UK Shipbuilding
Jeremy Quin Excerpts(2 years, 9 months ago)
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The Minister for Defence Procurement (Jeremy Quin)
I am sure that the hon. Gentleman recognises that the resources and commitment that we have given to Royal Navy procurement are a real step change and exactly the kind of support that he expects to see delivered to UK shipyards.
Mick Whitley
I accept the point about the budget for defence and for shipbuilding, but when the Secretary of State for Levelling Up, Housing and Communities travelled to my constituency recently, he opted not to visit Cammell Laird. Perhaps he knew that the Government are falling far short in providing shipbuilders with the support that they need; perhaps he knew the welcome he was likely to receive from a workforce who have been failed by central Government for far too long. If levelling up is to become more than an empty slogan, we must recognise the enormous potential of British industry, and of shipbuilding in particular, to drive inward investment, create high-skilled work and build a more prosperous future for left-behind towns like Birkenhead.
As a lifelong trade unionist, I have spoken primarily about what investing in the future of UK shipbuilding means for British workers and industry, but national security must not be ignored. The stakes could not be higher. Putin’s appalling attack on the sovereignty and independence of Ukraine has shattered the peace that our continent has enjoyed for so long and has caused human suffering on a scale that none of us thought we would see again. We simply do not know what the future holds, but the appalling scenes that we are witnessing on the streets of Kyiv and Kharkiv are a powerful reminder of just how important it is that we build up our defence capacity at home. That must begin in our nation’s shipyards.
Once again, I urge the Minister to do everything in his power to ensure that fleet solid support ships and all future defence projects in the pipeline are built and designed in their entirety in the UK. That is the very least that our shipyards deserve.
The Minister for Defence Procurement (Jeremy Quin)
May I start by picking up on the remarks that the hon. Member for Birkenhead (Mick Whitley) made about Ukraine? His points were well made. In preparing for this important debate, I could not help thinking about my visits to Ukraine on behalf of the Ministry of Defence, which have included discussions about that proud country’s ambitions for its navy and for its shipbuilding enterprises. We are all deeply concerned; our thoughts are with all Ukrainians. I am glad that the hon. Gentleman made those remarks.
I congratulate the hon. Gentleman on securing the debate. He spoke passionately about what the industry has meant to his family, to him and to his community. I know that he speaks from the heart. I am glad that we have had this opportunity to speak before the launch of the shipbuilding refresh; I hope that we will speak again when it is brought before the House.
Shipbuilding is not only important to the hon. Gentleman, but vital to the United Kingdom. As he mentioned, his constituency has produced many of our finest ships. The first screw steamship to cross the Atlantic and the first guided missile destroyer in the UK were made in Birkenhead. So was the RSS Sir David Attenborough—I will stick with that name, if the hon. Gentleman does not mind—which is rightly a source of huge pride for Birkenhead as it does its important work in the Antarctic, even as we speak. I was pleased to hear about the number of applications—although I would like there to be more work for more of them—for the training scheme to work in the yard. It is one of the many brilliant training schemes around the country, and I am delighted that the work that we are all putting in for a successful future for our shipbuilding industry is being reflected in the enthusiasm of people coming forward to take those opportunities.
As a maritime nation, ships have long been the guarantors of our defence, the deliverers of our trade and the creators of endless opportunities for growth and expansion. However, we are conscious that the sector needs to be more resilient and more sustainable if it is to thrive in the 21st century as it has done historically. That is why the Defence Secretary was appointed shipbuilding tsar in September 2019. He has gathered the Government together to drive the renaissance in British shipbuilding and to enhance our position as a global leader in ship design and technology. Since his appointment, we have opened the National Shipbuilding Office, which is working closely with industry to drive transformative change across the whole of our shipbuilding enterprise.
We have brought forward plans through the integrated review and defence Command Paper to double Royal Navy investment in its new vessels to £1.7 billion per annum by the end of this Parliament, delivering the defence that the hon. Gentleman speaks of. We have confirmed our commitments for Type 26, Type 31 and fleet solid support ships, and set out our ambition, including for multi-role support ships and Type 32, among other future procurements. We have changed our policy to ensure that all new Royal Navy vessels, not just aircraft carriers, destroyers and frigates, are actively considered for build, as the right hon. Member for Orkney and Shetland (Mr Carmichael) said. Having sovereign capacity in our country for delivering our own defence needs is absolutely critical. He was right to allude to that. Through the application of social value to tenders, we are making clear the vital importance of driving wider value for the long-term success of our shipbuilding industry.
On exports, I am the first Minister for Defence Procurement in a generation who can help drive success not just in complex warships such as the Type 26, where we are working so closely with our Australian and Canadian friends, but in highly effective vessels such as Arrowhead, or Type 31, and offshore patrol vessels, with contracts already being awarded and opportunities to pursue them globally.
Learning the lessons of the Parker review, to which the hon. Member for Birkenhead referred, our task is to ensure that the existing success of warship procurement in this country is matched with a renaissance that works across the sector. The right hon. Member for Orkney and Shetland referred to the need for us to have successful commercial entities. He is absolutely right. I do a huge amount of work with the Scottish yards, whose input into the defence industry is absolutely vital. It is a pity that he is the only Member from a Scottish constituency present, because we could have had further discussions, but we are talking about the entire UK shipbuilding industry. It is spread right the way across the United Kingdom, and it is important that all of it thrives. I agree with his sentiments.
We will very soon be setting out our plans to go even further, with the publication of our refreshed national shipbuilding strategy. I have no doubt that this strategy will benefit not just our shipyards but the 1,685 registered businesses in this industry spread right across the UK, 99% of which are small and medium-sized enterprises. Our plans have been developed through extensive collaboration with industry, including businesses in the constituency of the hon. Member for Birkenhead, such as Cammell Laird. I would like to thank them for their insight and support.
As part of the strategy, we will be providing a 30-year, cross-Government shipbuilding pipeline, with a huge range of opportunities for UK shipyards. There are vessels of all types, sizes and complexity, creating a baseline of volume to encourage industry investment in facilities, infrastructure, innovation and skills. That means that they will also be geared up to win commercial and export orders as major new global markets emerge, particularly in green shipping.
Given the vast Government order book, other domestic orders and the export prospects being supported by the Department for International Trade, and with the National Shipbuilding Office seeking to maximise UK work wherever possible, I am convinced that British shipyards are likely to be very busy in the coming years.
While the upcoming strategy extends to all types of Government vessels, at its heart remains an ambition to keep strengthening the Royal Navy, and a critical part of that is our fleet solid support ships, to which the hon. Member for Birkenhead referred. That came as no great surprise; I know that this is a subject close to his heart. These ships will not just be a vital part of our formidable future force alongside our new Type 31 frigates, our two magnificent carriers, our next-generation nuclear submarines, our mine-hunting ships and our multi-role support ships; they are also a great example of how taxpayers’ money is being invested in a way that ensures the long-term future of UK shipbuilding.
Our commitment to the fleet solid support programme was outlined in the defence Command Paper published this time last year, and it is supported by the £24 billion uplift to the defence budget over four years. I can assure the hon. Gentleman that this project will be delivered very much in line with the new strategy. In other words, it will encourage sustainable investment to ensure the long-term future of our domestic shipyards. I know he will appreciate the fact that, as we are in the midst of a competitive process, I am limited in what I can say, but we have designed the competition to emulate the success of the ongoing Type 31 frigate programme in Rosyth. This means that while we welcome the opportunity to learn from international best practice, we have also been very clear that a substantial proportion of the build, including integration, will be carried out in the UK. We have had a very positive response from industry, and each of the four consortia bidding for the programme includes substantial UK involvement. The bidders are also required to set out plans to help improve the capacity and capability of the UK shipbuilding sector, as well as how they will contribute to wider social value.
Mr Carmichael
On the question of the future strategy, we know that shipping is going to have to tackle its carbon emissions, and some of the most exciting and innovative work in that sector is now being done in relation to hydrogen as a source of power for ferries and other seagoing vessels. Will that sort of future-proofing be part of the Government’s strategy?
Jeremy Quin
The right hon. Gentleman will forgive me if I do not reveal the full details of the strategy in this packed Chamber this evening, but I can absolutely assure him that it will cover future-proofing and the future of UK shipbuilding. I have mentioned the greener path ahead for the industry, and for shipping in general, and we absolutely wish to embrace that. I look forward to having an opportunity to say more to him about this.
The fleet solid support strategy will create a further major stepping stone to success for our vital shipbuilding industry so that our shipyards will be ready to win work beyond the life of this project, whether that is for Government vessels of any kind, for foreign exports or for domestic orders.
There is a rich and potent future for the industry, and we will be embracing the trends that will make for a successful industry. I hope that I have been able to reassure the hon. Member for Birkenhead, knowing that he would raise the matter, that the fleet solid support programme is being delivered in line with our wider aims to make the sector more competitive and more sustainable. I hope that I have also been clear that we will take every opportunity we can, not just to increase jobs, bolster skills and secure export contracts in the coming months and years, but to truly ensure that we are bringing shipbuilding home. My colleagues and I look forward to being able to commend to the hon. Gentleman and to this House a refreshed national shipbuilding strategy in what I can assure him will be the very near term.
Question put and agreed to.
Defence Equipment Plan
Jeremy Quin Excerpts(2 years, 10 months ago)
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The Minister for Defence Procurement (Jeremy Quin)
I am pleased to place in the Library of the House a copy of the 2021 Defence Equipment Plan Report, which sets out our plans to deliver the equipment needed by our armed forces to defend the country and protect our national interest.
This year’s equipment plan report is one of the most important in recent years as it implements the strategy and financial reset provided by the integrated review, the defence Command Paper and the spending review. The integrated review outlined the evolving nature of the threats we face. This equipment plan sets out how our military capability will evolve to meet these threats within an affordable financial envelope.
This equipment plan sets out how we are funding the capabilities we need, including more ships for the Royal Navy, a new batch of F-35s, a new medium helicopter and a major upgrade to our land equipment. This represents a significant enhancement on last year’s capability plans while, through additional investment and tough prioritisation, we have reversed the £7.3 billion pressure on the plan outlined last year to a surplus.
This year is the first since 2018 when we have entered a new financial year with a funded contingency for the equipment plan. We have funding set aside to deal with urgent operational requirements and funding set aside for future research and development and its exploitation. We have made good progress in the first year of delivery end for the first time in many years, we expect to live within budget without Ministers having to take decisions on savings measures in year or running central savings exercises.
This has been possible by setting a clear vision for the armed forces through last year’s integrated review and defence Command Paper, which has allowed us to retire less relevant equipment and refocus our programme on the kit we need for the future. We are making progress on delivering this change, including cancelling the Warrior sustainment programme and setting out plans for a more high-tech and agile Army as set cut in our recent Future Soldier publication. This equipment plan relies on fewer low confidence efficiency measures than in previous years and our plans to reduce costs are supported by significant investments in acquisition, support and digital programmes to improve the way the Department operates.
