Strategic Defence and Security Review

Hugh Bayley Excerpts

Thursday 26th January 2012 Commons Chamber

[Mr Hammond]

My hon. Friend is absolutely right. Part of the answer to the questions raised by the hon. Member for Bridgend (Mrs Moon) is collaboration with NATO allies. They can share assets that they have and that we do not have, and we can reinforce their capabilities in other areas. The smart defence agenda is an important one—it involves collaboration among NATO allies in procurement to ensure that we get the best defence effect we can get with the limited budgets available.

As I have said, defence must make its contribution to delivering sound public finances, so even if the defence programme that we inherited had been in good shape, the spending review and the SDSR would have had to find savings to contribute to overall deficit reduction. However, the defence programme that the Government inherited was very far from being in good shape. At its heart, it had a £38 billion black hole filled with procurement projects that were at best hopelessly over budget and out of control, and at worst pure fantasy. They were projects announced by politicians—actually, mainly one politician—without any budget cover or prospect of ever being delivered, in a programme that had no proper contingency, no effective recognition of risk, and no provision for the “conspiracy of optimism” that was evident in MOD equipment cost estimates. The support programme systematically underprovided for the proper maintenance and sustainment of the equipment that was already in service. In short, Mr Deputy Speaker, it was a shambles.

[Hugh Bayley (York Central) (Lab)]

Will the Secretary of State give way?

[Mr Hammond]

I will give way to the hon. Gentleman, who will perhaps explain his way out of that.

[Hugh Bayley]

Were the capital programmes that the right hon. Gentleman’s Government inherited supported or opposed by the chiefs of staff at the time?

[Mr Hammond]

I am obviously not privy to the advice given to Ministers in the previous Government by their defence advisers, nor should I be, but if the previous Government were succumbing to recommendations from the defence chiefs, they were doing them no favours by pretending that they could deliver equipment programmes for which there were no funding lines or budget cover, and when there was no prospect of their materialising.

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[Hugh Bayley (York Central) (Lab)]

Defence debates in this House are best when Members stick to national security, rather than party political knockabout. I respect the Secretary of State, who I think is a very capable Minister, and wish him well in his new post—but, like my right hon. Friend the Member for East Renfrewshire (Mr Murphy), I regret the party political tone of some of his remarks, and feel that I should briefly respond.

I have been a Member for almost 20 years, and during that time, under Conservative Governments the defence budget has been cut as a proportion of national income, and under Labour Governments it has increased. Under the Major Government, between 1991-92—when I entered the House—and 1997-98, the share of national income, or GDP, spent on defence fell from 4% to 2.5%; under the Blair-Brown Government it rose from 2.5% to 2.7%. In a parliamentary question to the Chief Secretary to the Treasury last week, following the second tranche of redundancies, I asked what proportion of national income is spent on defence, and was told that it is still 2.7%. But the Chief Secretary continued:

“It is impossible to state exactly what percentage of GDP or gross national income will be spent in future years…However, I expect the percentage to remain above the 2% NATO target.”—[Official Report, 25 January 2012; Vol. 539, c. 240W.]

In other words, it will fall, and fall quite significantly.

[Dan Byles]

On those figures, does the hon. Gentleman not accept, however, that the international situation was changeable? We had the end of the cold war and the widespread demand for a peace dividend during the period that he referred to under the Major Government. We then had 9/11 and the wars in Iraq and in Afghanistan during the period that he referred to as the “Blair-Brown” years, whereas we are now out of Iraq and will shortly pull out of Afghanistan. He cannot look at the issue in isolation.

[Hugh Bayley]

The hon. Gentleman makes some fair comments, but the Government have not established that the level of risk facing the country is declining, so they have not made the case in defence and security terms for the reduction in expenditure that they are making.

The United States, the UK, France, Greece and Albania are the only NATO members that spend at or above 2% of their GDP on defence; the other 23 of the 28 NATO allies spend less. The Libya campaign showed that current European spending on defence is not sufficient to conduct an effective military operation against a poorly armed regime distracted by a civilian uprising in a sparsely populated country with only 6 million inhabitants. Within weeks of the start of military operations, European countries were running out of precision-guided missiles and needed to turn to the United States to provide them. We also needed to turn to the United States to provide surveillance aircraft to identify targets and to provide air-to-air refuelling.

