

The hon. Gentleman is addressing the House in a positive manner and we are with him on maintaining jobs, skills and our excellent defence export industry. However, is he edging towards suggesting what his party would be able to cut to maintain the defence expenditure that he is proposing? Government Members would be fascinated to hear what might be sacrificed so that his skills base and industry may be supported.

[Graham Jones]

Thank you very much for raising that. You make a very good point that there has been no dialogue—

[Mr Speaker]

Order. May I gently say to the hon. Gentleman that I have not made any point at all? It is important that the second person is not used. We must get into the habit of holding debates through the Chair. I know that the hon. Gentleman will wish to continue that now—we look forward to it.

[Graham Jones]

I apologise, Mr. Speaker. It is a result of being a new MP.

There has been little dialogue between the Government and unions. We need more discussion of the future prospects. I appeal to the coalition to engage in more dialogue and to think about the decision that it will make.

--- Later in debate ---

[Peter Luff]

I hope the hon. Gentleman heard me express deep regret for those redundancies, which result from decisions taken in the past. Exactly how BAES chooses to distribute its skills and work force in future is a matter for BAES, and it is not for me to comment. However, I express deep regret to those individuals, many of whom are outstanding engineers and technicians who started as apprentices and who have given a lifetime of work to some excellent products. I shall turn to the importance of maintaining a skills-base in the north-west, in particular for unmanned aerial systems, in a moment.

Another unmanned aerial system, Taranis, is the MOD’s prototype unmanned combat aircraft of the future. Built by BAES, Taranis reflects the best of our nation’s advanced design and technology skills. It will allow the MOD to gain a better understanding of the most cost-effective and capable future combat air capability force mix between manned and unmanned platforms. A pinnacle of UK engineering and aeronautical design, Taranis is a leading programme on the global stage and a significant step forward in this country’s fast jet capability. It is truly a trailblazing project.

To return to a point I made earlier, projects such as Mantis and Taranis will enable the UK to retain vital aeronautical engineering and design skills, not least in the north-west at Warton and Samlesbury. However, we acknowledge the risk to sustainment of critical engineering skills and, in particular, a critical mass of design skills within the UK aerospace sector. We are currently funding some work with BAES and key UK suppliers to sustain capabilities pending SDSR outcomes, which I am afraid I cannot prejudge.

My hon. Friend the Member for Fylde of course has a specific in interest in Warton, and its work is vital to the Department. The Typhoon programme contracts are worth approximately £20 billon for, from memory, about 160 aircraft, up to and including tranche 3A. I was asked to say that I would not cancel tranche 3B, but I cannot cancel it, because no order has been placed. However, all future Typhoon contracts are SDSR dependent. Of course, a significant proportion of the Typhoon work goes to BAES.

The MOD has also awarded a contract worth approximately £145 million for unmanned air systems air projects based at Warton. As a number of hon. Members pointed out, the site makes a critical contribution to the multi-billion dollar JSF F-35 programme, about which many hon. Members spoke enthusiastically. I agree with my hon. Friends the Members for Burnley (Gordon Birtwistle) and for Pendle that a two-engine option is vastly preferable in terms of security, design and driving down cost. I hope our American friends will be persuaded to pursue the two-engine option, which offers great strategic and financial advantages to countries participating in the programme.

The UK’s military aerospace industry is well placed to continue performing significant work in maintaining Typhoon’s capability edge and to address the considerable export interest that is being shown. Indeed, with two existing export customers—Austria and Saudi Arabia—official campaigns being pursued in India, Japan, Turkey and other countries, and with further opportunities in the middle east, including in Oman and Qatar, Typhoon promises to provide excellent employment prospects. That underlines that healthy defence exports are the best way in which to sustain a viable defence and aerospace sector in the UK.

The hon. Member for Hyndburn (Graham Jones) suggested that we were in some sense withdrawing from a commitment to Typhoon, but nothing could be further from the truth. Such suggestions are very damaging to our defence exports. This country has a fine aircraft in Typhoon, which is already in active service and serving the country very well indeed. However, the Typhoon situation will require the industry to continue modernising its approach to address the capability and through-life support requirements of those customers, as it does in the UK, rather than simply focusing on aircraft production and supply. Through-life support costs are hugely important, and we look forward to showing the way ahead through the Green Paper that I mentioned. Certainly, we will work with industry to ensure that, in future, our requirements for new equipment are designed from their inception with exportability in mind. That is very important in, for example, the unmanned air systems environment.

My hon. Friend the Member for Fylde asked for reassurances on the JSF. Again, it must be SDSR dependent, as in everything else, but the UK’s contribution to the JSF development will not change—it is fixed by the memorandum of understanding that we signed jointly with the US in 2001. There are significant work share benefits for the UK aerospace sector and it is important to recognise that those benefits come because of the excellence of that sector, which has won those contracts in competition in world markets. That is a great tribute to British engineering and the sector itself.

The UK’s plans to purchase further joint strike fighters are incremental—we already have some bought for test purposes—and they have always been based on the programme reaching technical maturity levels and being affordable within the overall resources for defence. We will regard future purchasing plans accordingly, as part of the normal planning process and the outcome of the SDSR. The UK continues to play an important role in the JSF programme through the provision of expertise and resources, including RAF pilots who are now flying the short take-off and vertical landing—or STOVL—flight test aircraft.

The SDSR underpins all this work and, together with the new national security strategy, will provide a coherent and consultative approach to security and defence across government. Our National Security Council has agreed that the overarching strategic posture should be to address the most immediate threats to our national security while maintaining the ability to identify and deal with emerging ones before they become bigger threats to Britain. This flexible, adaptable posture will maintain the ability to safeguard international peace and security, to deter and contain those who threaten Britain and her interests and, where necessary, to intervene on multiple fronts. It will also, crucially, keep our options open for a future in which we can expect our highest priorities to change over time.

It is very clear that the current defence programme is unaffordable and tough choices will need to be made. It cannot be said too often that the programme for the next 10 years is £38 billion over-committed, a sum that we simply cannot fund. That is additional to any requirement to cut budgets beyond that. That over-commitment of the existing budget is the legacy of the last Government.

[Graham Jones]

Will the Minister accept that the reason for the £38 billion overspend is the Government’s choice to cut the deficit further and faster? Otherwise the money would be there.

[Peter Luff]

Labour Members just do not get it. It is not a matter of choice. The last Government made a choice to be—I shall choose my words with great care—a little disingenuous with the figures and to make commitments that they knew they could not meet. We have to deal with the £38 billion over-commitment before we address any budget deficit reductions, and that is the problem we face in the Ministry of Defence.