We have, alongside capability investments, reversed the decline in defence R and D spend with a £6.6 billion ringfenced commitment. This will help reduce the risks associated with identifying and bringing into development the game-changing future capabilities we will need to meet the future threat.
However, delivering state of the art defence capabilities carries inherent risk. On a plan of this scale and over this timeline there will always be risks to affordability. We are clear-eyed on those risks and set them out in our report. As the National Audit Office have said, the MOD is responsible for some of the most technically complex, risky and costly procurement programmes in government. New, large and complex programmes like the Future Combat Air System, which will deliver the next generation of combat air capability, and the replacement warhead, which will allow us to renew the UK’s nuclear deterrent, are extraordinarily complex endeavours. We continue to carry out and publish our own independent challenge of costings to help us understand and mitigate financial risk. Excluding Dreadnought, which has its own contingency funding, the risk identified in programmes which were reviewed both last year and this reduced by £0.3 billion, showing an improvement in the Department’s costing and management of risk. However, additional risk inevitably arises from new programmes entering the plan, including the warhead programme.
Planning over 10 years is inherently uncertain and we must be able to respond to changing threats and project-specific circumstances. As challenges emerge on programmes which delay expenditure, we will be flexible in accelerating other programmes to maintain momentum and where possible reduce cost. The HM Treasury £10 billion contingency for Dreadnought shields the rest of the equipment plan from changes in annual spend on our largest and most complex programme. We continue to reduce risk through the forward purchase of foreign currency.
New funding has enabled key decisions to be taken and priorities set but this alone is not enough to deliver on time and to budget. Having the right skills, tools, data and processes are critical. The Department has made real progress, which we set out in our report, but we recognise there is more to do. To deliver value for money for the taxpayer we have invested in our acquisition reform programme which aims to improve the speed and agility of our procurement processes and we are working to improve the capability and availability of senior responsible owners for programmes.
The nature of defence means that the plan is not without risks to which we will be agile in responding, however, new funding, a clear vision and a balanced plan mean that this is a very different programme to those of recent years.
Attachments can be viewed online at:
http://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2022-02-21/HCWS611.
[HCWS611]
Oral Answers to Questions
Jeremy Quin Excerpts(2 years, 10 months ago)
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Christian Matheson (City of Chester) (Lab)
The Minister for Defence Procurement (Jeremy Quin)
We recognise the need to manage risk and ensure resilience in our manufacturing and supply chains, including rotary wing. Through past and current investment in rotary wing capabilities, including Wildcat and Apache, and upgrades to Merlin and Chinook, the UK industrial base remains well placed to support existing and future helicopter platforms, and continues to be a market of great interest to our industrial partners.
Grahame Morris
I thank the Minister for that response and I declare an interest as chair of the Unite group of Labour MPs in Parliament. Further to my Defence question of 15 November, when I asked the Minister what steps his Department was taking to ensure the resilience of the helicopter supply chain in the UK, will he now assure the House that, whoever wins the contract, the new Puma-replacement helicopters will be both manufactured and assembled here in the United Kingdom?
Jeremy Quin
As we and my right hon. Friend the Secretary of State have said, the competition for the new medium helicopter contract, to which I believe the hon. Gentleman refers, will be launched very shortly. Given the skills and capabilities in this country and the nature of that competition, I am confident that a very substantial amount of benefit will flow to the UK as a result of that procurement.
Christian Matheson
I also declare an interest and I echo the words of my hon. Friend the Member for Easington (Grahame Morris). We do not want to get into another situation like the one with the fleet solid support ships. Will the Government ensure that the value to the UK of placing the contracts with UK suppliers and UK manufacturers is included and priced into the deal and the contract?
Jeremy Quin
The hon. Gentleman makes a fair point. It is absolutely critical that we ensure that the social value associated with the contract is fully and fairly reflected in the tendering process. He has my assurance that we will do that and, as I said, it will not be long before he will be able to see more on that subject.
James Gray (North Wiltshire) (Con)
I entirely agree with others who have spoken about the importance of British manufacturers producing these things, but we have a very strong relationship with the United States of America and I welcome the fact that we have ordered 50 new Apache attack helicopters and are upgrading our Chinooks. Does the Minister acknowledge, however, that Boeing UK is now the fourth or fifth largest supplier to the MOD and that, as a British manufacturer, it is hoping to export goods—the new aeroplanes—to America soon?
Jeremy Quin
It is indeed, and my hon. Friend is absolutely right that Boeing is a strategic partner of ours. It also invests heavily, and I pay tribute to its work to enhance apprenticeships and its academic work, including in the far north of Scotland from our base at Lossie. It is an important strategic partner that brings value to the UK.
Chris Evans (Islwyn) (Lab/Co-op)
I am going to do something quite surprising and agree with the Secretary of State when he says, of the helicopter competition, that he does not want a “here today, gone tomorrow” supplier. What are the Minister’s plans to ensure that there is long-term investment in the UK helicopter industry, particularly in high-value engineering design and manufacturing jobs; apprenticeships; and enduring skills development in this vital industry?
Jeremy Quin
On the NMH, to which the hon. Gentleman refers, it is likely, given the timescale—we want to have the helicopters in service in 2025 or as close to that as possible—that we will be seeking to procure an existing platform. However, that absolutely does not gainsay the fact that we will want to see real social value created in terms of engineering skills and capabilities in this country. That will be part of the competition.
Neale Hanvey (Kirkcaldy and Cowdenbeath) (Alba)
The Minister for Defence Procurement (Jeremy Quin)
I am delighted that we are en route to the complete remediation of Dalgety Bay. Environmental sensitivities inevitably have a significant impact on the length of time that it is taking to complete the project. MOD and SEPA officials last met formally on 24 November. SEPA also has representatives on site continually to monitor the work that is being undertaken.
Neale Hanvey
I give the apologies of my hon. Friend the Member for East Lothian (Kenny MacAskill), who has been turfed off a train on his way to the House.
I thank the Minister for that answer. The people of Dalgety Bay in my Kirkcaldy and Cowdenbeath constituency have had to put up with radioactive waste on the shore since the second world war. Thanks to the dogged determination of my predecessor, Roger Mullin, and my persistence, work on that began last May. However, the Ministry promised me and the community that it would keep us updated on progress, but we have had nothing from the MOD since May 2021. Will the Minister say why, and make sure that an update is forthcoming?
Jeremy Quin
I can give the hon. Gentleman an update now. As I think he is aware, we assumed that it would take two seasons to do the complete remediation. I very much hoped that it would therefore have been concluded by the autumn of this year. He is aware of the issues with birdlife that ensure that there is only a set period of time in which we can work. We applied for, and got, extended time to work last summer, and we will apply again for extended time this year. I hope that that will be sufficient, but I have to share with the hon. Gentleman that work may not be concluded until 2023. I hope that that will not be the case, but it is possible; we are keeping it under review. I will write further to the hon. Gentleman.
Jane Stevenson (Wolverhampton North East) (Con)
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
The Minister for Defence Procurement (Jeremy Quin)
Over and above the £5 billion already committed to satellite communications, we are investing an additional £1.5 billion in space capabilities. The defence space strategy sets out our focus on intelligence, surveillance, and reconnaissance, satellite communications, space domain awareness and space commander control. This clear strategic direction has been welcomed by industry and allies alike.
Stephen Metcalfe
Space, in all its guises, presents us with an unparalleled opportunity to drive British science and technical innovation, create well-paid and rewarding jobs, boost our economy, and above all defend ourselves. Can my hon. Friend expand on what he has said, and tell the House what the MOD is doing to ensure that we deliver all those opportunities?
Jeremy Quin
My hon. Friend is correct in every respect. That additional £1.5 billion of investment implies very significant space R&D and the jobs, skills and expertise that go with it. It includes investment in things such as ISTARI, our ISR programme, It also includes innovation spending, as part of the £1.5 billion package, and programmes such as Minerva. Through that investment, we are not only ensuring that we meet the threats of the future, but helping to build capability, expertise, skills and jobs that will serve defence and the wider civil space programme.
Emma Hardy (Kingston upon Hull West and Hessle) (Lab)
Mrs Sheryll Murray (South East Cornwall) (Con)
The Minister for Defence Procurement (Jeremy Quin)
As my hon. Friend’s son will be well aware—
Jeremy Quin
I do apologise. I am even more pleased that my hon. Friend’s daughter graces the Royal Navy. She will know of the increasing importance of space to all the armed forces, and I can assure her that we are actively looking at supporting the wider Government ambition to have private companies launch from the UK this year.
Dan Jarvis (Barnsley Central) (Lab)
Jeremy Quin
We are fighting over the privilege of answering my hon. Friend’s question. As my the Minister for Defence People and Veterans, my hon. Friend the Member for Aldershot (Leo Docherty) said earlier, there are 21,000 apprentices in the armed forces at any one time. Also, we are committed to lifelong learning: for five years after people leave the services, they can apply for and get support to retrain. It is a great opportunity for our service personnel, who have terrific skills.
Dave Doogan (Angus) (SNP)
Does the Secretary of State agree that the same esteem, respect and co-operation that the UK enjoys with Australia will be a feature of UK-Scottish relations on matters related to defence and security after independence? Crucially, though, as an independent state Scotland will, unlike today, have a seat at the table and a role in the decision-making process.
Defence Space Strategy
Jeremy Quin Excerpts(2 years, 10 months ago)
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The Minister for Defence Procurement (Jeremy Quin)
Today I am pleased to publish the defence space strategy. This strategy sets out a vision for the Ministry of Defence as a global actor in the space domain. It articulates how the MOD will deliver the national space strategy’s “protect and defend” goal through capabilities, operations and the growth of a space workforce. It also emphasises the value of alliances and partnerships in pursuit of a safe and secure space domain. I am placing a copy of the DSS in the Library of the House.
The DSS explains how the MOD has apportioned its spending review 2020 allocation for space capabilities and activity: £1.4 billion over 10 years, in addition to the £5 billion over 10 years already allocated to our future Skynet satellite communications capability.
The DSS also reinforces all four of the 2021 integrated review’s objectives to: strengthen security and defence at home and overseas; build resilience; sustain strategic advantage through science and technology; and shape the international order of the future.
Attachments can be viewed online at: http://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2022-02-01/HCWS576/
[HCWS576]
Defence Estate: Annington Property Ltd
Jeremy Quin Excerpts(2 years, 10 months ago)
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The Minister for Defence Procurement (Jeremy Quin)
The Ministry of Defence—MOD—continues to review its estate to ensure value for money.
In 1996, the Ministry of Defence, in what was effectively a sale and leaseback agreement, granted a 999-year lease of over 55,000 service family accommodation homes to Annington Property Ltd and immediately leased the homes back on 200-year underleases. In 2018, the National Audit Office concluded in its review of the arrangements that taxpayers are between £2.2 billion and £4.2 billion worse off as a result of the sale and leaseback arrangements.