All 28 NATO member states voted for the Libya campaign, but less than half participated in it and fewer than one third contributed to strike operations. In June 2011, in a speech in Brussels, the outgoing United States Defence Secretary, Robert Gates, said that

“many of those allies sitting on the sidelines do so not because they do not want to participate, but simply because they cannot. The military capabilities simply aren't there.”

That led Mr Gates, just before he left office, to question the future of NATO, and in the same speech he said:

“If current trends in the decline of European defence capabilities are not halted and reversed, future US political leaders…may not consider the return on America’s investment in NATO worth the cost.”

Robert Gates is not a maverick. He served as Defence Secretary under the Bush presidency and under Obama, and in that speech he articulated views that are frequently expressed by members of the United States Congress and other US speakers at meetings of the NATO Parliament Assembly, which I attend along with the right hon. and learned Member for North East Fife (Sir Menzies Campbell), who leads our delegation. Indeed, a report adopted by the economics and security committee at our most recent meeting in October 2011 stated:

“If anything, Secretary Gates was being diplomatic. Europe’s defence posture has grown woefully weak…It is time for Europe to get serious about this issue.”

In November, in a speech to the Australian Parliament, President Obama declared that the United States was a Pacific power, and said that maintaining a military presence in the Asia-Pacific region was a top priority and would not be affected by United States defence cuts—a point that he re-emphasised earlier this month in a speech at the Pentagon about the US comprehensive defence review.

Those statements from our American allies make it clear to me that we in Europe need to do more than we are currently doing. Although we stay above the NATO target of 2% of GDP spending on defence, our defence cuts in the UK make it harder for us to persuade our European allies of the need for them to do their bit and get their spending up to that target.

In President Obama’s speech at the Pentagon he said:

“the size and the structure of our military and defense budgets have to be driven by a strategy, not the other way around.”

The UK Government need to operate on the same basis. I therefore believe that the defence cuts that the Government have announced should be contingent on the successful implementation, on a Europe-wide basis, of a strategy to increase defence expenditure and make better use of the resources that we already have by eliminating waste and duplication.

The UK-France defence and security co-operation treaty is a step in the right direction. It will allow the shared deployment of aircraft and aircraft carriers and air-to-air refuelling capabilities, and I am sure that as a result capabilities will be provided more cost-effectively than if we did such things alone. The nascent Nordic defence co-operation is another example. But we clearly need more shared assets in Europe. Why are we not buying strategic airlift on a joint basis with allies, as NATO did with the airborne warning and control system, or AWACS—although the UK, of course, did not join that initiative? Why do we not do the same with air-to-air refuelling?

Most of all, we need better co-operation in our defence industries. The armed forces in Europe have more service personnel than the United States, but we are way behind in terms of defence budgets, investment and capabilities.

[Mrs Moon]

One way to resolve the problem of sharing capacity would be to have an agreement with Luxembourg, a land-locked country that has no coastline but two maritime patrol aircraft. Perhaps we could agree to share its maritime patrol capability, as we have none.

[Hugh Bayley]

My hon. Friend has made her point well. I would like us not only to make bilateral agreements with other countries but, far more, to look strategically across Europe at how we should restructure our defence industries to eliminate duplication and produce what we need—common equipment on a common basis. We should acquire major capital items of equipment that will be shared in NATO operations on a common basis.

In the few seconds that I have left, I would like to say a word or two about the local implications of the defence cuts for my constituency and the rest of Yorkshire. The latest figure that I have for the number of regular military personnel based in Yorkshire and the Humber is 14,730; for North Yorkshire the figure is 13,310, and in my constituency of York it is 880. The figures date from 2009, before the general election. If between now and 2015 those figures reduced in proportion with the overall reduction in the numbers of our armed forces—that is, by 8.5% or 9%—one might expect force reductions of about 1,300 across our region, of whom 1,200 would be in North Yorkshire and 70, perhaps, in York itself.

On the day last week when the Under-Secretary of State for Defence, the right hon. Member for South Leicestershire (Mr Robathan), made his written ministerial statement about the second tranche of redundancies, I tabled a number of parliamentary questions asking for these regional numbers at the time of the general election, in December 2011, and in 2015. At business questions last week I asked whether the Leader of the House could make sure that I got answers before this debate. I received a letter from the Minister with responsibility for defence personnel, but it did not contain the figures. I hope that those figures will be provided to me as soon as possible.