Given our obligations to secure value for money, we have reviewed the MOD’S current arrangements with Annington and now set out the steps that the MOD is taking to deliver greater value for money for the taxpayer in relation to service family accommodation.
First, the MOD engaged highly experienced advisers and counsel to deliver a settlement with Annington in the site rent review process. This settlement achieves value for money, and removes ongoing uncertainty for the Department; we believe it to be a good outcome and a fair settlement. The settlement resulted in a change in the overall adjustment to open market rents from 58% to 49.6%.
Secondly, the MOD continues to reduce the number of untenanted properties which it holds since these otherwise represent a liability for the taxpayer, by returning these to Annington under the terms of the lease.
Thirdly, the MOD can confirm that the Department will explore the exercise of its statutory leasehold enfranchisement rights to buy out Annington’s interest in the homes and gain full ownership rights. Initially, the MOD has made a single claim for one house, with the intention to submit a further claim in respect of another house in the near future. It is hoped that this test case will establish certain key principles. The cost of enfranchising these houses will be in accordance with the statutory enfranchisement formula, fixed at the date of the notice of claim, and the price will be agreed between the parties or determined by an independent tribunal. If the cost of recovering full ownership of the units from Annington is less than the present value of the MOD’s ongoing liabilities, such a transaction is likely to represent good value for money. The MOD would then benefit from any future appreciation in value of the units. Accordingly, the MOD has served notice on Annington under section 5 of the Leasehold Reform Act 1967 of its desire to enfranchise a house currently leased from Annington. Annington, through its lawyers, has notified the MOD that it is considering the impact of the claim and has put the MOD on notice of a potential dispute.
A successful enfranchisement programme would also provide the MOD with more flexibility in the management of its estate to the benefit of defence, tenants, and potentially wider Government objectives.
[HCWS563]
Oral Answers to Questions
Jeremy Quin Excerpts(2 years, 11 months ago)
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Nick Smith (Blaenau Gwent) (Lab)
The Minister for Defence Procurement (Jeremy Quin)
As reported by the Infrastructure and Projects Authority in July 2021, the budgeted cost of Ajax is £6.354 billion to manufacture the vehicle and bring it to full operating capability and for its first period of service. Forecasts are updated twice yearly and our current forecast is that we will deliver under budget at £5.915 billion, though that is subject to change. That includes our £5.5 billion firm contract with General Dynamics.
Nick Smith
Thank you, Mr Speaker, for the short tribute to our comrade Jack Dromey.
The latest document on Ajax is enough to make anyone weep. It points to an alphabet soup of accountabilities and a saga of poor procurement, and says that the vehicle thus far is not fit for purpose. And of course it has been a health and safety minefield. This project matters for our military capability and for the 4,000-strong workforce in south Wales and across the UK. In his December statement, the Minister ended on an optimistic note when responding to a question about the workforce from my hon. Friend the Member for Merthyr Tydfil and Rhymney (Gerald Jones). Can the Minister give us the expected timeline for fixing these issues?
Jeremy Quin
The hon. Gentleman is correct to say that I sounded an upbeat note in terms of the jobs in south Wales. We were right to commission the report. It was a thorough report and I believe it was right to publish it so that this House knew exactly where we stood on Ajax. On the question of employment, there are some 4,100 jobs across the country in 230 companies, and the programme is particularly important to south Wales. I was upbeat to the extent that I believe that we must work together with General Dynamics to fix this issue. We have now received a draft report from Millbrook, as I outlined in my last statement, and there is work to be done on that. We may not really get to grips with that until July, but progress is being made. Certainly I believe that the independent work that General Dynamics is doing in Horiba-Mira and elsewhere can resolve these issues. We need to test that very carefully, but we have invested very heavily in this project, it is an important capability and we are determined to make it work if we possibly can.
Dame Caroline Dinenage (Gosport) (Con)
I would also like to express my condolences on the loss of Jack Dromey, who made his maiden speech the same day that I made mine. I was very fond of him.
I have no doubt that some of the procurement processes that were inherited from the last Labour Government led to some of the flaws in the Ajax programme. I say that because it is emblematic of a catalogue of wasteful decisions such as the selling off of the Royal Naval Hospital Haslar in 2009 for £3 million when it had reportedly been valued at £52 million. Could the Minister please assure me that the MOD’s procurement and disposal decisions, such as that involving Fort Blockhouse at Gosport, will maximise the benefit for the taxpayer and for local communities?
Jeremy Quin
I congratulate my hon. Friend on her elevation; that is good to see. She refers to the approval process for Ajax, which was indeed under the last Labour Administration. I think it passed maingate business approval in March 2010, around the same time that the National Audit Office was pointing out the multi-billion pound black hole that the Labour party was leaving in Defence at the time. I do not believe that Fort Blockhouse will be disposed of until 2023, so there is time to get it right. I would be more than happy to meet my hon. Friend if that is helpful.
Chris Evans (Islwyn) (Lab/Co-op)
I join other voices in expressing my own sadness at the loss of our colleague Jack Dromey. Jack was someone who committed his entire life to improving the lot of others. He was, and is, an example to us all.
Last month, the Government’s own report found that Ministers were in the dark about the serious issues surrounding Ajax for a whole two years before the current Minister was informed in 2020. During that time, soldiers were put in a vehicle that could cause harm. What new measures have been put in place to ensure that Ministers are fully on top of what is going on in their Department?
Jeremy Quin
There is a whole raft of measures. I have met the hon. Gentleman and he is aware from reading the report of what has been set out. We immediately accepted the vast majority of recommendations. There are about two recommendations that need to be worked on, but the intent is there and our intent is to adopt them. One of the most important aspects is to make certain that all people with a view on safety are part of the decision making process, so that everyone with a view has an opportunity to air it and everyone is listened to with respect. We are also putting health and safety input into the highest ranks of the decision making process, so that major decisions cannot be made, either by Ministers or by other parts of the organisation, without that health and safety input right at the top of the organisation. These measures will help to ensure that such a situation does not reoccur.
Dr Julian Lewis (New Forest East) (Con)
Alun Cairns (Vale of Glamorgan) (Con)
The Minister for Defence Procurement (Jeremy Quin)
My right hon. Friend has fought and fought for the retention of more military personnel at St Athan. At his request, I visited the site personally and re-evaluated our options. Unfortunately, the historic agreement entered into with the Welsh Government does indeed make such—[Interruption.] I do apologise, Mr Speaker, and I apologise to my right hon. Friend—I wanted first to give an answer on future solider in general before getting on to the specifics—[Laughter.] I know exactly what my right hon. Friend is going to ask, because he has been assiduous in demanding more troops at St Athan.
Before I get on to that, future soldier is good news for Wales, bringing additional investment into the Army estate of around £320 million. I know Brecon will be delighted that Brecon barracks—the headquarters of the 160th (Welsh) Brigade—will be retained. We have identified Caerwent training estate for investment to host not one but two units—including the Queen’s Dragoon Guards—and, in north Wales, a new reserve unit of the Royal Welsh will be established in Wrexham.
Alun Cairns
I associate myself with the comments made about our friend and colleague Jack Dromey.
The Welsh Government’s refusal to extend the lease of the land at MOD St Athan effectively blocked a new major military unit coming to St Athan. What reassurance can the Minister give to the soldiers based at west camp? Do the Welsh Government have any right to the land on which they are based? If so, are they at risk of being evicted in the same way as those soldiers who were based at east camp?
Jeremy Quin
No, they are not. The good news is that the Ministry of Defence holds the freehold for the west camp land, which was not covered by the historic agreement made with the Welsh Government. My right hon. Friend has tackled me on this issue on so many occasions, and I went to visit the camp. We could not put new units into St Athan given the historic agreement with the Welsh Government, but west camp is MOD freehold and we will retain our forces there.
Stephen Kinnock (Aberavon) (Lab)
I associate myself with the tributes to Jack Dromey. He was a true friend and a credit to the House.
The Minister spoke about the future soldier programme in general terms, which connects to the Armed Forces Act. He made a welcome concession by agreeing to publish data on both investigations and prosecutions at all stages of the service justice system. What will the Government do if conviction rates for one or more of these serious crimes are concerningly low? Will the Government reconsider their approach and finally recognise that these cases should be dealt with by the civilian judicial system, and what impact does the Minister think that the Armed Forces Act 2021 will have on the Government meeting the target they have set themselves for 30% of Army recruits to be—
Richard Drax (South Dorset) (Con)
Thank you, Mr Speaker. May I, too, pass on my condolences to Jack’s family and friends? It is indeed a sad loss.
I am clutching at two words—Army estate—in asking this question. On a recent visit to the Special Boat Service—our Marines special forces—I was shocked to find that it does not have a proper aquatic centre. Will my hon. Friend the Minister tell me and the House when and if the Special Boat Service will get a proper aquatic centre to do vital training in?
Jeremy Quin
I am aware of the discussions and the proposal and I have seen some suggestions, but I am not in a position to give any detail to my hon. Friend at the moment. I will look into it and write to him.
Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
Bob Seely (Isle of Wight) (Con)
The Minister for Defence Procurement (Jeremy Quin)
The defence and security industrial strategy provides a more flexible approach to determine the right acquisition strategy for any given capability, in line with our priorities and national security requirements. Where tenders are used, they are designed to be fair, open and certainly accessible to domestic contractors.
Bob Seely
Wight Shipyard Co. in my constituency recently raised with me its concern about the niche criteria and very short timeframes for the Ministry of Defence’s special purpose ship contract. Will my hon. Friend reassure me that all MOD contracts are fairly given out and fairly tendered to all contractors in the country, including smaller contractors such as Wight Shipyard?
Jeremy Quin
My hon. Friend is an assiduous advocate for the Island and he was right to raise this issue with me before Christmas. I looked into it and have written to him and another hon. Gentleman on the subject. The requirement is for an existing vessel that can enter service very quickly to help the Royal Navy perform, at pace, trials on autonomy and the use of modular persistent operational deployment systems. I am satisfied that the tender for this vessel is fair and open. It has attracted a significant degree of interest from a wide range of suppliers, and they will have to compete along the lines outlined.
Dave Doogan (Angus) (SNP)
The Government are invariably keen to talk up their role in the manufacturing success story of Scottish warship building, and the Minister knows exactly the extraordinary private investment that has been made by BAE on the Clyde and by Babcock at Rosyth, and about the state of the art manufacturing process, equipment and, crucially, apprenticeships. Will he now commit to rewarding that investment by unequivocally ensuring that the fleet solid support ships are built in whole, not in part, in Scottish and, if necessary, other UK yards, and categorically commit to using UK steel?
Jeremy Quin
I think the hon. Gentleman should pay tribute to what this Government are doing in terms of investment in shipbuilding. We are a phenomenal investor in shipbuilding. BAE and Babcock are doing a tremendous job, with a huge number of ships coming through the production line. I am not going to prejudge a tender—that would completely contradict what I said in my previous remarks. However, if only the Scottish Government could take a leaf out of our book in the way in which they work with Ferguson’s, I think we would all be better off as a shipbuilding industry.
Jonathan Gullis (Stoke-on-Trent North) (Con)
Fay Jones (Brecon and Radnorshire) (Con)
The Minister for Defence Procurement (Jeremy Quin)
I think my right hon. Friend will do so. I have been to Brecon previously with my hon. Friend, who has campaigned relentlessly to retain the barracks, and I was delighted to confirm that that would be the case. It is the right decision for the Army, for Wales and indeed for Brecon.
Stephen Kinnock (Aberavon) (Lab)
The Minister made a welcome concession at the end of the debate on the Armed Forces Act 2021 to publish data about investigations and prosecutions. What will the Government do if the conviction rate for one or more of these serious crimes is concerningly low? Will they reconsider their approach? What impact does the Minister think the Act has had on meeting the target of 30% of Army recruits being female by 2030, particularly given that the current trends mean that that target will not be met until 2063?
Jeremy Quin
As my hon. Friend might be aware, we recently announced a closer working relationship with Japan on elements of the future combat air system programme. That followed on from talks that my right hon. Friend the Secretary of State and I had last September in Tokyo. The Japanese Government and we see a lot of benefit in working together on defence equipment programmes.
Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
Andrew Jones (Harrogate and Knaresborough) (Con)
The Department is investing in emerging technologies around the country as part of the defence supply chain. What steps is the Minister taking to ensure that the next generation of armed forces personnel, including those at the Army Foundation College in Harrogate, are trained to take advantage of them?
Jeremy Quin
I thank my hon. Friend for the question. We have more than 1,000 science, technology, engineering and mathematics—or STEM—representatives. We ensure that about 90% of all non-commissioned roles have the opportunity to take apprenticeships, which go right the way across new areas of skills, including STEM skills. That includes the outstanding Harrogate College. From memory, part of the syllabus includes space, autonomy and cyber. We are ensuring that we are absolutely at the cutting edge.
Tony Lloyd (Rochdale) (Lab)
Mr Kevan Jones (North Durham) (Lab)
I thank the Minister for Defence Procurement for his letter on the Navy’s special purpose vehicle and the changes he has made to the procurement process, but that will not get us away from the fact that the money has to be spent by March, which means that the vessel will be built or procured from a Dutch company, Damen. Why is he not backing British industry? As my right hon. Friend the Member for Warley (John Spellar) said, this is a £10 million contract that will go to a Dutch yard, rather than be spent in the UK.
Jeremy Quin
The right hon. Gentleman has already decided how our competition will end, which is unwise. We have multiple potential providers of a vessel that needs already to have been built, so we are going through a buying process and we will see how that procurement exercise ends.
Philip Dunne (Ludlow) (Con)
May I commend my hon. Friend the Minister for Defence Procurement for the care that he is taking in dealing with the challenges of the Ajax contract, and for the transparency with which he is keeping the House up to date with the problems? Does he agree that the production contract, which was entered into in 2014, was characterised by transferring risk to the contractor? Had we followed the practice of the previous Labour Government, trumpeted by the shadow Secretary of State, the risk would have stayed with the Ministry of Defence and the taxpayer.
Jeremy Quin
My right hon. Friend is absolutely right. Had this been like the Nimrod situation, where £3.7 billion was wasted by the previous Government and they attempted to blame it on us, that would have been where we are, but we are not; we have a firm-price contract with General Dynamics.
Joanna Cherry (Edinburgh South West) (SNP)
Redford barracks in my constituency has had another stay of execution to 2025. As the UK Government seem unmoved by arguments for retaining the defence estate in Scotland, will the Minister consider transferring the land at Redford to the City of Edinburgh Council so as to offset some of the economic impact of the closure of the barracks?
Ajax Noise and Vibration Review
Jeremy Quin Excerpts(3 years ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
The Minister for Defence Procurement (Jeremy Quin)
With permission, Madam Deputy Speaker, I would like to make a statement to update the House on Ajax, which is an important capability and a vital step-change in the way the British Army will operate on the future battlefield. It will provide ground-mounted reconnaissance, allowing the Army to understand the battlefield in all weathers, 24 hours a day.
As part of our £41 billion investment in Army equipment and support over the next 10 years, this modernisation is critical to address future threats. This is a vital investment, and the Defence Secretary and I have been deeply concerned about progress on this troubled project, which has been running for over 11 years since its commencement in March 2010. That is why we have been thoroughly focused on the project, why I insisted earlier this year that no declaration of initial operating capability would be made without ministerial involvement and why we asked the permanent secretary to commission a report from the Ministry of Defence’s director of health, safety and environmental protection on the health and safety concerns raised by noise and vibration. I am today publishing that report, and placing a copy in the Library of the House and in the Vote Office.
Over the past 35 years, there have been some 13 formal reports on defence procurement; we know the foundations that can build success. Openness, good communication and collaboration within Defence and the ability to act as an informed and challenging customer are vital. This health and safety report has highlighted shortcomings that need to be addressed, not just in health and safety, but more broadly. The review finds serious failings in the processes followed. The result was that personnel worked on a vehicle that had the potential to cause harm. The review finds that the failure was complex and systemic; that a culture exists of not treating safety as equally important as cost and time in the acquisition process; and that, from a cultural perspective, the Army did not believe it was potentially causing harm to people, especially from vibration, as it was tacitly expected that soldiers can and should endure such issues.
As I informed the House on 18 October, we have contacted all personnel identified as having worked on Ajax. Forty declined to be assessed for hearing but I am pleased to report that the vast majority of the remainder have returned to duty with no health impact. As of 9 December, 17 individuals remain under specialist out-patient care for their hearing, some of whom are again expected to return to duty with no health impact. Eleven individuals have had long-term restrictions on noise exposure recommended, potentially requiring a limitation in their military duties. Seven of them had pre-existing hearing issues prior to working on Ajax, but four did not.
In addition, four individuals who worked on Ajax have been discharged on health grounds, in some cases for reasons wholly unrelated to hearing loss. Although we cannot yet establish a definitive causal link, it is possible that Ajax may have contributed to the current hearing loss in a small number of individuals. It remains the case that no individuals have had long-term restrictions or been discharged as a result of vibration. However, assessment for both hand-transmitted and whole-body vibration takes time and requires specialist assessment, and these continue.
I will set out the key points from the review. General Dynamics UK is responsible for the design and build of the Ajax vehicles. The vehicles that it delivered for use in the trials had levels of noise and vibration that were higher than usually expected in tracked vehicles and have been proven to be above the statutory limit. That exposed our personnel to potential harm.
That exposure was not prevented by the Ministry of Defence due to a series of failures to act when concerns were raised by expert advisers and by soldiers operating in the vehicles. For example, an MOD safety notice in December 2018 said that design upgrades were required to reduce vibration, but this was not acted upon. MOD safety cases and safety management used GDUK calculations that were not independently assured, despite experts at the Defence Science and Technology Laboratory advising that the calculations should not be relied on.
A report from the Defence Safety Authority in May 2020 identifying some of these issues and entitled “Serious Safety Concerns on Ajax” was retracted and not pursued, either by the DSA or by the project team in Defence Equipment and Support. Multiple warnings from the DSTL and from the Armoured Trials and Development Unit, which was running the trials, were not actioned, even when the ATDU commanding officer questioned the approach as having the potential to expose soldiers to a known hazard, which he stated was not a defendable position.
Overall, the report makes 20 recommendations. The MOD accepts all those relating specifically to armoured vehicle procurements, the regulation of safety for land equipment and the broader approach to safety in defence. Recommendation 9 relates to avoiding the concurrent running of the demonstration and manufacture stages in future projects. That recommendation needs to be considered carefully to ensure that we capture the safety imperatives while not preventing sensible spiral development or, for example, the parallel construction of classes of warship. I will update the House on that, alongside recommendations 12 and 14, which also need consideration of how to best implement them, building on existing work on approvals and senior responsible owners.
I will also update the House on the project more broadly. We have a robust, firm price contract for the delivery of 589 vehicles at a cost of £5.5 billion. We are ensuring that we protect our commercial position under the contract and will not accept a vehicle that is not fit for purpose. It remains impossible to share with the House 100% confidence that the programme will succeed or, if it does, the timing of achieving full operating capability. However, we are working closely with General Dynamics on noise and vibration and it is showing great commitment to resolving these issues. This very advanced fighting vehicle project employs 4,100 in south Wales and across the UK. We all want it to succeed and deliver what the British Army requires.
The Millbrook trials to baseline the vehicle’s characteristics have completed and we expect to receive the conclusions shortly. In parallel, General Dynamics has been developing its theories and trialling design modifications to address vibration. We expect to receive its analysis in the new year, following which we will, if appropriate, undertake thorough testing of its proposed modifications to satisfy ourselves on their efficacy.
Part of our analysis is also looking at the performance of the headset used in Ajax. Although the noise profile on Ajax is noticeably different from that of other armoured vehicles, following tests on in-service headsets we took in November a precautionary measure to limit temporarily the amount of time personnel operate while using them in other armoured fighting vehicles. Acoustic testing of our in-service headsets is under way at test facilities in the UK and overseas. We are also testing other headsets to establish whether they will meet our requirements and provide additional attenuation. Once this analysis is complete, we expect to be able to relax the temporary restrictions or implement appropriate mitigations. In the meantime, we remain able to maintain our operational commitments.
The work on Ajax has also highlighted the significant number of personnel across defence whose exposure to noise results in short or long-term restrictions to their military duties. I have therefore asked the MOD permanent secretary to look further at that issue to ensure that we are doing all we can to prevent avoidable hearing loss in our people.
In conclusion, the Ajax health and safety report makes for very difficult reading. It lays bare a deep malaise, which is cultural and results in systemic failures across our organisations. I am grateful to David King and his team for their work and grateful for the candour of many who contributed to the review. There are many working tirelessly to get Ajax back on track. We need to build on that candour and dedication and encourage all those involved in procurement programmes to speak up, identify problems and make clear where those responsible are failing. A culture in which individuals are encouraged not to elevate problems but only solutions through the chain of command may be admirable in other circumstances, but rarely in procurement. We need to support our people by resolving underlying cultural issues that risk making it harder to deliver the capabilities needed by our armed forces.
To take that forward, we are commissioning a senior legal figure to look more deeply at Ajax and to examine not just health and safety, but the cultural and process flaws that it has highlighted. We will leave no stone unturned to learn those lessons. I encourage people to participate in the further review and will ensure they have the space to do so. Of course, if the review uncovers evidence of gross misconduct, those concerned will be held to account, but the primary purpose of this inquiry is to ensure that we address significant cultural failings. The terms of reference will be agreed with the reviewer and I will make them available to the House.
In summary, while we should not forget that General Dynamics UK is responsible for delivering a safe and effective vehicle, it is clear from the report that the customs and practices of the Army, Defence Equipment & Support, Defence Digital and the wider MOD resulted in a culture that prevented issues from being addressed at an earlier point. We are committed to ensuring that measures are put in place to deliver these very complex programmes in a way that minimises the risk to our people while delivering the capability needed by the armed forces. I commend this statement to the House.
John Healey (Wentworth and Dearne) (Lab)
I start by thanking the Minister for advance sight of his statement and for publishing this Ajax noise and vibration report. I pay tribute to his determination to get to the reasons why this Ajax procurement has gone so badly wrong and his commitment to updating the House openly on progress. This is vital to the UK’s warfighting capabilities and our frontline troops, so all sides of the House and beyond want to strengthen his hand in undertaking this work.
However, since the Minister commissioned this report, things have gone from bad to worse on Ajax. The Comptroller and Auditor General has confirmed to me that he has launched the urgent National Audit Office investigation into Ajax that I and the Defence Committee requested. The Public Accounts Committee has described the Ajax programme as a “catastrophe” and the MOD’s procurement system as “broken”.
This is a £5.5 billion programme that has been running for the past 10 years, has only delivered a couple of dozen vehicles and still has no definite date for completion. It is the biggest Defence procurement failure of the past decade. It is failing British taxpayers and failing British troops.
The first concern for any Minister or commander is rightly the safety of our own forces men and women, so this is an important report. It confirms that 17 individuals who worked on Ajax are still receiving specialist treatment for hearing loss, 11 have long-term limitations on their military duties and four have been medically discharged from service. What, if any, compensation have they received?
The Minister also refers to
“the significant number of personnel across defence whose exposure to noise results in short or long-term restrictions to their military duties.”
How many is that significant number, and when will the permanent secretary report on the wider problems?
More serious is what the Minister has described as the
“series of failures to act”
when concerns were raised about health and safety risks: the 2018 MOD safety notice that was not acted on, the 2020 Defence Safety Authority report that was retracted and the multiple warnings, including from the commanding officer in charge of the trials unit, that were not actioned. The Defence Secretary declared in this House last month that,
“it is really important…that we fundamentally learn the lessons and people carry the can for…their decisions.”—[Official Report, 25 November 2021; Vol. 704, c. 492.]
Has anyone been fired for the failings? Has anyone been demoted? I hesitate to ask this, but has anyone responsible been promoted since they worked on Ajax?
Fundamentally, there is a Defence Secretary-shaped hole in this report. There is no mention of his role or his misjudgments in this Ajax disaster. When exactly did the Defence Secretary first know about the flaws in Ajax? What action did he take then to investigate and fix the problems? The Ajax vibration problem has been known in the MOD since at least 2018, so why, when the Defence Secretary published his defence White Paper this year, did he double down on Ajax, scrapping Warrior and scaling back Challenger at the same time? Finally, neither this report nor the MOD’s continuing Millbrook trials were ready last month, so why did the Defence Secretary press ahead to confirm in “Future Soldier” that
“capabilities will be built around…Ajax”,
with other systems?
It is deeply unsatisfactory that the action following this review is to launch another review. It is also deeply unsatisfactory that Ajax is still in limbo, beset by suspicions that it is simply too big to be allowed to fail. Will the Minister now answer the remaining fundamental questions? What are the causes of the noise and vibration problems? Will the Defence Secretary scrap or stick with Ajax? What is the MOD’s cost for the additional trials and testing? What contingency plans are in place for the Army to have full reconnaissance and force-protection capabilities while Ajax is delayed or, indeed, deleted? Has the Minister discussed with the Welsh Government a plan to support jobs if Ajax is cancelled? What impact does this continuing delay to decisions on Ajax have on the Army’s ability to deploy the planned strike brigade?
The Defence Secretary’s rapid further cuts in Army numbers is directly linked to more advanced technology based on Ajax. Will Ministers now halt their Army cuts, at least until they have fixed this fundamentally failing procurement?
Jeremy Quin
I thank the shadow Secretary of State for welcoming the transparency that this report represents from the Ministry of Defence. He is absolutely right that its commissioning and publication have sent shock waves through Defence. That is valuable and important. Everyone needs to be aware of the important imperatives—people need to answer for them and ensure that they are on track—and, even by commissioning and publishing this report, we have sent an important and salutary message, as well as learning a lot of detailed facts. He was generous in that respect, but he was most ungenerous and wrong regarding the Secretary of State.
As set out in the report, we first knew of this issue in November 2020. Ministers acted promptly. I am concerned that at the time it was described to me as a late discovery item, and that was mentioned in the report, and a culture of optimism bias continued. That is why I insisted that no IOC would be declared without ministerial involvement. That is why we were, and have been, very focused on ensuring that we got to grips with this programme, which we have, and on ensuring that we had this report not only commissioned, but published.
The report has laid bare a host of very difficult issues inside Defence, across a whole series of organisations. That is what the Defence Secretary and I are absolutely focused on getting to grips with, and what we are doing. The purpose of the report was not to apportion blame, but to discover the facts. That is the normal process in industrial companies where there are issues of concern—to establish the facts and to set out recommendations. That has been done.
We want to have a second report—I have referred to that previously in the House—to dig deeper and to make certain that the lessons are learned and that the recommendations are appropriate. As I have said, if there are examples of gross misconduct, they will be acted on.
What the report revealed, however, is a deep cultural malaise: across Defence, horizontally, parts of it are not speaking to each other as they should be on a programme of this nature. Concerns are not being elevated as they should be, vertically up through the system. That is a problem, a failing, and it needs to be addressed. If we want to have proper procurement, we cannot have a culture in which people take the view that they want to hear only solutions and not problems. It is necessary to have a proper airing of concerns and for them to be taken up and dealt with.
The shadow Secretary of State raised a number of other points. A large number of hulls have been delivered to Merthyr and are being worked on. Of course, there has been a succession of capability drops in the project, so hulls will have to be enhanced and improved over time.
The right hon. Gentleman may believe that things have got worse. That is not my experience. On the contrary, we are in a far, far better position than we were last year and in a far better position than we were six months ago. Detailed work has been undertaken and conclusions from Millbrook will be with us before Christmas. GD has growing confidence in the design modifications that it believes can be effected. I will have no position on them until we have tested them, gone through them and made certain that they work, that they are efficacious and that they give us the kick that we require. There is a lot of work still to be done on headsets, but I have seen the benefit of having a full-time focused SRO and with ministerial focus on the project, driving it forward. We are in a far better place to take decisions on Ajax than we were. The project is in a healthier state than a year ago, as should be the case. It is an important capability that we need for our operational requirements, and we will continue the hard work to ensure that it is delivered.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the Chair of the Defence Committee.
Mr Tobias Ellwood (Bournemouth East) (Con)
I commend the focus that the Minister brings to the situation, which is very refreshing indeed. However, he speaks of a troubled programme with cultural and systematic failures and of commissioning a senior legal figure to investigate. The project is a complete mess. Indeed, our whole land warfare programme is now operationally suboptimal as we cut our tank numbers, all our armoured fighting vehicles and our recce vehicles and introduce Boxer—a wheeled vehicle but with no substantial firepower—and Ajax. As we have discussed, it is a £5 billion project that was expected in 2017, but only a dozen vehicles have arrived, and people are being sent to hospital because of the vibration problems. The MOD is fortunate that the west—sadly, this includes the UK—is now so risk-averse as we would struggle today to send appropriate hardware into Ukraine in a move that, in my view, would deter Putin from invading.
The real scandal is the cover-up and dishonesty that led to the integrated review hiding those very problems with Ajax that the Minister spoke about so that it would not be axed. I spoke to a number of four-star generals, and nobody expected it to survive the integrated review. It makes it difficult for me to call for defence spending to be increased to 3% to improve our defence posture because of the threats coming over the horizon when money is spent so poorly. I call on him to set a date in February when, if the procurement issues are not resolved, the project will finally be closed down.
Jeremy Quin
I thank the Chair of the Defence Committee for his comments. Last year, his Committee produced a helpful report on armoured vehicles that made absolutely clear the requirement to invest more in that part of our defence. The Committee was right to do that and to highlight those concerns, and it should be reassured by the investment that we are putting into Boxer and Challenger. A £41 billion programme of investment in equipment and support is going into the Army in the next 10 years, and £8 billion of that is new. We differ, however, on the requirement for a recce vehicle of this nature. We need such a 24-hour vehicle that can operate in all weathers and all conditions to provide that critical ground reconnaissance, and that is what we are procuring via Ajax.
We must make certain that we have all the facts, because decisions are best made with all the facts. The root cause analysis on noise and vibration is in process, and we are doing that at pace. I am determined to drive answers on that. My right hon. Friend is right to ask searching questions, but, as I said, we are in a far better position than we were six months ago to understand what is going on. I hope that, early next year, we will know far more and be able to say, “Yes, this is a capacity that we can bring in and will work.” I am hopeful that we will get there, but it depends on the analysis that we do.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the SNP spokesperson.
Dave Doogan (Angus) (SNP)
I thank the Minister for advance sight of his statement. This is a sorry tale, but more importantly, it is a strategically very important equipment failure that leaves a very serious capability gap. I, for one, am clear that the Minister’s statement does not satisfactorily address the issues.
The health, safety and environmental protection review gets to the heart of the failures. It provides helpful definition and sources for the catastrophic failures—numerous as they are—in the management control issues, which have come to define the literally incredible £5.5 billion defence procurement fiasco. I am sure that others will detail the chronic operational consequences of those failures for the ability of UK forces to fight and defend, so I will concentrate on technical details.
I said in this Chamber some months ago that the problem was
“not…MTU V8 diesels or the Renk transmissions”—[Official Report, 9 September 2021; Vol. 700, c. 494],
which were tried and tested assets in other platforms. So it has come to pass.
The review highlights the failure of the
“Track, suspension and running gear, in particular the tension and sprocket design/track interface”,
which are unique to Ajax. The engine, good as it is, is a proven engine poorly mounted in a badly designed vehicle. We also learned today that, as the review sets out, there were
“Quality issues associated with…inconsistent routing of cabling, lack of…weld quality…insecure components”.
That does not sound to me like a £6 million vehicle. The shoddy design and appalling quality management represent engineering management from a truly different era.
There is no shortage of concerns about the programme, but one of them is about the tone of the report: “This was all very difficult, and we’ve taken a look back to see where things went wrong.” Two elements are missing from that rather lightweight mea culpa routine: who is carrying the can, and what is the future of the programme? Can the Minister identify who will take responsibility for this almost limitless failure?
Currently, GD UK management are clearly letting down the workers at Merthyr and Oakdale. What discussions has the Minister had with GD US about their future? When will he make a final decision on the future of the programme?
Jeremy Quin
I am impressed with the hon. Gentleman’s attention to detail, but technical issues are not really within the scope of the health and safety report. Mr King would not claim to be the person who can put the House’s mind at rest on technical issues, but there is a huge amount of ongoing work on the matter. The Millbrook trials have concluded, as I say, and we are waiting for the conclusions to arrive before Christmas, and they will be analysed. That will get to the heart of the issues with root cause analysis of noise and vibration, which I know the hon. Gentleman will look forward to with eager anticipation. I will update the House on what the answers turn out to be; I would rather not prejudge that technical analysis.
The hon. Gentleman refers to General Dynamics. One of the positives in the programme since the issues came to light is that we have had a complete transformation in the relationship with General Dynamics, which has been taken up at a very senior level: I speak to the global chief executive, and she has been in direct communication with the head of DE&S. That has helped to drive real performance through General Dynamics, all the way through the system. We are seeing a complete transformation in how it views the programme, in its determination to succeed and in its willingness to embrace the problems, which are clear. It has its own theories about them and is developing design mitigations and design resolutions. We have yet to see whether or not they can absolutely succeed; clearly we will wish to test that independently.
Madam Deputy Speaker (Dame Rosie Winterton)
I call John Spellar—[Interruption]—Sir John Redwood.
John Redwood (Wokingham) (Con)
Thank you, Madam Deputy Speaker. The Minister says that there is a robust fixed-price contract, which is great news. Is he guaranteeing to the House that the very considerable remedial costs will not fall to taxpayers in any way?
Jeremy Quin
To confuse the right hon. Member for Warley (John Spellar) with my right hon. Friend the Member for Wokingham (John Redwood) is not a mistake that I would dare to make, Madam Deputy Speaker.
My right hon. Friend is right: this is a £5.5 billion firm-priced contract. I am very clear that we have a contract that says that 589 vehicles will be delivered that will meet our requirements for a price of £5.5 billion. That contract is very, very clear. I see no reason why this House or the taxpayer should pay more money to General Dynamics to produce 589 vehicles, when we have a contract for it to produce 589 vehicles to our requirements for £5.5 billion.
John Spellar (Warley) (Lab)
The Minister is to be congratulated on honestly identifying departmental failings. We all welcome that. It therefore seems almost churlish to criticise, but we have to, because the report skirts the core issue. Its conclusion admits that the vehicle
“is not fit for purpose”,
but nowhere that I can see does it state the deadline for deciding whether the project can ever succeed; if it cannot, whether the Department has to terminate the contract; and if so, what contingency plans it has. Or will the project just limp on, burning cash and putting our troops at risk with a dangerous capability gap?
Jeremy Quin
The right hon. Gentleman raises good questions, but I hope that I can reassure him in part. The conclusion does say that the vehicle is not fit for purpose. Of course it is not fit for purpose now, because anything that does not meet our requirements is not fit for purpose. We cannot put personnel at risk, so absolutely it is not a vehicle that we can take on now, and we are not prepared to. We will only take into service a vehicle that actually works for our purposes and meets our requirements.
There is work to be done, but the decision point on whether that can be achieved with this vehicle is not now. A huge amount of work is being done. The time to take those decisions is after the root cause analysis has been concluded. As I said, GD has its own theories and has done its own work, and it believes that it has design modifications that could well fit the bill, but I am not going to take a decision on that until we have examined them and it is more confident of their grounds.
Dr Andrew Murrison (South West Wiltshire) (Con)
The Ajax programme wins the competition, from a very long list, to be the poster boy of defence procurement disasters. My admiration for my hon. Friend the Minister and the Secretary of State for Defence cannot disguise the fact that the report is truly shocking. It points towards an institution that does not bake in human factors in the design of our kit and appears to ignore health and safety, to the great detriment of the men and women of our armed forces, including my constituents. It is not good enough.
What is my hon. Friend doing to ensure that people are truly held to account for this? If we have to go to a plan B in the new year, what contingency does he have for mounting stand-off radar, for example, on Wildcat and Watchkeeper, for rolling out the capability on our Boxer and Jackal fleets, and for using unmanned aerial vehicles? Otherwise, thanks to this tin can on tracks, we are going to have a walloping great hole in our defence capability.
Jeremy Quin
There are two halves to my right hon. Friend’s question. Given his background, I would expect nothing less from him than to be truly shocked by what this report reveals, and so am I. I was horrified when I read the report for the first time, and I am still horrified now. There were clearly flaws deep in the heart of defence, and people were not thinking through the consequences of actions and their implications for some of our personnel. I think a lot of that was due to failures by one person to speak to another, a lack of communication horizontally, and a failure to elevate problems or for them to be heard properly as they went up the chain of command. But none of this is excusable, and it is outrageous that we have ended up in this situation. We are deeply shocked by what the report reveals.
As I say, there is an ongoing process, but the key thing is to understand what has gone wrong. My right hon. Friend has referred to this particular procurement among others. I am afraid to say that I suspect a similar tale could be told about many procurements of the past. The fact is that on this procurement, we commissioned and published a report and, as I said, it sent shockwaves through the organisations, with people asking themselves, “Have I been doing this right? Am I doing this appropriately?” That is the way to start to implement a change in culture.
I can confirm that we are absolutely in a position to meet our operational requirements. We will always have fall-back positions. My right hon. Friend mentioned Watchkeeper. As he will recognise, there are huge benefits in having ground-mounted reconnaissance, and Ajax can provide a useful tool. We are committed to making certain that it works, but if it would not, for any reason, there will be alternatives to be brought forward.
Mr Kevan Jones (North Durham) (Lab)
I thank the Minister for his tenaciousness in providing the report. The opening paragraph of the conclusion states:
“Nothing in this Review detracts from the fact that GDUK has designed and built what MOD maintains is thus far a vehicle which is not fit for purpose and does not meet the contracted specification.”
In effect, we have a vehicle that does not work and has damaged our people, and GDUK has burnt something like £4 billion of UK taxpayers’ money so far. What the report does not actually outline, as my right hon. Friend the Member for Warley (John Spellar) said, is a timescale for when decisions have to be taken. When will the decision on whether we are going to can this project altogether be taken? If it is canned, may I pick up on an issue raised by the right hon. Member for Wokingham (John Redwood), which is the exposure of the taxpayer? There is a big difference between GDUK and GD globally. Is the global company legally liable for the liabilities of the programme?
Jeremy Quin
Those are good questions from the right hon. Gentleman. The key point from the quote he read out is the words “thus far”. Our focus with GD is getting a vehicle that meets the requirements and specifications of the Army, and which we can bring into service. As I say, GD has done a lot of work over the past six months. There are design modifications which it believes can help significantly. We are yet to test that—we are yet to hear definitive reports and we are yet to see its analysis—but progress is being made. So, first of all, we are not writing off Ajax, far from it. My hope is that it can still come into service as an absolute first-in-class vehicle. The capabilities are extraordinary if we can ensure that what are in many cases Newtonian problems of noise and vibration can be solved.
The right hon. Gentleman is right that £3.165 billion has so far been paid under the contract to GD. As I said to my right hon. Friend the Member for Wokingham (John Redwood), this is a £5.5 billion contract. It is clear under the contract that we have 589 vehicles plus other things that will come through as a result of it. There is a parent guarantee in place between GDUK, the subsidiary, and the parent company.
Rachel Hopkins (Luton South) (Lab)
Yet again, complacency when it comes to health and safety sees ordinary working people pay the price. Given that service personnel have been medically downgraded and some discharged due to their exposure to the noise and vibrations of Ajax, what measures will be put in place to protect their livelihoods and careers?
Jeremy Quin
I thank the hon. Lady. The passion with which she addresses that point is at the heart of why we undertook the report. I have to be slightly careful about what I say. Four individuals have been discharged and 11 downgraded. There is no definitive causal link established with Ajax, but it is certainly possible that Ajax was a contributory factor to hearing loss. Either way, it is deeply concerning.
The one thing I would say to reassure the hon. Lady is that I am absolutely confident that the same issues could not arise again. The reason I say that with such confidence is that I have seen the safety panels that have been created and the work they now do. There is no longer a situation where the left hand does not know what the right hand is doing. There is a single repository for knowledge. We have learned, I am pleased to say, from a situation in which all valid information raising difficult questions was spread in different parts of our organisation, and was not being brought forward and focused. I think I can speak with confidence to say that exactly the same problems could not, I believe, re-emerge, but there is more work to do in terms of culture to ensure that that is deeply embedded.
Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)
I thank the Minister for his statement. These are indeed very serious concerns being discussed today and, as other Members have said, they need to be addressed urgently. Alongside that, the committed and loyal staff at General Dynamics in my constituency are very concerned and worried about the uncertainty of not knowing what the future holds. I appreciate what the Minister said, but can I press him to give further details on the timescale for the outcome of the review, and a further commitment to ensure that staff, trade unions and the company are fully involved in the discussions, to ensure that the workforce at Merthyr Tydfil are kept in the loop as much as they possibly can be?
Jeremy Quin
I thank the hon. Gentleman for his question and for his input on this issue. He, like me, knows Merthyr. I visited the factory and the people working there. It is a great set-up and they are very proud of what they do. As I said in my statement, we should not forget that there are many people working tirelessly to deliver Ajax for the British Army. They are very proud of what they are doing and are bringing all their skills to bear to ensure we get that kit and get it as soon as we can. To be clear, there is no review into General Dynamics. We are working with General Dynamics and we intend to bring this vehicle forward. I cannot give a 100% guarantee, because one never can on a defence procurement programme, but we are a long way down the road on this programme—as we should be, given the number of years that it has taken to get us this far. We have invested heavily in it. It has a great capability. We will continue to invest in it. We will continue to work with GD, which is showing great commitment. I sincerely hope that during the course of next year we will be able to give dates on initial operating capability, full operating capacity and the like. I am looking at this with optimism but with my eyes wide open.
Oral Answers to Questions
Jeremy Quin Excerpts(3 years, 1 month ago)
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Stuart Anderson (Wolverhampton South West) (Con)
The Minister for Defence Procurement (Jeremy Quin)
Defence will invest at least £6.6 billion in research and development over the next four years in areas including space, directed energy weapons, and artificial intelligence. This will help to secure our military edge by ensuring that we can adopt modern technologies at scale and produce game-changing advantage.
Stuart Anderson
With the significant rise in AI being used in defence, what steps are being taken to ensure that there is transparency of calculations that show both an ethical and moral approach to defence?
Jeremy Quin
My hon. Friend asks a very good question that needs to be addressed. I am pleased to confirm that we are producing a defence AI strategy that will cover how we will get an operational advantage. That work is ongoing and it will be published in due course.
Alex Norris (Nottingham North) (Lab/Co-op)
Kevin Hollinrake (Thirsk and Malton) (Con)
The Minister for Defence Procurement (Jeremy Quin)
I assure my hon. Friend that, as he is aware, there is no longer a military requirement for RAF Linton-on-Ouse. The timing of the site’s disposal is under active consideration. There will be an announcement and I will write to him as soon as it is made. I expect to do so shortly.
Patrick Grady (Glasgow North) (SNP)
Jeremy Quin
I cannot comment on that, but I assure the hon. Gentleman that, as I think he is aware, the MOD looks seriously at that area. In March, we published our sustainability strategy, and we are regarded as a leader in NATO for our work on reducing emissions in military operations. We want to be best in class—that is what we are working towards—and I hope that we will see a further reduction in our carbon emissions in the years to come.
Simon Jupp (East Devon) (Con)
Cherilyn Mackrory (Truro and Falmouth) (Con)
Jeremy Quin
My hon. Friend is absolutely right. Falmouth has always had a vital role in the defence of the UK. A&P Falmouth’s in-service support contract, awarded in 2018, is worth some £239 million over 10 years. Given our strong investment in the Royal Navy, to which she referred, I have no doubt there will be future opportunities.
Jess Phillips (Birmingham, Yardley) (Lab)
Can the Secretary of State tell me, first, what contact he has had with the Home Office regarding the murder of Agnes Wanjiru to ensure that at least there has been effective monitoring of a man accused of murdering a woman? An answer from his Department last week stated:
“At present, the sexual exploitation of any person is not recorded as an offence in its own right”.
Can he explain why not, and can he tell the House when it will be an offence for a British soldier to partake in the sexual exploitation of prostituted adults?
David Duguid (Banff and Buchan) (Con)
Does my hon. Friend agree that the new AUKUS partnership will not only help keep our people safe by preserving security and stability in the Indo-Pacific but will also help deliver this Government’s ambitions to level-up across the whole United Kingdom, including through the creation of hundreds of jobs in Scotland?
Jeremy Quin
I very much hope so. We spend over £20 billion a year on UK defence and over 10% of that goes to Scotland. We have increased the number of direct Scottish defence jobs by a fifth over the last three years, and that goes right the way across Scotland including Score Marine in my hon. Friend’s constituency. Other opportunities will arise over the next few years and AUKUS is a great basis for the future, not only for defence but for our joint security and for prosperity.
Mr Kevan Jones (North Durham) (Lab)
At his last outing before the Defence Committee, the Minister for Defence Procurement would not give a commitment that the future solid support ships would be built in Britain; he just said that the integration would take place here. Can he say today what percentage of the content of those vessels will be UK-sourced to protect not just jobs but technology in the UK?
Jeremy Quin
As I recall, I said we expected a substantial amount of that build to be in the UK, and as the right hon. Gentleman well knows I cannot go much further on an ongoing procurement process.
Sarah Atherton (Wrexham) (Con)
Hightown barracks in Wrexham is the spiritual home of the Royal Welch Fusiliers. Ten years ago it was destined to be a housing estate but now it contains the Defence Mental Health Clinic, a reserve field detachment, cadets, a preparation college, support for transport and an inspiring anti-tank company. So will the Secretary of State agree to visit the barracks with me and thank Colonel Nick Lock and his team?
Armoured Cavalry Programme: Ajax Update
Jeremy Quin Excerpts(3 years, 2 months ago)
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The Minister for Defence Procurement (Jeremy Quin)
I wish to provide a further update to Parliament on the Ajax equipment project being delivered as part of the armoured cavalry programme.
Health and Safety
The review by the MOD’s Director of Health, Safety and Environmental Protection on the health and safety aspects of the noise and vibration concerns raised on Ajax is now in its final stages. The report runs through the chronology of the Ajax programme and key decisions made regarding safety in order to ensure a clear understanding of the current background and is being subjected to a formal Maxwellisation process. I look forward to the report being finalised. I will publish it in full.
Update on Personnel
The health of our service personnel is our top priority. At 30 September 2021, the total number of people exposed to noise and vibration from Ajax was 310, of whom 11 are civilians and 10 are now veterans. All 310 individuals have now been contacted and offered assessments for noise and vibration.
On noise, at 30 September 2021, 270 people have been assessed and 40 people have declined assessment or have so far been unavailable to attend. Of the 270 individuals who have been assessed, 231 have returned to duty having maintained or returned to pre-exposure levels of hearing. Of the 231, as an extra precaution, 166 people are receiving enhanced hearing surveillance. Of the remaining 39 people who have been assessed, 34 remain under specialist outpatient care at the Queen Elizabeth Hospital, Birmingham/Royal Centre for Defence Medicine; most of these are under-going a period of hearing rest prior to reassessment, at which point we expect a significant number to return to full duties. There are a remaining five individuals who have been medically downgraded—potentially requiring a change of duties within the armed forces—or discharged, either for reasons unrelated to hearing or with hearing loss as a major or minor cause. In the case of hearing loss being identified, Ajax may or may not be confirmed as a contributory factor. I am withholding a more precise breakdown of those downgraded or discharged because individuals could be identified resulting in a potential breach in medical confidentiality.
Vibration injuries is a highly specialised area, requiring a graduated assessment process. All 310 individuals exposed have been offered a vibration assessment, with around 125 having so far declined assessment. The process is ongoing but, at 30 September, 45 individuals have been referred for specialist assessment of symptoms which could be associated hand-transmitted vibration, nine individuals have been referred for specialist assessment of symptoms which could be associated with whole body vibration and nine individuals have been referred for both. None of the individuals exposed to Ajax have had a change in medical grading or been medically dischargeddue to vibration.
I will continue to update the House on the number of personnel affected by noise and vibration, including if any trends become apparent once the data has been further analysed.
Programmatic Issues
I have made clear that Ajax requires a full-time, dedicated senior responsible owner. I am pleased to report that we have now appointed David Marsh, who took up the role on 1 October with the endorsement of the infrastructure and projects authority. As the new SRO, he is now in the process of reviewing the armoured cavalry programme to determine what actions need to be taken to put the programme back on a sound footing.
On 6 September, following authorisation by the Ajax safety panel, the independent Millbrook trials recommenced. As planned, and following a further meeting of the safety panel, these trials continued at Bovington to provide a wider range of surfaces on which to test the vehicle. These trials involved General Dynamics crew and real-time monitoring of noise and vibration. Trials have been conducted on the turreted AJAX variant and on the ARES variant, both of which were Capability Drop 1 vehicles. The trials were run at the Millbrook Proving Ground and at Bovington. This has generated hundreds of gigabytes of data which is currently being processed. Subject to safety panel authorisation, trials of a second ARES Capability Drop 1 vehicle will commence shortly at the Millbrook Proving Ground. On 7 October the safety panel also authorised military personnel to conduct essential maintenance on the vehicle and marshalled movement.
Since my last statement data has continued to be gathered and analysed to determine the root cause of vibration in the vehicles. In parallel design modifications have been developed to reduce the vibration experienced by the crew. Testing continues to determine the effectiveness of the modifications and whether they would help ensure the vehicle meets the Army’s requirement.
Investigations into excess noise also continue. An in-line attenuator has been designed and we are now validating its effectiveness to address the noise transmitted through the communications headsets.
The focus for the MOD and General Dynamics remains on delivering long-term solutions for noise and vibration to ensure Ajax meets the Army’s need. Until then, it is not possible to determine a realistic timescale for declaration of initial operating capability or the later introduction of Ajax vehicles into operational service with the Army. We will not accept a vehicle that is not fit for purpose.
Ajax is an important capability for the Army and we are committed to working with General Dynamics for its delivery. We have a robust, firm price contract with General Dynamics under which they are required to provide the vehicles as set out in the contract for the agreed price of £5.5 billion.
[HCWS322]
Oral Answers to Questions
Jeremy Quin Excerpts(3 years, 3 months ago)
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Sir Robert Syms (Poole) (Con)
The Minister for Defence Procurement (Jeremy Quin)
Alongside the Department for International Trade and the Foreign, Commonwealth and Development Office, we are hugely supportive of defence export campaigns to our friends and allies, a posture reinforced by the defence and security industrial strategy. I have conducted regular meetings on exports in Poland, Finland, Ukraine and Greece over the course of the summer. Tomorrow, I will engage in meetings in Tokyo before joining potential international partners on Type 31 in Rosyth, Babcock having announced only last week a frigate deal with Indonesia.
Sir Robert Syms
I congratulate the defence team on all the work that they are putting in to get more defence exports: not only is it good for British defence, but it is good for jobs. I have one concern, though: the licensing system seems to have slowed down, not only because of covid, but because it is very bureaucratic. Could the Minister take that up with the Department for International Trade, which deals with the matter, and have a word with it to try to speed this up? I fear that some of my local companies are losing business.
Jeremy Quin
I think that 11,000 licences were granted during the covid period, but I note my hon. Friend’s concern, which I know is a real concern shared elsewhere in the House. DIT attempts to say that 70% of cases will be dealt with within 20 days and 99% within 60 days, but as we set out in DSIS, we need to get better both in transparency and in speed. We will be taking the matter up. I thank him for the question.
Martin Docherty-Hughes (West Dunbartonshire) (SNP)
As the gap between ally and systemic competitor narrows, we heard last week that China is planning to join global Britain in the sunlit uplands of the comprehensive and progressive agreement for trans-Pacific partnership. Given all that we have heard in the integrated review about the UK having a more joined-up foreign, security and trade policy, I would be interested to hear the Minister’s opinion on this strange news and what it is about such a trade deal that the Chinese Communist party finds so attractive.
Jeremy Quin
I am not actually in a great position to speak on behalf of the Chinese Communist party, but I can speak on behalf of the Government. I am delighted that we have a tilt to the Indo-Pacific, and that is coming through in so many different ways in the policy of this Government. It is a part of the world that will have 40% of global GDP in the not too distant future. We need to be properly engaged, and that is what we are doing.
Mr Tobias Ellwood (Bournemouth East) (Con)
I welcome the new nuclear alliance with Australia and the United States, but I wish we would use a bit more robust language and say why we are doing it. It is to stand up to China’s current behaviour in the South China sea; let us not continue to be in denial about that. However, the timing and the manner of this announcement are not without diplomatic consequence, and prompt further questions about the cohesion, purpose and, indeed, leadership of NATO after the bruised departure from Afghanistan. There is no doubt that France has overreacted to losing a major procurement deal, but does the Minister recognise that China’s authoritarian behaviour cannot be defeated by military means alone? We need all the tools and all the alliances working towards a common strategic aim, and if we do not resolve a sense of unity in the west and, indeed, NATO—
Mr Speaker
Order. The Chair of the Select Committee should know better. He cannot make a speech; it has to be a question. I got him in deliberately because of the job he holds, but he cannot take complete advantage of the Chair: it is not fair.
Jeremy Quin
All the questions were excellent, Mr Speaker, and I will try to deal with them. [Interruption.]
Mr Speaker
Order. Why is the right hon. Member for Bournemouth East (Mr Ellwood) shaking his head?
Mr Speaker
Right. I am in charge, and I am not trying to abuse my position, so do not abuse yours.
Jeremy Quin
First, let me make it absolutely clear that the agreement with the United States and Australia is a requirement—an Australian requirement—for their strategic purposes. It is a decision that they wanted to make in order to enhance their strategic capability and their strategic defence. We have very strong contacts and a relationship with Australia and the United States, quite transparently. It will be a pleasure to work with them, and to help to deliver this important strategic capacity for Australia.
As for France, again, we work very closely with the French. My right hon. Friend is well aware of that, and of the Lancaster House treaties. There are ongoing discussions about incredibly important joint defence initiatives that we run together. I was in contact with my opposite number over the weekend, and I am looking forward to our working very closely with the French in the years ahead, as we have always done in the past.
Dave Doogan (Angus) (SNP)
Given that Babcock’s Arrowhead 140 frigate has been selected by Indonesia in an outstanding endorsement of Scottish engineering, will the Minister ensure that the Government expend all available effort to assist in future foreign orders, both for licensed build in-country and for foreign Governments to have their ships built in Scotland?
Jeremy Quin
I entirely agree with the hon. Gentleman. As I said in my substantive answer, I have been working in Poland, Ukraine, Greece, and many other parts of the world where Babcock has aspirations. The United Kingdom has a great belief in the Scottish yards—far more belief than the Scottish Government appear to have, given some of their recent contracts.
Mr Mark Francois (Rayleigh and Wickford) (Con)
I, too, welcome the AUKUS deal, which gives great form to global Britain and could be very good for jobs in both Barrow and Derby. Can we remind the Australians, when they begin their 18-month assessment, that the UK’s Astute submarine is arguably even more capable than the United States’ Virginia class? And, by the way, it is cheaper.
Jeremy Quin
My right hon. Friend is a great advocate for British engineering and British defence jobs. There is an awful lot that is good about our Astute programme, but I am not going to second-guess the Australians’ 18-month assessment. They will work that through, but both we and the United States are there to support them in the delivery of this extremely important strategic capability.
Stewart Malcolm McDonald (Glasgow South) (SNP)
Thank you, Mr Speaker. It is good to see you back from “Coronation Street” in such fine form, and to see the defence team still in its place.
When the Government presented the integrated review to the House, we were told that this Indo-Pacific tilt would not undermine interests in the Euro-Atlantic area. Can the Minister tell the House exactly how engaging in secret diplomacy against the mutual security and against the trust interests with one of our closest European allies helps our interests in the Euro-Atlantic area?
Jeremy Quin
I think that that would be an accidental misunderstanding of the situation on the part of the hon. Gentleman. The reality is that a close friend and a close ally decided that they had a different strategic need and wanted to do something differently, and approached us. It would have been very strange not to have engaged in very constructive talks with Australia in those circumstances. That is not being seen to be going behind people’s backs; it is responding to a request.
Stewart Malcolm McDonald
But that was exactly what it was. Let us not muddy the words here: Paris was deceived, was it not? Are common challenges not better faced when liberal democracies trust each other and understand each other’s mutual interests? Whether it is on the rise of authoritarianism or on issues of climate change, terrorism or migration, we must be aligned with our Euro-Atlantic allies first. Has the fallout from AUKUS not taught us all that we need to pursue a comprehensive defence and security treaty with the European Union? Can the Minister tell us why France was excluded right from the start?
Jeremy Quin
We have a number of close relationships, including through the Five Eyes, that we pursue on a global basis. We have an extremely close relationship with France, with whom we are doing so much around the world and with whom we enjoy extremely close relationships on equipment and support, as well as actively in the field. The bedrock of our relationships inside western Europe is of course NATO, which I am sure the hon. Gentleman would agree with. That is absolutely vital, and it is the cornerstone of our defence. It is an area in which we work closely with our European allies, including France.
Robert Halfon (Harlow) (Con)
Mr Kevan Jones (North Durham) (Lab)
The Minister for Defence Procurement (Jeremy Quin)
The final contract for the manufacture of the fleet solid support ships will be awarded to a UK business, either solely or as part of a consortium. We have been clear that a significant proportion of the build work will be carried out in the UK.
Mr Jones
In spring, the MOD invited international companies to collaborate with UK firms to build the fleet solid support ship contract. Earlier this year, it awarded a £5 million design contract for the project. I have tried in numerous questions to the Minister to get the answers to these questions, and I have to say to him that his answers should be getting creative writing awards for the ways in which they avoid answering questions. May I ask him a direct question: who are the design contracts with—are they with the consortium or with the individual companies? Secondly, will he confirm that the prime contractor who wins this contract will be a UK company?
Jeremy Quin
We are engaged with the consortium as a whole. I would have to check for the right hon. Gentleman on the finer points of where exactly the contract lies within that consortium, but it is the consortium that is being appointed to conduct the design work and it is the consortium that will be expected to do that work. It is then the consortium that we will be turning to for the next stage. As he knows, four awards have been made and, from memory, they are for £5 million each. They go to each in that consortium, all of which have a UK component, and they will be presenting not only their design but their views on the next stage and the build programme. I will come back on the precise point he makes, as it is a fair question.
Philip Dunne (Ludlow) (Con)
It is a bit rich of Labour Members to be nit-picking on this contract, given that the competition that they were calling for, whereby shipyards in the UK were to be required to build these ships, is precisely what the Minister has engineered. Will he confirm to the House that following last week’s outstanding Defence and Security Equipment International exhibition in docklands, where, as he has mentioned, there were further contracts for British shipbuilders, and following the announcement of the establishment of the National Shipbuilding Office and AUKUS, the opportunities for defence shipbuilding in this country have never been greater?
Jeremy Quin
I was so flattered to be awarded the creative writing award by the right hon. Member for North Durham (Mr Jones) that I was perhaps too kind. There is an awful lot that is great going on in British shipbuilding at the moment. He has been calling for the design contracts to be awarded, and they have been awarded; we are getting on with the fleet solid support ships. As my right hon. Friend the Member for Ludlow (Philip Dunne) says, there is also great news on Type 31. There is a lot of good news in the sector.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
Dr Caroline Johnson (Sleaford and North Hykeham) (Con)
The Minister for Defence Procurement (Jeremy Quin)
Last week was a good week for defence jobs: I announced investments in laser and radio-frequency weapons, which will sustain 249 jobs and create 49 more, including 30 in Northern Ireland, and investment to enhance the capabilities of C-17 and Chinook, which will support 200 UK jobs and create 50 at RAF Brize Norton; and on Friday, my right hon. Friend the Secretary of State announced a £170 million investment in next-generation submarines, which will support 250 jobs at Barrow and 100 jobs at Rolls-Royce Derby. The UK sector more broadly already directly and indirectly supports more than 200,000 jobs throughout the UK.
Bob Seely
First, I thank all the service personnel involved in Operation Pitting and pay tribute to the as-ever impressive leadership of Brigadier James Martin.
Radar is vital to our nation’s defence, and the Royal Navy’s radar is made in Cowes on the Isle of Wight. Do the Government have a plan for the development of next-generation radar?
Jeremy Quin
We absolutely do. My hon. Friend is an assiduous proponent of the Island’s defence sector. In the summer, I visited GKN Aerospace in Cowes, which is one of a number of great companies on the Island. On radar, my hon. Friend will be pleased to hear that we are working closely with BAE Systems on the potential spiral development of the existing maritime radar.
Nicola Richards
My constituency of West Bromwich East boasts great skills and is only 30 minutes away from the Telford production hub for the British Army’s Boxer fighting vehicle. What is the Minister going to do to ensure that UK small and medium-sized enterprises, including our fantastic businesses in the Black Country, get proper access to contracts in defence supply chains?
Jeremy Quin
MOD spending on equipment and support with SMEs exceeded 21% last year. We are determined to push that proportion higher and I will publish a revised SME action plan later this year.
On Boxer, to which my hon. Friend referred, over 60% of the contract is expected to benefit UK suppliers. Following the integrated review, we are considering expanding the purchase, which will create even more opportunities for SMEs, including those in the Black Country.
Dr Johnson
Lincolnshire is rightly proud of its RAF links. The future combat air project will support jobs and bring crucial capability. Will my hon. Friend confirm that it is on track, with both our international partners and our industries?
Jeremy Quin
It is absolutely on track. Further progress was made last week with our international partners Italy and Sweden, both of which I have been in discussions with over the summer, and it is on my agenda for my meeting tomorrow with the Defence Secretary in Japan. Our £2 billion investment in the future combat air system is benefiting from the co-investment of hundreds of millions of pounds from our industrial partners.
John Spellar (Warley) (Lab)
Of course, jobs in the defence industry depend on contracts, so may I come back to the question about the fleet solid support ships posed directly by my right hon. Friend the Member for North Durham (Mr Jones), which the Minister has tried to slide by? Why does the Minister not give a clear message to the industry and the workforce that the Government will prioritise British jobs and the design contracts will clearly go to a British firm? Why not make a proper decision and send that message, which should also go to the steel industry?
Jeremy Quin
I am hoping to send an exact message. I reassure the right hon. Gentleman that, as I have said, we have made it absolutely clear that the contract will go to a British company, solely or as part of a consortium. We have introduced the social-value model, which is included in the defence and security industrial strategy, and it will play a significant part in the overall assessment phase. The right hon. Gentleman has pushed for this competition for a long time; it is ongoing and is going to happen, and I am looking forward to it. I am certain that British companies will be absolutely embedded throughout the process.
Chris Evans (Islwyn) (Lab/Co-op)
The Minister will know that companies in the defence industry have been subject to a spate of takeovers. Many familiar names, such as Cobham and GKN Aerospace, are now in foreign hands, while Meggitt has recently been subject to a takeover bid from a US-based company. Even though the companies involved have promised to protect jobs and research and development, that has not prevented them from selling assets and closing factories. Workers at GKN Driveline at Erdington in Birmingham are going on strike to protest against a proposal for 500 redundancies next May. What are the Government doing to ensure that when British companies are taken over, promises to keep jobs and research and development in this country are kept?
Jeremy Quin
As you will be aware, Mr Speaker, the legislation that we passed broadening the scope in which intervention can take place was cleared through this Parliament and is ready to be introduced. We take very seriously our responsibilities under the Enterprise Act 2002. This is a matter for the Secretary of State for Business, Energy and Industrial Strategy acting in his particular capacity, but guarantees can be sought and enforced as part of that process.
Theresa Villiers (Chipping Barnet) (Con)
The Minister for Defence Procurement (Jeremy Quin)
I am pleased to be able to confirm to my right hon. Friend that the High Barnet Army reserve centre has a continuing defence use and there are currently no plans for its sale.
Kirsten Oswald (East Renfrewshire) (SNP)
Jack Lopresti (Filton and Bradley Stoke) (Con)
My hon. Friend has already referred to the great economic benefits resulting from the £400 million investment in enhancing C-17 Chinook capability, but does he agree that it will also help us to ensure that we can continue to undertake complex operations like the recent withdrawal from Afghanistan, where C-17 transport aircraft played a key role?
Jeremy Quin
Absolutely; it did play a key role. It is a very valuable asset, alongside others, including the A400M, which also has a connection with my hon. Friend’s constituency. I have visited his constituency, where there are great skills in the defence sector. I was delighted to make that announcement and I am delighted to see that investment going into that part of our country.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
What assessment has the Secretary of State made of the impact of the introduction of operational MGS—MOD Guard Service—employment contracts on levels of staff fatigue and security at UK military bases?